HOW TIM HORTONS BROKE A 61-YEAR HIGHEST SALE RECORD IN PAKISTAN: 

A BUSINESS CASE STUDY


Tim Hortons opened its first outlet in Pakistan back in Feb 2023 and people queued up to get their favorite coffees. This is despite the fact that inflation in January spiked to 27% year-on-year, the highest in more than a decade, and the government only had enough foreign reserves to pay for just over three weeks of imports.


In this case study, I will briefly summarize my observations for Tim Horton’s record-breaking performance in Pakistan’s flagship stores, followed by the PESTEL analysis and PORTER’s 5 forces. 


Various factors are responsible for this peculiar attitude of the consumer market: Let me enlist them in concise headings to save reader's time: 


Pakistan has a population of almost 230 million and an economy of $350 billion. This makes the country a 

growth market for fast food companies. 


Tim Horton’s habitually employs intelligent marketing campaigns in the service of their market goals. Leveraging augmented reality ads is one such example. For the Pakistani market, the target audience seemed to be the suburban upper middle class and the wealthy strata's of society which had some sort of pre-established Tim’s brand awareness. 


An average visitor at the branch had the following to say when probed about the experience of visiting Tim Horton’s: “The brand's social media traction trumps the cost of the coffee. "I'm here to taste the coffee that's the top social media trend. I don't know about the price, nor do I care."


In a country that has a predominantly conservative societal outlook, food seems to be the only 

legitimate source of entertainment. Especially, Lahoris love to eat out late at night and hang out 

with friends. The city of Lahore never sleeps. 


Almost 664% of Pakistan’s population is below the age of 30. The largest age group of global visitors at Tim’s branches is between the ages of 25-34 thus, overlapping with a major chunk of the Tim Hortons Target Audience in Pakistan. 


In Pakistan, the maiden Tim Horton branches opened in the heart of Lahore: Gulberg and DHA - an elite residential area. Gulberg is the modern city center surrounded by corporate offices thus, covering a population segment with an elevated coffee consumption rate. 


The PESTEL Analysis 


Right now, Pakistan is plagued by a break-breaking inflation rate of 27.4% and the dichotomy between various income groups has considerably widened. Although, for the target audience of Tim Horton in this specific market, this might not matter much but still, the pricing models might give it a consideration. Secondly, with boycott campaigns against McDonald’s and KFC in Pakistan amid the conflicts in the Middle East leaves a potential gap in the market which can be plugged by Tim Horton’s in a timely manner. 


The government has brought the international food chains and QSRs under the umbrella of heavy taxation, Tim Hortons Pakistan needs to be mindful of this as well. 


Just like all over the world, there is a growing awareness among the Pakistani youth pertaining to healthier lifestyle choices. Coffees and other food items offered by the Tim Hortons and other similar food chains are perceived to be sugar intensive with higher calorie count. Given that people in Lahore have access to healthier alternatives, the writer is sure that the Tim Hortons is considerably aware of this trend. 


The tech landscape has evolved considerably in Pakistan and the Smartphone penetration in the country currently stands around 59%. As compared to 84% in Canada. Almost 15% of the population of Pakistan still lacks access to a simple mobile phone in Pakistan. Almost every QSR in the country has its mobile app with loyalty reward point offerings. Tim Hortons needs to adapt its strategy in Pakistan by considering the aforementioned facts. 


Porter’s 5 Forces


Although, Tim Horton's is a well known brand globally especially, in Canada, the customers in the Pakistani market hold medium to high power. This amid the greater number of alternatives, slow adoption to coffee as a drink of choice, the predominant warm environment and the cost associated. These factors need to be considered in the brand’s strategic planning in the local market. 


The rivalry in the existing local market is intense. Since it is a Red Ocean market, the sales of one QSR come at the expense of the other. Some direct rivals to Tim Hortons in Pakistan include McDonalds, Second Cup, Gloria Jeans, Butler’s Café, etc. 


The product range is fairly generic and is subject to price sensitivity. Raising costs in the local market 

of the product range could coerce the user to switch. Therefore, the local operations of Tim Hortons 

need to place an effective switching cost to counter this. 


Thanks to the economic and political conditions in Pakistan, the threat of new entrants is comparatively low. Setting up a new QSR in a similar niche is a very expensive exercise and the segment of the Target Audience is quite thin. 


The existing players in the QSR industry, with some exceptions, retain their own supply chain networks, thus, reducing the amount of dependability. The same holds true for Tim Hortons. 



In conclusion, Tim Hortons has pursued an aggressive growth and expansion strategy in Pakistan. Nevertheless, the brand needs to be mindful of the potential threats and opportunities pointed out in the aforementioned lines. Also, Tim Hortons Pakistan can work on inculcating local recipes with its traditional spin in the menu. Currently, there are some space and internet accessibility constraints within the premises of the outlets which can definitely be improved upon with the passage of time.