In this falling demand environment, handle increases are looked at like some sort of unattainable goal. In reality, a good old fashioned asset allocation model, from your average every day financial planner, can help quite a bit.
I was not surprised this week when I saw the Los Al handle numbers. About $400,000 per race was bet on this new meet, while last season - at the Fairs - only $265,000 was bet per race. The Cal Racing Fairs are a meet that simply - no matter what they do, really - could never drive serious handle. By allocating dates to a place people (somewhat) like, more handle was driven.
In Ontario over the last 15 years, slots changed the landscape appreciably. With 17 harness tracks - all with slot machines - the short-sighted legislation (and even shorter-sighted alphabets) demanded that the money from slots was doled out at said track, with no real organization. A lot of the tracks did not simulcast, didn't spend a lot of money on live cards, and were nothing more than a vehicle to redistribute gaming money.
These handles are well-known. $110,000 in purses at Woodstock Raceway for $8,600 in handle, and on and on.
At that time, a lot of us were begging the industry to allocate their financial resources where the most revenue could be gleaned from each dollar of a purse. For example, if London was generating $3 for every dollar of purses, where 50 miles down the road Woodstock was generating 8 cents for every dollar spent on purses, more dates, money or infrastructure would go to London.
If that did happen, handle goes up overnight. With 20 Woodstock dates generating $200,000 in total handle. those 20 dates go to London, and boom, like a magician with a wand, handle generated is $6 million. A 3000% increase.
The above sounds simple, but it isn't. The business is not structured to do that, because there is little central authority.
When, in Ontario, that central authority was created (ironically, after slots money was taken away), we see much more of this, by giving the dates to tracks that generate betting dollars, and culling those who did not. It's one of the reasons that for the third year in a row, per race handle is up 13.91%, and total handle is up 1.6% (despite a large drop in overall dates).
This being suggested now for states like Pennsylvania and New York is still considered blasphemy. But it's how any business tends to work - invest in areas that bring you the most ROI, and divest in areas that bring you the worst. Horse racing should be no different.
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