How Ron Joyce Made Tim Hortons Iconic with FRESH Practices

Hi, I'm Evan Carmichael. Welcome to another edition of Modeling the Masters. Today we're going to look at Ron Joyce, the man behind the multi-billion dollar franchise Tim Hortons.

Ron Joyce is a Canadian multi-millionaire businessman. He co-founded the Tim Hortons donut chain as Tim Hortons' partner and first franchisee. Joyce grew up in rural Nova Scotia in a house without plumbing and a wood stove for heating. When he was 3 years old, his father died, leaving his mother to take care of the family on welfare. When he was 16 years old, he left home with his life savings of $35 to try his luck in the real world. After spending time in the Navy, he returned home to start a Dairy Queen franchise and also joined the police force where he met Tim Horton. Horton was a Canadian hockey legend who opened up a local coffee shop called Tim Hortons. The little shop was failing when Joyce proposed forging a partnership and bringing his expertise from Dairy Queen to save it. Today, Tim Hortons has over 3,500 locations, 100,000 employees, and $2 billion in revenues. Joyce himself owns at least 4 yachts, donates millions to charity, and has so much money he has even offered to fly people on trips anywhere in the world if they can help improve his golf swing. How did Ron Joyce get to where he is today? He did it by building a tiny coffee shop by the name of Tim Hortons into one of Canada's most beloved and successful brands.

So the next question becomes, how can you model the success of Ron Joyce? Here are 3 action items that you can put to use in your business today.

Action Item #1: Match your talents with your passion. You can be really good at something but not love it. You can also love doing something else, but not be really good at it. To be successful as an entrepreneur, you need to find the opportunity to combine what you love doing with what you're really good at. According to Ron Joyce, "I think people who excel in anything are often totally dedicated to it, but are only good at one thing. I look at the great athletes of all time, like Michael Jordan, who went from basketball to baseball and it didn't work, or Wayne Gretzky, who probably wouldn't have been great at anything but hockey." Are you like Michael Jordan trying to play baseball by doing something you love but aren't really good at? If you're struggling to get your company to the next level, try doing some soul searching to see if you've matched up your talents with what you love doing in the best way possible. Action Item #2: Treat your franchisees as partners. Franchising can be a great way to build a business because you don't need to fund it yourself and you can create an army of hard-working managers who have a self-interest in seeing you succeed. However, franchising is not a bulletproof concept and may fail when the franchisors don't provide the right support to their franchisees. Here's Ron Joyce's advice: "It was my philosophy to treat the franchise owners as partners." He followed through by creating a "Donut University," a central training facility where new franchise owners could go to learn the ropes of running the business and operate in a fast-paced environment. He also established regular meetings, a toll-free phone line, and field evaluations to provide support to his franchisees. He was willing to do whatever it took to get his partners off the ground and running. The result? Today, only 5% of the company's stores are corporate, while the rest are locally and operated owned franchises. With average profit margins ranging from 15% to 20%, owning a Tim Hortons franchise is a promising venture. In fact, more than half of all franchisees own more than one unit. Treat your franchisees fairly and give them the support they need to flourish, and they'll build your business for you. Action Item #3: Create a unique point of differentiation. If you want to stand out and win business from your competitors, then you need to do things differently from them. If there's nothing different about you, why should customers choose you when there are probably more established companies they could go with? When Joyce took over Tim Hortons, he wanted to stand out from all the other coffee chains. To do that, Joyce implemented a new set of business practices that focused on keeping things always fresh. He began to insist that all Tim Hortons coffee pots be cleaned 3 times a day and that no coffee be older than 20 minutes from the time the brewer stops dripping. All grounds were also to be thrown out immediately afterwards. But it didn't just stop at coffee. The temperatures of all cheese products and sandwiches were to be checked every other hour, as was soups. Donuts would have a shelf life of no more than 8 hours and could also be made to order. Bagels and other breads were also to be sold for no more than 8 hours after they were made, while cookies, danishes, and croissants could go for up to 12 hours, and only enough cakes for a given day were baked in any store. Customers began to come to Tim Hortons because they knew they had the freshest products available, and sales soared. What is your unique point of differentiation? Is it something that customers really care about and that makes you very different from your competitors? If not, it's time to go back to the drawing board and create a value proposition that's worth betting the company on.

So remember, match your passion to your talents, treat your franchisees as partners, and create a unique point of differentiation. I wanted to close the video with one of my favorite true stories about Ron Joyce.

Despite the fierceness with which he ran his business and expanding his franchise, Ron Joyce strove to always play fair. Once when a man applied for a Tim Hortons franchise and was turned down, he opened up a competing Robin's Donuts store nearby and saw his business explode. This time around, management at Tim Hortons became interested in the man and sought to open their own store nearby. Joyce, who had already left the company by this point, called his friends inside the business and convinced them to cancel their plans. He said it would be unfair to open a store and put out of business somebody who had once tried to be a part of the Tim Hortons franchise team.

Thank you for joining me for another edition of Modeling the Masters. I hope you enjoyed. I'd love to hear your feedback if you want to leave a comment below the video, and stay tuned for the next episode.