Canada’s Largest Quick Service Retailer Saves and Estimated $2 Million Annually Through Construction Audit
The Tim Hortons chain was founded in 1964 in Hamilton, Ontario. The chain’s focus on top quality, value, great service and community leadership has allowed it to grow into the largest quick service restaurant chain in Canada specializing in always-fresh coffee, baked goods and homestyle lunches.
Tim Hortons is a franchisor of retail coffee and donut stores. Based in Oakville, Ontario, they currently have 2,500 locations in Canada and 500 locations in the United States. They build approximately 200 new stores as well as renovate 200 locations each year. Their construction contracts are fixed fee.
Control Solutions was engaged by Tim Hortons to perform a review of their construction procedures, including
bidding, awarding of contracts, processing of change orders, project approvals, project closeouts, and
documentation. Because they are a retail chain, we offered suggestions for audit approaches that were less site specific and more vendor specific, thus increasing the efficiency of the audits.
Summary of Results
We reviewed over 70 projects representing approximately $30 million in total construction costs and made recommendations projected to save Tim Hortons $2 million annually. These recommendations included items related to segregation of duties, data capture, budget approvals and change order approvals. Our
recommendations were approved by the Chief Financial Officer, and we will be performing an implementation
review in 2009 to determine the level of compliance.
Our approach in working with the Tim Hortons internal audit department was designed to mentor and train several of their internal staff on our leading construction audit methodology. Throughout our engagement, one of the Tim Hortons audit team members was assigned to work directly with us to receive hands-on training and knowledge transfer.