Bottom line
- Total investment $131K – $2.2M including a $50K franchise fee, 4.5% ongoing royalty.
- Average unit revenue of $106K/year (median $101K).
- Rated MODERATE with a risk score of 66/100. SBA loan default rate of 0.0% across 40 loans (below the industry average).
- 13 litigation matters disclosed in Item 3 — higher than typical. Review the summary for patterns (franchisor-initiated vs. franchisee-initiated).
Item 1 · who you're contracting with
The Franchisor
Yale framework · single-unit ROIC
Returns Analysis
Pulls Item 7 (investment) and Item 19 (revenue) from this brand's FDD into the Yale unlevered-ROIC formula. Override any input to stress-test it against your own assumptions.
The model · Yale framework
What would one Tim Hortons unit return on the cash you put in?
Unlevered ROIC · per unit
1%
Below typical band (30–60%)
Levered LBO scenario · Yale Crease Capital framing
What would 25 Tim Hortons units return on equity?
Equity IRR · 5-yr
49.9%
7.57× MOIC
Year-1 DSCR
1.88×
EBITDA ÷ debt service
Equity required
$137K
on $687K purchase
Total debt
$550K
SBA $0.3M + senior + seller note
Overview
About
Tim Hortons franchisees operate quick-service coffee and donut shops, managing daily operations including food preparation, customer service, inventory management, and staff scheduling. Franchisees must meet corporate standards for product quality, store appearance, and brand consistency while generating revenue primarily from coffee, baked goods, and breakfast/lunch items sold to local customer bases.
Item 7 · what it costs
The Vitals
Item 19
Financial Performance
Item 20 · unit dynamics
The Growth Chart
Year-over-year franchised unit counts and net change. Source: FDD Item 20.
Item 20 · 22 states with active franchisees
The Territory Map
Derived from franchisee contact records. Shows states with at least one current operator — not where the franchisor is registered to sell new units (that data is re-extracting in a future refresh).
States derived from franchisee phone area codes (Item 20). Approximate — ported numbers may show the original state, not the franchisee's current location.
Government records
SBA Loan Data
Aggregated from SBA 7(a) loan disclosures, public data unique to FranchiseVerdict.
FranchiseVerdict rating + FDD Items 3, 5, 6, 12, 17
Risk & Legal
Tim Hortons presents high investment risk due to shrinking unit base, hidden profitability metrics, extensive litigation history, and weak brand momentum in mature markets.
Score breakdown · what drove the 66 / 100 rating
- 01MINORDeclining unit count (-0.3% YoY) signals system contraction and potential market saturation
- 02MEDNo disclosed net income data prevents ROI validation; average revenue of $105,737 is extremely low for QSR and insufficient to cover typical operating costs
- 03HIGHMultiple active litigation cases including breach of contract, class actions on promotions/advertising funds, and no-poach settlements indicate systemic franchisor-franchisee disputes
- 04MINORNo protected territory creates direct competition risk from other Tim Hortons franchisees in same market
- 05MEDHigh royalty rate (4.5-6%) combined with undisclosed profitability suggests razor-thin or negative margins for franchisees
- 06MINOR20-year term locks capital with declining brand momentum in core Canadian market
- 07HIGHGoing Concern = False indicates potential financial instability at corporate level
Severity inferred from the FDD text · not a regulatory classification
FDD Items 5, 6, 12, 17 · continued from Risk & Legal
Contract & Territory Detail
Item 11
Training & Operations
Item 20
Franchisee Contacts
Phone numbers extracted directly from this brand's FDD Item 20. After purchase, you'll also receive a list of validation questions tailored to this brand.
Franchisee contacts
100 numbers
One-time purchase · CSV download · Validation questions included
FDD download
Tim Hortons · FDD (2025) PDF