Industry Overview & Potential

Executive Summary

In conjunction with specific and qualified "Service Providers" the concept of “modular operations” being able to be provide investors wishing to become involved in the operations and ownership of racing and equestrian facilities a safe and secure format for investment.

The concept of “modular operations” is necessary in order to achieve the following outcomes:

• Sustainable high standards and quality in an industry of immense potential for employment, business and entertainment.

• A level of quality and standards applicable over a broad area with consistency

• Maximisation of resources in a new industry where resources are currently non-existent or scarce.

• Development of a “BRAND NAME” that adds value to all participants.

• Consistency in quality of consumable supplies to all venues

• Allow for the establishment of uniform operating procedures

• Uniform operating procedures allows for consistency in training, qualification and certification of participants at all levels.

• All of the above allows the maintenance of “Brand Name” 

Adoption of the “modular operations” opens the door to investors and interested parties that have no previous experience but have a passion for the industry to become an active participant without the inherent dangers associated with start up operations. As the risk is removed through the consistency and whole activity approach other industry members can feel safe in knowing that a “new player” will not distort or corrupt the “Brand Name” or the industry through either intent or by accident through lack of experience and or knowledge. Whilst the development of an industry that has multi layers each with specific requirements that in part are unique there is still a consistency of inputs, operations and management across all layers.

These layers or market segments can be broken into the following basic groups;

• Track Racing - Thoroughbred - Arab - Kurdish

• Endurance Racing - Thoroughbred - Arab - Kurdish

• Equestrian - Dressage - Jumping - Event - Polo

Whilst all venues may not cater for all market segments there is a need to have a standard that is acceptable by International Federations applicable to the segment. The optimum development of a facility may very well cater for other sporting and cultural activities that would provide additional revenue to the industry. Such activities might include; field sports (e.g. soccer and hockey), courts (tennis, basketball) or events such as polo. Local and traditional activities that could be adopted whilst fitting in with the principal activities associated with racing would encourage and attract the local population.

Fundamental issues to all Segments

• These fundamentals in broad terms are:

• Establishing & maintaining standards of horses

• Establishing & maintaining quality of training of both horses and participants

• Establishing & maintaining quality of transport

• Establishing & maintaining quality of stabling and care

• Establishing & maintaining veterinary services and standards

Standards of Horses

The basis for ensuring the authenticity of the breeding of a horse, the validity of the identity of the horse and the absence of performance enhancing drugs is centred on the establishment of scientific and veterinary controls. The fundamental process of breeding and identification is based upon a process of sampling and DNA registration through internationally accepted Registers controlled by the applicable International Bodies.  Modern programs such as DNA sampling in conjunction with micro chip implanting and registration through internationally recognised laboratories assist in control program establishment.

Applicable bodies include:

            Australian Stud Book - The Australian Equine Genetic Research Centre

Ensuring the absence of performance enhancing drugs is centred on the establishment of random “swabbing” of in competition horses utilising worlds best practice and internationally recognised forensic laboratories and sample collection and processing. Additional to ensuring that there are controls on performance enhancing drugs there is a need to have qualified and competent veterinarians to ensure horse condition and physical fitness to compete.

Quality of Training Horses & Participants

The quality of training is the basis of a successful industry, confidence by attendees and all participants. The training of people will ensure that the methods and operating policies and procedures need to be maintained through continuous improvement and review or audit programs. The training can be grouped into specific areas that remain consistent across all markets although some techniques or procedures may have specific refinements required for the segment.

Basic Groupings would be:

• Event Control - Judges - Stewards - Marshals - Coaches

•  Horse Care and Development

• Trainers - Owner / Trainer - Trainer - Trainer assistant - Stable Foreman

• Riders - Jockey / Barrier / Trackwork - Jockey / Race  Track - Jockey / Race Event - Jockey / Race Endurance - Rider / Dressage - Rider / Jumping

• Stable Hands - Strappers  

• Transporters - Handlers

• Veterinarians        Degree Qualified – Surgeon - Degree Qualified – General - Degree Qualified – Forensic - Equestrian Diploma - Farriers

• Other - Transport Drivers  - Ground Staff / Maintenance - Security - On Course Gaming - Catering / Hospitality - Lab Technicians - General Labour

• Business Manager - Accountant - Clerical - Promotions / Advertising

Training Strategy Training under these categories will be carried out utilising the services of the University of Queensland & Tafe NSW under contract to the peak racing authority. The syllabus and courses are determined by University of Queensland & Tafe NSW in order to comply with the required international standards that will be established. The courses of University of Queensland & Tafe NSW will be additional to English courses established.

