Comparative Analysis of Tim Hortons and Starbucks: A Case Study in the Coffee Industry, Assignments of Production and Operations Management

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MBA 5040 Case Study 1: Tim Hortons Vs Starbucks (SSB) Sandermoen School of Business, University of Fredericton Dr. Dani Babb June 14, 2023 Introduction

Tim Hortons and Starbucks engage in an enthralling battle for dominance in the vast coffee industry. Although Tim Hortons has a staggering number of stores in Canada, it is an intriguing paradox that, despite its higher prices, Starbucks is the most popular coffee chain. This paper examines their distinctive placement strategies, the impact of their cuisine, and their innovative strategies for remaining competitive in an evolving market. These interactions cast light on the strategies employed by these renowned coffee companies. Operational Factors Shaping Prices The Price Paradox: Exposing Operational Factors Starbucks' reputation for charging more than Tim Hortons is due to many operational factors. Starbucks' continuous dedication to high-quality, expensive coffee beans drives this difference (Lee, 2020). Their fondness for rare and limited-edition coffee blends adds exclusivity to their goods. Starbucks' exquisitely designed stores, with warm seating, elegant decor, and enticing music, enhance the customer experience but raise operational costs, which are reflected in pricing (Lee, 2020). Barista training, which ensures uniformity, raises costs and pricing. Starbucks' expanded assortment of specialty drinks, teas, and seasonal treats increases complexity and inventory, which may lead to higher prices (Lee, 2020). Starbucks' Irresistible Allure Beyond National Boundaries: The Rise of Starbucks Around the World Although Tim Hortons started in Canada, Starbucks has won over coffee drinkers everywhere. Starbucks' careful cultivation of a global brand image consistent with quality coffee experiences is a major contributor to the company's continued success (Sukhpal S, 2021). Starbucks has become a global icon, capturing the attention of consumers all the way up in Canada, thanks to the

appreciate the importance of culinary options, but their success depends on recognizing their target audience and the local market. Thriving Amidst Change Tim Hortons and Starbucks: Industry leaders must adapt as coffee changes. Tim Hortons prioritizes mobile ordering to improve customer experiences (Shaffer. C, 2023). This unique tool lets customers skip lines and pre-order. Tim Hortons has partnered with third-party delivery providers to improve convenience and accessibility for its loyal consumers. Starbucks, like its competition, has invested in innovative technologies to create smartphone ordering, payment choices, and a comprehensive rewards program (Shaffer. C, 2023). The brand has stressed sustainability, used recyclable cups, and reduced waste, in response to changing consumer demands. Starbucks continues to lead the market by offering more plant-based meals and drinks. Conclusion Tim Hortons is bigger, but Starbucks is more popular and cheaper. Starbucks' quality, retail experiences, and global brand image make it irresistible. Starbucks has won over consumers globally with inventive products, urban professionals, and pleasant stores. Tim Hortons is everywhere in Canada, promoting ease and accessibility. Both titans choose locations based on their ideals and target demographics. Tim Hortons and Starbucks' popularity is also influenced by their various menus and local tastes. Tim Hortons and Starbucks have capitalized on digital technologies and promoted sustainability to meet the changing needs of discerning coffee drinkers. This change reflects consumer preferences and market rivalry. References

Saini, Sukhpal. (2021, April 22). “Tim Hortons Vs. Starbucks: The Power of Brand.” Medium, Retrieved from https://sssaini.medium.com/tim-hortons-vs-starbucks-the-power-of- brand-4cd4daff144f Lee, E. (2020). Comparative analysis of Starbucks and Tim Hortons in Canada. International Journal of Economics, Commerce and Management, 8(8), 288-295. Shaffer, Caitlin. (2023, March 18) “Tim Hortons Vs Starbucks (Which Coffee Shop Is King?).” Barista HQ, Retrieved from https://baristahq.com/tim-hortons-vs-starbucks/