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Canada-Based Tim Hortons Franchisee Association Announces New U.S.-Based Group

Following on the heels of its own formation in March, the Great White North Franchisee Association (GWNFA), a Tim Hortons independent franchisee organization, announced today the formation of its U.S. counterpart, the Great White North Franchisee Association USA (GWNFA USA). The new group is represented by American attorneys Robert Zarco and Robert Einhorn of Zarco Einhorn Salkowski & Brito P.A.

The new alliance was launched to provide a united voice for Canada-headquartered Tim Hortons franchisees in the U.S., who are concerned about the alleged increasing mismanagement of Tim Hortons franchise operations by The TDL Group Corp. (TDL) (the franchisor) and its parent company, Restaurant Brands International (RBI) (NYSE: QSR, TSE: QSR).

Like many a franchisor before it, RBI refuses to talk to its franchisee association, the GWNFA, saying it works instead with the Tim Hortons franchisee advisory council. Advisory councils are what their name says, advisory in nature. They support a franchisor through advice, which is easily ignored. In contrast, franchisee associations are by the very nature of their formation and structure more independent and more clearly advocates for their respective franchisee groups.

The GWNFA was behind a class action suit filed on June 19, 2017 against RBI, TDL and company executives for breaching their obligations to Tim Hortons store owners in Canada.

The Canadian and U.S. associations plan to work together to resolve their problems with RBI’s management, which according to today's GWNFA announcement includes Restaurant Brands International:

  • receiving hidden vendor kickbacks, which depress franchisee profits through higher product and service costs
  • imposing new arbitrary standards designed to steal restaurants from franchisees
  • intimidating franchisees
  • robbing franchisees of their ability to sell their franchise businesses at a fair price
  • looting the franchisees' ad fund

“The long-term success of franchise systems like Tim Hortons depends on trust in the franchisor and a fair and equitable distribution of profits,” said Robert Einhorn of ZESB. “Since taking ownership, trust in RBI has disintegrated and it has aggressively imposed changes to the system without consultation and with contempt for the financial well-being of franchisees in the front line.”

Membership in the U.S. association includes almost half of all U.S.-based franchisees, including Tim Hortons’ three primary U.S. markets: Ohio, Michigan and New York.

RBI, which also owns Burger King and Popeyes, is controlled by Brazilian private equity firm 3G Capital. According to Marina Strauss of Canada's The Globe and Mail, “3G has also been involved in the takeovers of food companies Kraft and Heinz, as well as beer giants such as Anheuser Busch, where executives have also overseen aggressive cost-cutting drives and, in the process, shaken up those entire industries.”

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