Canadian coffee chain Tim Hortons’ China unit plans to open 20 new stores in Beijing by the end of 2020 as part of its ambition to have 1,500 stores over the next 9 years in China.
Yongchen Lu, CEO of Tim Hortons China, said it will prioritise on markets in the northern and eastern parts of China. In 2021, it will expand its footprint to South China.
In May 2018, Tim Hortons China was established from a joint venture between Tim Hortons’ parent company, RBI, and Cartesian Capital Group. Currently, the firm has nearly 50 stores in China, mostly in Shanghai. There are around 5,000 Tim Hortons stores globally.
Kantar Worldpanel China report said that the coffee market in China still has massive potential with the market far from saturation. Another ‘On-Premise Coffee Consumption’ report from Mintel showed that the on-premise coffee market had reached Rmb 42.6 billion (US$6.07 billion) in 2019 and will have a CAGR of 15.6% percent from 2020 to 2024. Mintel estimated that there were 126,000 coffee chain stores in China in 2019 with an incremental growth of 11.9% annually.
Other major players that are planning further expansion in this market include Starbucks and Costa, which was acquired by Coca-Cola. Another local player, Luckin Coffee, which was initially slated to outgrow Starbucks with 4,000 stores, now faces an uncertain future due to a financial scandal this year, on top of a possible internal shareholders’ rivalries for control of the company. Luckin has also fired its top executives, i.e. its CEO and COO this year, and will take ‘disciplinary’ actions over several of its employees for being involved in inflating the company’s revenues and expenses.
Tim Hortons planning 20 stores in Beijing
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