The problem with Tim Hortons is this:
At one point, they had over 90% of the market in Canada. Something like 94% of take out coffee in Canada was purchased from Tim's.
That doesn't sound like a problem but when you have shareholders, they don't want to just make money, they want GROWTH. It's not enough to see profits year by year, they need this year's profits to be MORE than last year's.
With 90% of the market, how are you going to increase profits? At that point, opening new locations isn't going to drive enough sales. So you have four options:
1) expand in other countries (where you're now forced to compete with established brands like Starbucks and Dunkin Donuts. )
2) increase prices
3) reduce costs (and therefore, quality)
4) sell the company
Tim's went with options 1 and 3 to start. They changed baked good suppliers. They let their coffee bean contract expire and found a new supplier. They started reducing the value of roll up the rim prizes.
This hurt them more than they expected, and suddenly (1) was fighting an even more uphill battle as McDonalds entered the coffee chain battle armed with Tim's old coffee supplier.
So, they go to option (4). The new owners see a sinking ship and they go ahead with a (2)+(3) Combo.
Meanwhile, Starbucks is starting to dominate. McDonalds sees where the puck is going and crafts this whole "café" experience. People laughed at it when they did it, but Tim Hortons finally started going in that same direction like 8 years later.
The owners, seeing Shrinking profits, pull another (4), and the NEW new owners are relentless with (2)+(3). By this point most Canadians have bailed.
What's more, Tim Hortons managed to embed a Canadians nationalism into its whole brand in the 80s, and they continued to ride that wave through the 21st century even as the general public is becoming LESS patriotic.
It'ss honestly like a masterclass in how you can ruin a financially successful company by failing to innovate.
If they started expanding in earnest 10 years earlier than their failed attempt, (like, before Starbucks really spread) they'd be in a very different position now.