Tims China has made a series of leadership changes and senior appointments as the coffee chain moves to reshape its store network, strengthen its franchise model and address declining sales in the Chinese market.
Kwok Wah Cheung was appointed Chief Executive Officer of TH International Limited (Tims China), effective June 15, 2026, succeeding Yongchen Lu, who moved into the role of Chairman. Cheung brings more than two decades of consumer-sector experience in China, including senior leadership positions at Supor, China Feihe, Nestlé Greater China, Wyeth Nutrition, Coca-Cola and Procter & Gamble.
The leadership transition comes as Tims China works through a difficult start to 2026. The company reported a 14.6% year-on-year decline in first-quarter revenue to RMB256.7 million (US$37.2 million), while system sales fell 14.2% to RMB322.9 million (US$46.8 million). The decline was primarily attributed to the closure of underperforming stores and weaker same-store sales.
The company also strengthened its financial position through an agreement with THRI, its brand owner and founding shareholder, for the issuance of up to US$55 million of additional senior secured convertible notes. The financing is intended to support nationwide store-network expansion and strengthen the balance sheet.
Against this backdrop, Tims China is pursuing a more selective approach to expansion. The company closed a net 21 stores during the first quarter, taking its network from 1,047 stores at the end of 2025 to 1,026 stores across 93 cities on March 31, 2026. The closures included five made-to-order (MTO) stores and 16 non-MTO locations, including seven Tims Express stores.
At the same time, the company continued shifting its network toward franchising. Franchised stores increased from 455 at the end of March 2025 to 485 stores a year later, while company-owned stores fell to 541. MTO locations increased to 765, compared with 261 non-MTO stores.
Yongchen Lu said the company was continuing to “prune underperforming stores” during the first quarter and expected to complete the process before resuming net new store openings from the second quarter of 2026. He also highlighted the contribution of the sub-franchise business to the company’s cash flow and profitability.
The franchise model is becoming increasingly important to Tims China’s growth strategy. The company launched individual franchising in December 2023 and had received more than 10,000 applications by the end of 2025, with more than 300 individual franchise stores opened by year-end.
Special-channel franchising is another area of focus, with locations such as railway stations, hospitals and highway rest areas delivering store contribution margins in the high teens during 2025. The company expects these locations to offer payback periods of around two years and plans to accelerate openings in these channels.
The shift toward franchising comes as company-operated stores face continued pressure. Revenue from company-owned and operated stores fell 18.7% year-on-year to RMB207.2 million in Q1 2026, while same-store sales declined 12.4%. Average ticket size dropped 7.5%, and orders decreased 11.2% to 7.9 million.
Despite the sales pressure, Tims China continued to expand its customer base. Registered loyalty club members reached 35.9 million, up 42.9% year-on-year, while digital orders represented 87.5% of total orders during the quarter.
The company is also working to improve store economics through cost controls and network optimization. Food and packaging costs declined as a percentage of company-owned store revenue, while rental and property-management expenses fell 16.2%, reflecting the smaller company-operated estate.
Tims China ended 2025 with system sales of RMB1.57 billion, up 7.6% year-on-year, and 1,047 stores. The subsequent reduction in store count therefore represents a deliberate reset rather than a withdrawal from China.
With nearly half of its current network operated under franchise arrangements, Tims China is increasingly positioning franchising, MTO stores and higher-return special channels at the centre of its next growth phase. The leadership transition under Cheung will now coincide with the company’s effort to complete its store pruning, improve unit economics and return to network expansion.
