BUS8320 - Tim Hortons: Analyzing the Global Business Environment

This report provides a comprehensive analysis of Tim Hortons' potential expansion into the Australian market. It includes a SWOT analysis, Porter's Five Forces analysis, and a PESTEL analysis of Australia's market environment. The report examines the opportunities and challenges Tim Hortons may face, considering factors such as competition, supplier power, customer preferences, and political and economic conditions. It also touches on trade policies, market entry strategies, and risk mitigation, ultimately assessing the viability of establishing a subsidiary in Australia. The goal is to provide Tim Hortons with insights to inform their expansion strategy and navigate the Australian business landscape effectively.

Running head: GLOBAL BUSINESS ENVIRONMENT ANALAYSIS OF TIM HORTONS
GLOBAL BUSINESS ENVIRONMENT ANALAYSIS OF TIM HORTONS
Name of the student
Name of the university
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1GLOBAL BUSINESS ENVIRONMENT ANALAYSIS OF TIM HORTONS
Executive summary
Tim Hortons Inc is planning to expand in the Australian market through the establishment of a
subsidiary. Therefore, the organization has undertaken a feasibility study in order to perceive the
present prospects of the organizational growth in the concerned market. The report enumerates
the different pros and cons that might be faced by the organization while making an expansion in
the respective market structure. It will be helping the business in undertaking the necessary steps
for mitigating the different risks that might be faced by the business while undertaking the
expansion. The purpose of the report is thereby to focus on the study of the micro and macro
environmental factors that might influence the growth of the organization in the Australian
markets.

2GLOBAL BUSINESS ENVIRONMENT ANALAYSIS OF TIM HORTONS
Table of Contents
1. Introduction..................................................................................................................................3
2. Industry analysis..........................................................................................................................3
2.1 SWOT analysis of the business’s prospects while operating in Australia.............................4
2.2 Porter’s five force analysis....................................................................................................5
3. Business environment of the country........................................................................................11
3.1 PESTEL of Australia’s market environment.......................................................................11
Conclusion.....................................................................................................................................16
References......................................................................................................................................18

3GLOBAL BUSINESS ENVIRONMENT ANALAYSIS OF TIM HORTONS
1. Introduction
The organization, Tim Hortons Inc., is a multinational fast food restaurant,
headquartered in Canada. The organization specializes in manufacturing coffee and donuts as per
the preferences of the customers. The different aspects that influenced the continuous growth of
the organization is dependent on the quality of the products and the services as per the demands.
The organization has expanded to some nine countries around the globe with an enhanced
revenue of US $3.00 billion, recorded in the year 2016. The organization is recently aiming to
expand its business in Australia through an establishment of a subsidiary (Timhortons., 2018).
The different prospects of the organizational growth and the risks that might be faced by the
organization while undertaking the expansion is being discussed as a part of the report. The
purpose of undertaking the discussion is based on the identification of the external and internal
environments in which the organization will be undertaking its functions. On the other hand, the
identification of the national prospects as per the market entry mode will be helping the business
in formulating strategies for the growth of the business.
2. Industry analysis
The industry analysis will be aiming at undertaking the present prospects of the growth of
the organization while operating in the Australian markets. The competition and the expectation
of the customers of the business will be identified through an analysis of the industrial
environment and the manner in which it affects the processes of the business.

4GLOBAL BUSINESS ENVIRONMENT ANALAYSIS OF TIM HORTONS
2.1 SWOT analysis of the business’s prospects while operating in Australia
The SWOT of the organization, Tim Hortons Inc, will be helping to identify the
different internal factors that help in maintaining a suitable performance as per the objectives of
the business.
Strengths
 Largest quick service restaurant chain
 Adherence to the Canadian culture
 Proper consumer relationship services
 Recognized brand name
 Proper quality management unit
Weaknesses
 Lesser brand recognition due to lack of
proper digital marketing statutes
 Smaller presence in the US markets
 Fierce competition in the operating
markets
 Disputes in the supplier relations
Opportunities
 Expansion in the international markets
 Expansion in the line of products
 Enhancement in the supply chain
Threats
 Global economic recession
 Existing competitors and the threat of
new entrants in the market
 Saturation in the existing markets
The different strengths and weaknesses that are enumerated through the SWOT of the
industry will e helping the same in bringing forth improvements in the processes. It will be
helping the organization in maintaining a continuous improvement structure in the functioning of
the same as per the demand of the customers. Suitable Consumer relationship services that are

5GLOBAL BUSINESS ENVIRONMENT ANALAYSIS OF TIM HORTONS
offered by the organization will be helping to maintain the loyalty of the consumers as per the
objectives of the business. On the other hand, the suitable quality management team of the
organization will be helping the same in maintaining the standard of the products and the
services that are offered by the business. It will be helping the business in making its expansion
in the Australian markets. The disputes in the supplier relations will be affecting the smooth
functioning of the enterprise through the interrupted supply of the raw materials. Lesser brand
recognition is characterized through the lack of digital marketing operations that are planned by
the business. The new entrants have enhanced the market competition and thereby the
competitive advantage of the organization against the other existing firms will be acting as a
means of sustenance for the enterprise. Diverse issues that might be faced by the organization in
the Australian market is based on the lower lines of product that is offered by the business. On
the other hand, the saturation of the market is affected through the lower range of products that
are offered by the enterprise.
2.2 Porter’s five force analysis
The Porter’s five- force analysis of the organization will be helping to identify different
market related factors that adds on to the growth and expansion of the business, Tim Hortons.
The diverse factors and risks that might be faced by the organization while operating in the
Australian markets are being enumerated in this section of the analysis.

