The Use of the Numbers in Horse Racing; Those with Substance

Horse racing has more opinions than races, and that's a good thing, since we're handicappers. But without a central office which lays out business cases, we see and hear a great deal of opinion that's based on conjecture, feel, or the qualitative.

Fortunately in some quarters we have evidence that forms an opinion, rather than using an opinion as evidence.

Today on @o_crunk's twitter feed he shared some data.
  • 2015 will be the first year with fewer than 40,000 Thoroughbred races in the US since sometime in the 1960's.
  • Today, almost half the races raced, have field sizes of 7 or less.
  • "In NA in 1960, there were 29,773 distinct horses in 37,661 races run, avg field size of 8.95.
  • "In 2015, it will take 49,579 distinct horses to run around 38,700 races for an avg field size of 7.8."
That, of course, flies (partially) in the face of the foal crop argument. The simple fact is, horses are racing fewer and fewer times. The business could spend millions, could completely alter the economics of owning, increase purses rapidly and increase foal sizes by 50%, and it still would not support 50,000 races per year from a customer demand perspective.

Flipping over to harness racing, Balmoral Park closed up shop this past weekend. The Illinois track has struggled without alternative gaming and other factors, but make no mistake, this little track was big from the betting side and important for the harness racing demand ecosystem. The track also supplies industry decision makers with a much-needed lesson.

Here are some numbers from the last several years:

With falling foal crops, fewer horses in inventory and a 49% reduction in purses, Balmoral Park's handle increased from $984,000 to $1,347,100 since 2012. $29 of handle was generated from purses in 2015, versus $13 in 2012. Their average handle beats Parx (last time I checked) and Parx can run one ten claimer for near the purses of an entire evening at Balmoral.

The lesson in this all, in my view, is that numbers are numbers and a lot of them in racing are completely meaningless, but numbers with substance are important.

Almost every decision the sport makes with regards to new fees, taxes, takeout hikes and all the rest, are to prop up purses, to prop up falling foal crops (the braintrust physically broke out into applause for a takeout increase in California to 'fix things' remember?). In reality, handle can be gained, and revenue from that handle increased, by making races and the game a better bet. In terms of foal crops, they are what they are, and increasing the foal crop number - although important for suppliers -  will in no way save racetracks. In fact, from the supply side, it's barely a ripple when we consider the way the modern sport is run.

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