Canada (REUTERS) - Tim Hortons is betting its dollars on donuts in China.
The Canadian coffee chain unveiled plans on Wednesday (July 11) to open 1,500 outlets there over the next 10 years. Its owner, Restaurant Brands, is teaming up in a joint venture with private equity firm Cartesian Capital.
Tim Hortons will compete in the fast-growing market for coffee chains against Starbucks, which already boasts more than 3,000 stores in China, as well as local startups like Luckin Coffee.
"Part of the motivation for the move into China, the plan to move in 1,500 stores there, is that the company has been seeing falling profits in Canada and not great growth in the US, either," said Reuters correspondent Nichola Saminather.
The company needs to revive its brand because sales have fallen over the past two years. To that end, it plans spend more than $500 million (S$682 million) to remodel half of its restaurants in Canada by 2021.
"We're just testing 'Breakfast any time, any Tim's', which is our offering to our restaurant owners and to our guests that we're going to serve breakfast all day.
"The second one is, we're looking at a loyalty program. Imagine, we sell eight out of every 10 cups of coffee in Canada. Makes sense for us to give back to all the dedication that our guests give to us," said Tim Hortons president Alex Macedo.
The company is also testing a kids program to cater to families, and it aims to boost communications with its franchisee owners by holding biweekly webcasts.
Restaurant Brands shares rose in Wednesday morning trading, adding onto their 2 per cent gain this year.