Tim Horton’s daughter retires as franchisee, urges others to ‘keep demanding better’ amid clash with parent company

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The daughter of hockey star Tim Horton has retired as a franchisee in the coffee chain that bears his name, urging her peers to “keep demanding better” as declining profitability has led to tensions with parent company Restaurant Brands International Inc. QSR-T

In a letter sent to fellow franchisees in April, which was obtained by The Globe and Mail, Jeri Horton-Joyce announced her retirement effective May 31. She owned three Tim Hortons locations in Cobourg, Ont., and one in nearby Colborne, Ont.

In a statement, Tim Hortons president Axel Schwan confirmed that Ms. Horton-Joyce had transferred her restaurants to a family member, “and in addition to other extended family members who are current franchisees, this means that these important family legacies with the Tim Hortons brand will continue.”

Recently, Ms. Horton-Joyce was part of the board of directors of the Alliance of Canadian Franchisees (ACF), an independent group representing some disgruntled Tim Hortons franchisees. The ACF board resigned in March after Restaurant Brands International (RBI) sent default notices to the Tim Hortons owners serving on the board. RBI also terminated the franchise contract of its president, Ron Fox, at the time.

The board members had only been in their roles for a short time after the ACF appointed a new executive director the previous fall. The group had raised concerns in February about falling profits at Tim Hortons, a problem the parent company’s executives have said is a priority to address.

Ms. Horton-Joyce did not attribute her retirement decision to the recent tensions, writing only that the move came “sooner than I anticipated but for a variety of reasons it is the right time,” according to the letter. “I will still have family involved in the business and I want them to continue to prosper.”

Ms. Horton-Joyce declined a request for comment. ACF executive director Dave Lush also declined to comment.

“I am asking that everyone continue to help keep this fantastic brand going and to make it what we know it can be,” Ms. Horton-Joyce wrote in the letter. “Keep demanding better, never give up.”

Sales across the Tim Hortons chain have been going up, but cost pressures have squeezed restaurant owners’ profits. In February, Restaurant Brands disclosed that the average Tim Hortons location made $220,000 in earnings before interest, taxes, depreciation and amortization (EBITDA) in 2022 – down from $320,000 in 2018 when the company last reported those numbers. It has committed to reporting profit numbers annually in the future.

Last month, RBI chief executive Joshua Kobza said that franchisee profitability improved in its first quarter, though the company also acknowledged that it has continued to pass on rising commodity prices to franchisees. On a call to discuss first-quarter earnings, RBI executive chair Patrick Doyle said franchisee profitability is being given greater weight in incentive compensation for employees. But Mr. Doyle also reiterated a message that a “small number” of franchisees who were not “all in” on the company’s plans will be leaving the system.

Despite the tensions, Restaurant Brands says the vast majority of restaurant owners whose franchise agreements have come up for renewal in recent months have remained with the business. Since January, RBI has granted 215 new restaurant agreements to existing franchisees, and declined five owners who wanted to renew, according to the company.

Ms. Horton-Joyce’s decision was preceded by her husband and co-owner, Ron Joyce Jr. – son of the chain’s co-founder and first franchisee – who previously retired from the business.

“The Horton and Joyce families have contributed so much to Canada’s culture and fabric over the last 60 years. Jeri and Ron have all my best wishes for their retirement,” Mr. Schwan wrote in his statement.

Ms. Horton-Joyce’s brief tenure on the board of the breakaway franchisee group was not her first time in the spotlight. In 2018, she and Mr. Joyce drew widespread criticism after they cut back on paid breaks and reduced employee benefits at two locations in Cobourg. A memo from the owners claimed the changes were necessary because of the increase in Ontario’s minimum wage that year.

Ms. Horton-Joyce spent 37 years with the company as a franchise owner and operations representative. In her letter, she wrote about her memories of her father bringing home product recipes and coffee blends, turning to his family as a “test market,” although she added that the children were not permitted to drink the coffee “until our feet could touch the floor.”

“Hang in there,” she wrote. “Better times hopefully will return soon.”