6GLOBAL BUSINESS ENVIRONMENT ANALAYSIS OF TIM HORTONS
Intensity of existing rivalry
 The large industry size will be helping
the organization to grow in the
Australian markets as there are diverse
scopes of expansion.
 There are relatively low amount of
existing competitors of Tim Hortons in
Australia. It will be helping the
organization in undertaking the
uninterrupted growth and expansion
process of the same (Hang & Wang,
2012).
 The transparency in the government
regulations and the open trade policies
that are imposed by the legislation has
helped in maintaining the different
levels of change in the systems of the
business while operating in the
Australian markets (Reilly & Scott,

7GLOBAL BUSINESS ENVIRONMENT ANALAYSIS OF TIM HORTONS
2014).
 Large storage costs and rental
payments might affect the smooth
functioning of the business.
Bargaining power of the suppliers  The large number of substitute inputs
in the market will be helping the
organization to negotiate with the
suppliers to reduce the costs of the
different raw materials that is required
by the organization for undertaking the
smooth functioning of the processes.
On the other hand, the larger amount of
substitute inputs has created a high
competition for the suppliers in the
Australian markets. It will be helping
the organization, Tim Hortons to bring
in changes in the processes of the
business operations (Barraket &
Furneaux, 2012).
 Higher Diversity in the distribution
channels will be helping the
organization to undertake the proper
functioning of the distribution and the

8GLOBAL BUSINESS ENVIRONMENT ANALAYSIS OF TIM HORTONS
marketing strategies.
Threat of substitutes  The existence of substitutes of the
products that are offered by the
organization, Tim Hortons is high in
the Australian markets. It has posed a
threat to the product offering of the
organization and thereby maintain the
competitive advantage of the same
while operating as per the objectives of
the business (Schleimer & Pedersen,
2013). Product differentiation in the
different stages will be helping the
organization in proposing a better
quality product over the substitutes. It
will be helping the organization in
balancing the competitive advantage of
the business over the other substitutes
that are available in the market.
Bargaining power of the customers  The limited information on the
preferences of the buyers will be
affecting the organizational decisions of
making proficient designing of the
product offerings. On the other hand,

9GLOBAL BUSINESS ENVIRONMENT ANALAYSIS OF TIM HORTONS
the special customizations that are
expected by the buyers might not be
met by the organization due to lack of
proper survey of the likeness of the
buyers. It will be affecting the goodwill
of the organization relating to the lower
levels of customer satisfaction.
 The large number of customers will be
helping the organization in enhancing
the customer base of the business while
operating in the Australian markets.
 The pricing strategy that is being
implemented by the organization might
affect the buying behavior of the
customers (Barraket & Furneaux,
2012). The availability of substitutes in
the market and the comparatively lower
price of the substitutes might attract the
attention of the customers over the
concerned organization’s offerings. On
the other hand, the customer negotiate
on paying the acclaimed price based on
the quality of the product offering and

10GLOBAL BUSINESS ENVIRONMENT ANALAYSIS OF TIM HORTONS
the utility that is derived from the
product. Therefore, the value that is
proposed by the organization through
the introduction of the product must be
convincing the customers to enhance
their buying scale.
Threat of new competitors  The advancement in the technologies
that are undertaken by the existing
competitors of the concerned company
might affect the proper functioning of
the systems of the business while
operating in the Australian markets
(Schleimer & Pedersen, 2013). The
implementation of the relevant
technologies will be helping the
business in making its progress as per
the expectations of the customers. On
the other hand, the implementation of
the advanced technologies will be
helping the business in gaining a
competitive advantage in the Australian
markets.
 The different geographic factors help in

11GLOBAL BUSINESS ENVIRONMENT ANALAYSIS OF TIM HORTONS
limiting the competition in the market.
Identifying the demand of the
customers and the manner in which
their demand is characterized by their
employability and lifestyle will be
helping the organization in identifying
the prospects of growth while operating
in the Australian markets.
 The issue of patents helps in reducing
the competition that is faced by the
organization while operating in the
Australian markets (von Briel &
Recker, 2017). Therefore, the
concerned organization must take steps
to limit the competition that is faced by
the same through the existing
competitors and the new entrants by
issuing patents of the different product
offerings of the business.