Coffee review

Not expected! Chain brand Tims has only added 4 stores in 3 months!

Published: 2024-07-21 Author:
Last Updated: 2024/07/21, ▲ Click to pay attention| Daily Boutique Coffee Culture Magazine Coffee Factory before the U.S. stock market on June 5, Tims released its first-quarter 2024 results. Data shows that the company's total revenue in Q1 reached 346.8 million yuan, a year-on-year increase of 3.1%; system sales reached 363.5 million yuan, a year-on-year increase of 7.

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Tims released its first-quarter 2024 results ahead of U. S. stocks on June 5. According to the data, the total revenue of the company's Q1 reached 346.8 million yuan, an increase of 3.1% over the same period last year, while sales of the system reached 363.5 million yuan, an increase of 7.1% over the same period last year.

For brands, this financial report is a pretty good answer for the past three months. But in fact, Tims shares fell on the day the results were released, which shows that investors are not buying it.

Like Lucky and Starbucks, same-store sales of Tims were not optimistic in the first quarter of this year. But unlike the other two, the number of stores in Lucky and Starbucks continues to grow, with a net increase of 2342 in Lucky, 118 in Starbucks and only 5 in Tims! One of the five stores is a Popeyes fried chicken restaurant, which means that Tims has only added four new coffee shops in the past three months.

Compared with Tims's net addition of 149stores in the last quarter, the pace of store expansion in this quarter not only slowed down, but also fell directly below the previous record, making it the worst store expansion record since Tims went public.

Since last year, the competition between Cudy and Lucky's 9.9 coffee has become increasingly fierce. Recently, Starbucks' disguised price reduction and Lucky Cafe's announcement that it has entered the "6.6" era seem to add fire to this price war. Now, Piye, seesaw and other boutique coffee brands have also been affected by the war, have launched low-cost coffee to attract the attention of consumers.

Tims is naturally not immune, while reducing the price of coffee, participate in the 9.9 price war. On the other hand, it has raised the prices of bakery products such as bagels in an attempt to balance revenue from offline stores, but in fact the results have not been significant.

The increase in income is not as good as expected, while the loss has always been there. Although Tims signed a $20 million financing agreement with its existing shareholder Descartes Capital in March this year, it relieved the cash flow pressure, but could not fundamentally solve the brand's financial difficulties. In the first quarter of 2024, the net loss of Tims was more than 1.428 yuan. by the end of the quarter, Tims had total assets of 2.039 billion yuan and total liabilities of 2.607 billion yuan, with a debt ratio of 127.8 percent, up from 119 percent last year.

In addition, after Tims officially opened to join in September last year, insiders said that they had received a total of "3000" applications from franchisees, but in fact, only 19 new franchise stores were opened by the brand, far less than 1% of the number applied for.

On the one hand, the brand side is more stringent in the review, and the process is more complex. On the other hand, franchisees may still have doubts about the profitability of the Tims brand. After all, judging from this warm financial statement, the current situation of the Canadian national coffee brand in the Chinese market is not good.

Tims has previously revealed his small ambition to reach 10,000 stores in the next 5 to 10 years, but judging from the current speed of store expansion and the economic status of the brand, the goal he has promised is more like a cake that can not be seen and eaten, and the dream of 10,000 stores may be more and more out of reach for today's Tims.

Picture from: Internet

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