The Doughnut Chain Growth
In Canada, Tim Hortons is the biggest doughnut seller and franchise with more than nine hundred stores in the country. Tim Horton has managed to acquire a network stretching throughout the nation as the fast-food market leader. The original intention was to sell many doughnuts, but over time they have diversified to providing muffins, cakes, sandwiches, and soup combinations. The first Tim Horton outlet opening was in 1964, which was a decade later than in the United States (Bloomfield, 1994).
The franchise used a few strategies to boost growth. The establishment of many stores originally happened in Ontario. The company established representation in all the provinces for a start. Regional warehouses were set up in Calgary and Moncton to support business growth in these provinces. The company’s focus was in intensifying outlets in a single city purposely to aggressively reach bigger market size and beat the competition. The first site for the establishment was Hamilton, chosen for its locational advantage. Hamilton attracted large volumes of customers because of strategic traffic positioning (Bloomfield, 1994). This strategy assissted in opening all the other outlets. The factors considered were highways with heavy traffic or places that had many pedestrians walking by. Over time, more outlets opened in shopping malls, institution buildings, and food courts. These outlets are still established close to each other because the business always makes profits (Bloomfield, 1994).
From the beginning, Tim Horton operated in small cities and avoided cities such as Toronto. The main reason behind the caution was the high costs of property, labor, and land. Avoiding such costs helped keep operational costs at a minimum while maximizing profits. The company remains cautious regarding expanding into the neighboring United States because it upholds the fact that different locations differ in their preferences and tastes. The franchise used the strategy of celebrity advertising to boost its sales (Bloomfield, 1994). Tim Horton achieved initial success because the market identified the name with a celebrity in sports, defining a brand name with the product being sold was not regularly used, and this strategy helped in getting Tim Horton ahead of the competition. With proper advertising, the system came qualified staff who offered efficient service, quality products, and a clean environment, the combination of these strategies pushed its expansion in the market
Tim Horton had a standardized approach used in all the outlets, which included standardized products, signage, and services. They used a centralized purchasing method then delivered the mixtures to the outlets in trucks. Preparation of the food was done in the outlets, which were open 24 hours (Bloomfield, 1994). Opening the outlet for 24 hours ensured a more significant share of the market was reached.