• Students accepted into the courses being studied in Australia will be accommodated in facilities offered by University of Queensland & Tafe NSW
• The selection of appropriate students for training in Australia will be done through evaluation of available individuals in various locations in the Middle East. Experienced people will be evaluated and graded according to their knowledge, experience and ability and accredited by the peak racing authority on advice of University of Queensland & Tafe NSW and such accreditation will be accepted by all accredited tracks under the control of the racing authority.
• Courses will also be established where practical and appropriate in various locations throughout the Middle East with the best candidates being trained in Australia. The repatriation of the Australian trained individuals will allow the standards to be bettered and facilitate those qualified to operate and train in their own environments. This will allow the numbers to be increased at a faster rate than domestic training can be carried out.
• Consideration should be given to negotiating with University of Queensland & Tafe NSW to increase its accommodation and course numbers to cater for the required numbers. There maybe a requirement to assist with investment to facilitate such expansion and this could be derived from a levy on track owners or a partial reinvestment of the Licensing Fees that are paid by the track owners, horse owners and trainers.
• Additional opportunities may be targeted through replication of the University of Queensland & Tafe NSW program with other Australian State Racing Authorities or other countries such as UK or NZ.
• All individuals will be accredited and re-tested on regular periods and the accreditations will be recognised by the peak authority (including English usage).
• Transport Drivers and handlers will be trained and accredited through a training program centred on Livestock Transport Group in Australia and carried out in both Australia and the home country of the individuals.
• All individuals will be accredited and re-tested on regular periods and the accreditations will be recognised by the peak authority (including English usage).
• The training in this sector is coupled with operating policies and procedures and equipment standards.
• This is a specialist are that needs to be addressed with local operators in Australia or UK and NZ. Each individual in this area will need to be licensed after complete probity checks are carried out.
• All individuals will be accredited and re-tested on regular periods and the accreditations will be recognised by the peak authority (including English usage).
• Lab Technicians will be trained in courses determined in conjunction with Racing NSW’s forensic laboratory in order that the required standards necessary to create, maintain and operate an acceptable program of swabbing and elimination of illegal substances or activities under the best practices of International Racing.
• All individuals will be accredited and re-tested on regular periods and the accreditations will be recognised by the peak authority (including English usage).
• Catering and Hospitality courses are currently conducted in various countries within the planned footprint of racing operation. These courses will need to be supplemented with English courses to ensure a standard being adopted trough out the racing operating areas.
• In order to raise the standards to the highest levels possible it may become necessary to take the best individuals and have them attend “higher level qualifications” in overseas institutions.
•  All individuals will be accredited and re-tested on regular periods and the accreditations will be recognised by the peak authority (including English usage).
• Business Studies are conducted within the areas covered by the “footprint” with the possible need to increase compliance and understanding of international standards and policies.
• Where there is a shortage there could be international search and employment programs established as these skills are not necessarily industry based.
• All individuals will be accredited and re-tested on regular periods and the accreditations will be recognised by the peak authority (including English usage).
• Promotions / Advertising are conducted within the areas covered by the “footprint” with the possible need to increase compliance and understanding of international standards and policies.
• Where there is a shortage there could be international search and employment programs established as these skills are not necessarily industry based.
• All individuals will be accredited and re-tested on regular periods and the accreditations will be recognised by the peak authority (including English usage).

Each of the above groupings will need to have English training where they person does not have English skills. This is necessary to ensure consistency of application of policies and procedures across country boundaries.

Quality Transport Systems                                         

Transport and handling of horses is a specialist business that requires equipment to be well designed and maintained to prevent injury of animals. Poor quality transport and handling will also cause adverse performance of horses in competition where short periods of recovery from travel are available.

• A consistency in design of equipment, operating procedures and control systems will provide all parties with security and financial return on investment.

• Through adopting a policy of licensing, training and regular review the development of a business can be short circuited in terms of timing.            

Quality Stabling &  Care

The establishment of a limited number of specific designs for facilities that can be made available for selection by the venue owner will facilitate the establishment of a standards in design, safety for both horses and industry workers. The designs can be fully costed and be offered as part of the overall track facilities to be constructed or if the stabling is not on-site track location then as a “package” to owners and trainers for independent locations.

Through the adoption of standard designs and materials there are a number of efficiencies that can be gained in manufacturing components, construction of facilities and maintenance programs. These costs will be savings in the hands of those injecting capital into the development of the industry. Given that there are consistencies in designs then the operating procedures and issues pertaining to health and safety can be consistent which will facilitate facilities being “certified or accredited” and ongoing audit, review and evaluation can be carried out with a greater degree of consistency across the industry regardless of location or nationality.

Veterinary Services

This area of the industry is of absolute importance as the integrity, quality and operations of veterinary facilities and in particular forensic facilities handling swabs and samples as the punters, owners, jockeys, trainers and stewards will all have their confidence in the operations of the industry being derived from this area. There is an absolute need to ensure that veterinary services are available to all horses to ensure that animals are in the best possible condition and are presented well to the public. Without a well presented industry the “brand” and the spectators will not facilitate returns to the industry to ensure financial returns to all engaged or employed by the industry. Relative to international acceptance of the racing network being established as being “clean” and acceptable to off-course  gambling the standards of forensic testing needs to be of the highest quality and overseen by the best in international operations.

