Shaurya Dubey
Tim Macbride
BUS106
11/10/2011

Tim Hortons to Offer Espresso

Dana Flavelle The Star

It is impossible to stay in Canada over a week and not know about Tim Horton's. Timmies as it is sometimes called, is a Canadian coffee giant and arguably the most well recognized brand in Canada. Tim Horton's serves millions of Canadians everyday and their consumers have grown accustomed to their fast service and low prices. While Tim Horton's is perceived as the everyday coffee chain, it's seemingly stepping up with its announcement of selling espresso coffee. Usually sold by stores like Starbucks, espresso coffee is gaining popularity in Canada, and who better to sell it to Canadians than Tim Hortons. While Tim Hortons is already the leading coffee retailer in Canada, their introduction of espresso on their menus could do wonders for an already big company. By pricing their espresso much lower than that of it's main competitor, Starbucks, Tim Hortons has not only made their new product sound good to the consumer, but also to investors and partners. While many experienced General partners can invest in the project and risk liability, this could also open the way for limited partners who wouldn’t want to get involved with the workings of the business. Being a public corporation, Tim Hortons would be open for the general public to invest in it, and having a promising marketing plan could lead to more investors. By offering more coffee than it's main competitor for a lower price, Tim Horton's is offering quite a promising business plan, this is also a good strategy for it to hit the ground running with it's new product. By estimating the 2% rise in espresso sales, Timmies has picked a good time to introduce espresso on it's menu, and being a giant corporation in itself, it can offer it's new product, which was previously thought to only be sold in “Urban elite” coffee shops, not only helping mainstream the product, but also boosting it's image as a corporation. Tim Horton's has also done some strategic planning on it's new venture, by seeing and analyzing the growing popularity of espresso coffee, it decided to offer it to the regular canadian at a lower price , thus going with the market trend. The only visible concern that can be seen with this plan is that if Tim Hortons is selling it's new coffee at such a low price, it could have a negative impact on the operating budget of Tim Horton's, however this could be dealt with by taking a look and comparing the budget projection from the first year after espresso production, and projections form years before. Not only would introducing it's own esspresso help Tim's get an edge on Starbucks, but Mcdonalds as well, which is it's biggest threat in the marketplace currently, thus effectively helping Tim's overcome a threat form its SWOT analysis. As for quality, Tim Hortons claims to using 100% arabica beans, the same kind used by most other cafe's to make espressos. Being seen widely as the number one coffee chain in Canada, Tim Horton's is capitalizing on the speciality coffee market, and with growth in popularity by 2% a year, it seems like a wise move to help mainstream the espresso and bring it to the everyday coffee store that millions of Canadians go to everyday. All in all this should have a positive effect on the already immensly popular Tim Hortons, and help its customers see it in a new light.

Works Cited: http://www.thestar.com/business/article/1079694--tim-hortons-to-offer-real-espresso-at-2-a-cup – Dana Flavelle
http://www.moneyville.ca/article/1079694