Tim Hortons is one of the most successful franchises in all of Canada and it's pretty difficult to lose money. However, there are reports of two Tim Hortons being run on taxpayers' money that are actually losing money. Why?
Over in Newfoundland, a Tim Hortons coffee shop located in the St. John’s Health Sciences Centre was able to garner many, many customers each day, but it still managed to lose approximately $260,000 and is the franchise’s fourth fiscal year to be drowning in the red.
With the Tim Hortons being a success, why did it lose so much money? A large coffee costs close to $2, but the person pouring it was being paid $20 per hour plus an additional $8 for benefits and employers costs. In total, a cashier was earning an hourly wage of $28.
The hospital coffee shop was paying its staff much higher wages than its counterparts because the people pouring the coffees and handing out doughnuts were Eastern Health staff. The average Tim Hortons employee usually gets paid the minimum wage or a little bit higher.
Due to the recent loss, Eastern Health made the decision to transfer the coffee shop’s operations to the private sector. The outlet was already privately managed, but a private operator will now maintain its employees.
“We’re going to have to shift dollars from inefficient areas into our strategic priorities to begin to meet unmet health-care needs,” said Vickie Kaminski, Eastern Health president and CEO, at a news conference Tuesday, reports the Toronto Star.
Tim Hortons has not commented on the situation.
Windsor Regional Hospital
Think it’s just an accident? CBC News reported of another Tim Hortons losing approximately $265,000 in taxpayer money at three Tim Hortons owned and operated by the Windsor Regional Hospital.
Tim Hortons employees are getting paid more than $26 per hour, but employees at the main lobby kiosk are earning less than $20 an hour. The hospital’s overall food services, including Tim Hortons, are losing about $600,000 annually.
“So that’s $600,000 that’s being taken away from our frontline health care,” said David Musyj, Windsor Regional Hospital CEO. “In one we are making a little bit of money, $6,000, that’s in the lobby of our Metropolitan Campus and one of the reasons we are making a little bit of money in the lobby is the fact we were able to negotiate a lower wage rate with our union.”