Tim Hortons Always Fresh Operations

Tim Hortons Always Fresh

Operations Management

Tuesday, November 9, 2010

Natalie LeBlanc

Stan Chen

Gavin Bryant

Abdul Alhamdan

Why Tim Horton's is always fresh - Operations Report

Suppliers

Maidstone Bakeries, located in Ontario, supplies Tim Hortons with Timbits and a variety of other baked products.

Tim Hortons company Fondant and Fills Manufacturing Facilities supply stores with creams and fillings, which are applied to the par-baked donuts after they receive their final baking in the restaurant's Always Fresh oven.

Tim Hortons company warehouses supply stores with paper and dry goods.

Tim Hortons company coffee roasting plants in Rochester, New York and Hamilton, Ontario.

The Maidstone Coffee facility located in Rochester, New York roasts coffee for approximately 47% of our total coffee requirements.

Baking Process

Par-Baked in Ontario Factory - Tim Hortons Donuts are "par-baked," meaning they are partially baked at the factory in Ontario, flash frozen, and delivered to one of five distribution centers across Canada and the U.S. From the distribution center, they are delivered to individual restaurants.

Always Fresh Oven Baking -- Most Tim Hortons restaurants now have an Always Fresh oven with the company's proprietary technology, which is designed to bake the frozen par-baked goods quickly.

Final Finishings - the restaurant completes the baking process with this oven and adds final finishings such as glazing and fondant, allowing the product to be served warm to the customer within a few minutes of baking.

Service Process

Restaurant - Restaurants bake ready-made donuts and pastry items in advance and place them in a glass display case for customers to select, after which employees will grab the donuts for the customer. Donuts that have been on the shelf too long are thrown away so as to maintain the company's reputation for freshness.

Drive-Thru - Customers can order donuts from the drive-thru, which the customer will grab from the display case in the restaurant.

Self-Service - Self-Service kiosks with one-cup-at-a-time coffee and baked goods.

Employee training

Tim Hortons has standardized Providing annual training in order to review and reaffirm employee commitment to follow our business practices and ethical standards.

Tim Hortons has special food safety training programs for employees.

Improving Restaurant Operations

Waste

Restaurants throw away donuts that have been on the shelf too long. Thus, there is a huge potential for waste if the restaurant misjudges demand or if patronage is demand is volatile.

Reduce Production - to reduce potential for waste, restaurants could reduce the production of ready-made donuts by 20% and increase production of the most affordable ready-made pastries by 20%. There would be a smaller margin for exhaustion of each variety. Donut varieties are interchangeable, so when certain varieties are exhausted, it is likely that customers would opt for an alternative variety of donut or even a pastry or cake item. Customers are unlikely to go into an aromatic donut shop for a donut and leave empty-handed.

Take Orders From Customers in Queues - Restaurants should send an employee through the line to take donut orders from those who already know what they want. This would allow the restaurant to adjust its production according to real-time demand input.

Tim Hortons is prone to dramatic peak periods such as the morning rush or lunch hour. Customers often wait in long queues during these periods. The value of the par-baked, Always Fresh production process is that it produces donuts in just a few minutes. Thus, it is possible for a particular restaurant to adjust production according to real-time demand.

Freshness

It is important to reduce the time between final baking and customer consumption as much as possible so as to keep the product fresh..

Smaller Batches - to reduce the time between baking and consumption, restaurants may produce donuts in smaller batches, so as to reduce the chance of certain varieties sitting in the display case too long.

Tim Hortons is known primarily for the freshness of its baked products. The freshness of the donuts is likely more important to customers than the selection on any given day, as donut varieties are interchangeable.