The parent company of Tim Hortons, Restaurant Brands International (RBI), told investors and customers to expect price increases in 2022, as the company grapples with labour inflation and increasing supply chain costs.
According to RBI CEO José Cil, its slate of fast-food brands including Tim Hortons have not been exempt from high costs, thusly, price increases are expected in 2022, reports Yahoo Finance.
“Given the level of commodity costs and labour inflation we’re seeing, we expect additional price increases in 2022,” said Cil on Tuesday during a quarter earnings conference call. According to the CEO, Tim Hortons prices in Canada have been just lower than Consumer Price Index levels and it is working with its franchisees to figure out next levels of pricing.
“Our teams work closely with the owners in Canada and with our supply chain teams to ensure that we have the right pricing going forward and continue to create that strong demand for our beverages and food,” said Cil.
Tim Hortons has seen sales improve during COVID-19 recovery, with its comparable sales metric up 10.3% year-over-year, versus an 11% decline in the same period a year ago.
“We’re highly competitive for Canadians in price, but also being fair to our franchisees,” said chief corporate officer Duncan Fulton.
Strong performance was led by the breakfast menu, while the collaboration with Justin Bieber for merchandise and Timbit flavours “was one of the more successful traffic-driving initiatives in recent memory and outperformed our internal expectations.”
Tim Hortons says sales at rural locations have now surpassed 2019 levels, but urban and suburban recovery has not yet reached pre-pandemic levels.
Recent Tim Hortons promotions have offered double the rewards points, leveraging the company’s mobile app to spur increased sales.