Tims franchisees push back on company claims after licence renewal denial
By Tara DeschampsGeneral Food & Beverage Franchisees Great White North Franchisee Association Tim Hortons
Franchisee involved in lawsuit against coffee chain denied licence renewal for Toronto store.
TORONTO—A Tim Hortons franchisee who is being denied a licence renewal after the company accused him of violating food safety and operating-standards has passed most of such reviews, internal documents obtained by The Canadian Press indicate.
The documents show Mark Kuziora, who has been critical of Tim Hortons’ operating practices and was involved in a class-action lawsuit against its parent company, failed only one review over three years to March 2018 and passed others with scores of between 70 and 95 per cent.
The Great White North Franchisee Association, which claims to represent at least half of Tim Hortons franchisees, said in a letter to the company defending Kuziora that the failures were caused by a change in requirements around the approval and purchase of small wares that they say was faced by “many other Tim Hortons store owners across the country.”
GWNFA has been fighting Tim Hortons on behalf of Kuziora since April, when the association said Kuziora was told he wouldn’t have the opportunity to renew his licence for one of the two Toronto locations he owns, when the licence expires on Aug. 31.
At the time, Tim Hortons did not offer a reason for the denial, but its president of Canadian operations, Sami Siddiqui, told the Globe and Mail that among other issues, Kuziora’s restaurant has “a documented history of problems … including food-safety violations and not meeting a number of other Tim Hortons operating standards.”
Siddiqui stood by his comments in an emailed statement Monday.
“Any decision to not approve a new restaurant agreement can sometimes result in strong emotions,” Siddiqui said. “It is not something that we take lightly and is not something we usually address publicly. We firmly stand by our previous statements publicly and to Mr. Kuziora on this matter.”
Kuziora has had a strained relationship with Tim Hortons, in part because he was involved in a class-action lawsuit last year that alleged RBI used money from a national advertising fund improperly.
The lawsuit accused RBI of funnelling nearly $700 million to be used for advertising, marketing and sales promotions to itself and TDL Group, a Tim Hortons subsidiary. At the time, RBI said it “vehemently” disagreed with and denied all the allegations.
GWNFA said Kuziora had been renegotiating with RBI for months, trusting that the negotiations were being done “in good faith,” so when he was contacted in April and told the company would be in touch to discuss the transfer of the restaurant to a new owner, it was “out of the blue.”
“We have to wonder if not renewing his licence has anything to do with his being a member of the board of GWNFA and having his name on the ad fund lawsuit,” GWNFA said in a previous news release. “As far as we are concerned, this is nothing more than intimidation tactic.”
At the time, Tim Hortons told The Canadian Press that Kuziora didn’t have any renewal rights through his licence agreement for the restaurant and said, “we regularly onboard new restaurant owners and transition restaurants as part of our normal course of business activity.”
The statements and Kuziora’s licence denial riled up GWNFA, which has been sparring with the company over everything from cost-cutting measures to delays in supply deliveries to a $700-million renovation plan that they say will cost store owners $450,000 per restaurant.
In the wake of the unrest, the company’s brand reputation rankings have plummeted and RBI president Alex Macedo has started doing damage control, criss-crossing the country to meet with thousands of franchisees in a bid to regain their trust.