How Much Does a Tim Hortons Franchise Owner Make?

Officially, Item 19 reports sales and two major operating-cost ratios, not owner earnings. For 2025, the 585 included franchised Standard Shops produced average monthly Gross Sales of $107,845 and median monthly Gross Sales of $103,122. Annualized, those figures are $1,294,140 and $1,237,464. Item 19, pp. 73-74.

For the 510-Shop cost cohort, average and median Cost of Goods Sold were both 29% of Gross Sales, while average and median Labor Expense were both 30%. The FDD defines Cost of Goods Sold as food, beverages, and supplies; Labor Expense includes payroll, payroll taxes, and benefits. These ratios consume 59% of revenue before occupancy, royalty, advertising, technology, utilities, insurance, repairs, financing, and other expenses.

The range is estimated by applying a transparent operating-cost bridge to 80%, 100%, and 120% of the official median annualized Gross Sales. Because Item 19 gives no quartiles, the 80%-100%-120% revenue spread is an editorial sensitivity, not an FDD-reported distribution.

The model holds the official median Cost of Goods Sold at 29%, Labor Expense at 30%, royalty at 6%, and Advertising Contribution at 4%. It uses the FDD's 7%-13% lease range as an occupancy sensitivity, annual Restaurant Technology charges plus the Tim Horton Children's Foundation obligation, and a clearly labeled 14% allowance for other operating costs. The estimate is before interest, financing principal, personal income taxes, depreciation, and major capital expenditures.

Which assumptions are official and which are estimated?

• Official FDD facts: 2025 median Gross Sales, 29% Cost of Goods Sold, 30% Labor Expense, 4.5%-6% royalty, 4% Advertising Contribution, $450-$1,400 monthly Restaurant Technology charges, $1,750 foundation obligation, and a 7%-13% franchisor lease range.
• Derived calculations: annualized sales, annualized fixed fees, cohort percentages, implied margins, and the residual owner-earnings amounts.
• Editorial scenario assumptions: 80%-100%-120% of median sales, 10% midpoint occupancy, and 14% of sales for utilities, CAM and pass-through charges, insurance, repairs, payment processing, local administration, routine maintenance, and other costs not quantified in Item 19.
• Not modeled: financing interest and principal, personal income taxes, major remodels, replacement equipment, owner distributions, working-capital changes, and extraordinary expenses.

An active owner may capture the economic value of a manager position, but that value is compensation for work rather than additional passive profit. Adding the 2024 BLS median wage of $63,040 for Food Service Managers in food services and drinking places produces estimated owner-operator benefit of approximately $84,000, $137,000, and $204,000 across the three scenarios.

This adjustment is conservative in one respect because it uses wage only, not employer payroll taxes and benefits. It can be aggressive in another respect because an owner may not fully eliminate management payroll, particularly at a high-volume Shop or a multi-unit portfolio. The BLS Food Service Managers profile describes the wage benchmark and the operational duties being valued.

Actual earnings can fall below or rise above the scenario range because Item 19 does not disclose occupancy, utilities, insurance, maintenance, payment processing, depreciation, financing, or net profit. The most important unresolved variable is the total cost of the Shop's location and all other expenses omitted from the 59% food-and-labor ratio.

• Shop maturity and exclusions. The sales cohort included Shops reporting at least 10 months of 2025 sales. Fifty-two Shops with fewer than 10 months, 12 Shops with inconsistent information, 10 Operator Agreement Shops, and 12 Shops that closed during 2025 were excluded. New-shop economics may therefore differ.
• Occupancy structure. Item 6 lists 7%-13% of Gross Sales when Tim Hortons leases the premises to the franchisee, plus flow-through charges such as CAM, insurance, property taxes, and billing administration. A property-controlled Shop must replace the model's occupancy assumption with its actual lease or ownership costs.
• Fee variation. The royalty range is 4.5%-6%, although the FDD states the royalty is generally 6% when the franchisee has property control. Captured-traffic locations may have a 3% rather than 4% Advertising Contribution, but they can have materially different volume and occupancy economics.
• Sales dispersion. Average monthly Gross Sales ranged from $10,526 to $438,320, but Item 19 provides no quartiles. Those endpoints show variation, not a reliable probability range for a buyer's site.
• System population. Item 20 reports 669 franchised outlets and 24 company-owned outlets at December 31, 2025. Eleven franchised outlets operated under Operator Agreements. The Item 19 sales cohort is a narrower Standard Shop population and should not be applied to Non-Standard Shops, Operator Agreements, or Co-Branded Restaurants without separate evidence.
• Debt and taxes. Loan structure can materially reduce cash available to the owner. The scenarios exclude interest and principal and do not estimate personal income taxes, which depend on financing, entity structure, jurisdiction, deductions, and owner circumstances.

A buyer should replace every scenario assumption with location-specific evidence and operating records. The most useful diligence is a written bridge from Gross Sales to cash available to the owner for comparable mature Standard Shops in the same market and occupancy structure.

• Request Item 19 substantiation. Confirm the 585-Shop and 510-Shop cohort definitions, exclusions, New Model representation, and whether a target market differs from the national population.
• Interview current and former franchisees. Ask for trailing 12-month food cost, labor, royalty, advertising, technology, occupancy, utilities, repairs, insurance, merchant fees, manager compensation, and owner hours. The FTC's franchise-buying guidance explains why franchisee interviews and document review matter.
• Separate formats and agreements. Confirm whether the opportunity is a Standard Shop, Non-Standard Shop, New Model Shop, Operator Agreement, or Co-Branded Restaurant. Do not apply Standard Shop Item 19 results to another format.
• Obtain the actual occupancy package. Review base rent or percentage rent, CAM, property taxes, insurance, landlord administration, required remodels, and lease escalators.
• Verify the owner-role plan. Determine whether the approved managing director is the owner or a paid employee, and whether the staffing plan still requires a General Manager or Restaurant Manager.
• Model debt separately. Use the actual financed amount, interest rate, amortization, fees, and required reserves rather than subtracting startup investment from one year of sales.