Returning to the past to plan the future
KEITH MCARTHUR
From Saturday’s Globe and Mail
May 4, 2007 at 8:39 PM EDT
Hamilton, Ont. — — The locals say there’s a Tim Hortons [THI-T]on every street corner in Hamilton.
It’s not quite that bad, but there are certainly spots in this working-class city, an hour’s drive west of Toronto, where you can walk out the front door of one outlet and see another.
The company returned to its roots Friday, holding its first shareholder meeting as a re-minted Canadian company a short drive from the spot where the first outlet opened in 1964.
Tim Hortons Inc. chairman and chief executive officer Paul House, who grew up in nearby Stoney Creek, said Hamilton was the obvious choice for the historic meeting.
“I grew up in the area, but it had nothing to do with me and everything to do with where the chain started,” he said after the meeting. “Our heritage is here. Our roots are here. The first store is still on Ottawa Street.”
Mr. House didn’t have time to drop by the original store, but held court with media after the meeting in a replica retro-style doughnut shop that had been carefully assembled on the stage at Hamilton’s Theatre Aquarius.
After investors feasted on a non-stop buffet of coffee, doughnuts and breakfast sandwiches, they were welcomed to the city by Hamilton Mayor Fred Eisenberger, who said the company — now based in Oakville, Ont. — is “very much a part” of the Hamilton community.
There were fewer retail investors, perhaps, than if the meeting had been had been held in Toronto, and Mr. House and his executive team were spared the barrage of suggestions and product ideas that often come from shareholders of a major consumer brand.
One investor, however, did strongly suggest that Tims take a run at U.S. chain Krispie Kreme Doughnuts Inc. in order to grow more quickly in the United States.
Mr. House said he wouldn’t rule out an acquisition under the right circumstances, but said it’s not part of the company’s U.S. growth strategy. Instead, Tim Hortons plans to grow steadily in New York, Michigan, Ohio and Maine and have 500 stores in the United States by the end of 2008.
On Thursday, Tim Hortons reported slower-than-expected sales at its U.S. operations and said investors should continue to expect some volatility in that market, which represents about 10 per cent of the company.
Tim Hortons was spun out from Wendy’s International Inc. [WEN-N] last year.
The original doughnut shop still stands at 64 Ottawa St. in Hamilton where it was founded in 1964 by hockey legend Tim Horton. Other than a commemorative plaque and a pair of display cases full of nostalgia about the hockey player and the company, it’s little different from any of the other 2,700 hundred stores across the country.
Tourists occasionally drop by to look at the display cases and take pictures, according to one employee who said she could not give her name unless it was cleared by head office.
Gary Baglin, who grew up around the corner from the first location, said he still comes by three or four times a day to pick up coffee, and maybe a snack.
Mr. Baglin, 43, was born the year the first store opened and has childhood memories of coming by the store for a doughnut after a swim at the public pool.
“I’ve tried just about everything on the menu,” he said.
Mr. House doesn’t remember the first store, but says he clearly remembers the opening of the seventh store.
“That was the first one that opened in proximity of where I lived and it was the rage when it opened,” he said.
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