The most efficient path to achieve this would be to effect a program such as the following;

• Veterinary Studies

• Establish programs where accreditation to work in the industry is a certification by an Internationally recognised University in conjunction with registration with the controlling body in the Middle East.

• The training of vets is a major issue as there is a shortage of capable and competent vets, for large animals such as horses, and the training program is lengthy. It may be prudent to have agreement with various countries to allow student visas for suitable candidates to attend universities and higher education facilities. The controlling body may consider a sponsorship program coupled to employment contracts and opportunities for successful students.

• As indicated the training courses will take a minimum of 5 years to complete so there may become a need to address a short term solution that allows a “Diploma in Equine Studies” where a relatively short course could prepare individuals to perform “lower level” tasks. This would be much the same as a nurse working with a doctor. Such an arrangement would allow a few veterinarians the opportunity to treat a greater number of horses.

• The establishment of such a program would require the principal racing authority in the Middle East to contract these individuals as employees. This would be a counter to the fact that education facilities would not offer a course that would diminish the status of a full veterinary degree. Through an employer sponsored scheme such concerns could be diminished.

• Forensic Veterinary Facilities

• The establishment of a forensic laboratory overseen, managed and staffed by a recognised facility such as the Veterinary Labs at Randwick Sydney under the control of Racing NSW would provide both an independence and status to achieve necessary goals.

• Such a facility could be used for the collection and processing of “A” samples only whilst “B” samples are sent to the Sydney facility as the independent Lab.

• The costs associated with establishing and running such a facility would be derived from levies on owners and track operators.

Racing Venues & Facilities

The establishment of facilities on “green field sites” by operators / owners in an uncontrolled and open manner would create a network of tracks and facilities that were built / established by the interpretation of the owners. Unless there is a uniformity in design aspects of a track hosting racing where gambling takes place, be it on-course or off-course, the punters will find it difficult to accept and potential revenue of a particular track could vary significantly from other tracks depending upon the variance.

Whilst the intent is to build a new industry and brand name from a bare base position there is an opportunity to create standards, uniformity and at the same time facilitate investors with little or no experience to enter the business as everything could be supplied for them, at a cost . To achieve the standardisation of construction in a manner that is of quality, cost effective and within time frames developed there will need to be a team established that covers the following professions;

·         Surveyors

·         Engineers

·         Architects

·         Project Managers

·         Civil Constructors

·         Building Constructors

·         Contract and legal services

If we first deal with racing on courses, as is traditional in other countries and we later address the issues of endurance and events the following scenarios;

Give option of 4 levels of facility

• track, stables, on-site accommodation for support staff and an International Class Hotel.  – includes other facilities such as dressage, events, endurance and jumping.

• track, stables, on-site accommodation for support staff and an International Class Hotel.  Track, stables, on-site accommodation for support staff

• track, stables, on-site accommodation for support staff

• Track, stables

As the selection process is made by the investor there will be options within the Level of the facility. These will include

• Number of tracks within the facility i.e training , running etc

• Surface of the racing track

• Number of stables

• Number of marshalling area

• Number of on-site accommodation units

• Training aides such as walkers, pools, sand rolls etc

•  Number of rooms of the International Class Hotel

• Number of fixed catering facilities

•  Type of mechanical maintenance equipment

• Number of On-course gambling area

Facilities that will not be optional include;

• Track running rails - Starting Gates - Stewards Facilities - Veterinary facilities - Security

• Facilities for public such as: Parking - Toilets - Concession outlets (food and drinks) - Shaded areas - Seating / Stands Spectator Mounds - Perimeter Fencing - Horse loading and unloading facilities

Items, Equipment and Goods that will be common to all facilities and purchased centrally;

• Veterinary Supplies - Tack (saddles , bridles, rugs) - Consumables  - Confectionary - Track rails / Posts / Blocks Barriers - Spectator Facilities (shade cloth, sails, seating etc) - Stables & Buildings - Sheds - Catering Equipment  Electronic Equipment - Hospitality Equipment - Fences / Gates / Security Equipment - Machinery (tractors, trailers, lifting equipment) - Storage Bins - Water troughs - Waste disposal - Advertising boards and signs - Transport facilities (car parks, helipad, bus & truck facilities)

• All facilities will be accredited by the peak racing authority before racing is carried out. Without such accreditation there can be no off-course or on-course gambling authorised and horses registered under the racing authority will be prohibited from racing or banned from other tracks.

• Through uniformity of control the following can be managed by the racing authority; Advertising - TV / Documentary rights - Livestock Sales - Insurance - Gambling - Transport of Horses - Feed quality -Quarantine and registration of horses

• The track owner / Operator derives revenue for the following sources - Stable fees - Track fees - Racing Entry Fees - Concessions - Public Admission charges - Advertising / TV revenue  - On-course betting % turnover

• The peak Racing Authority derives revenue from the following sources - License Fees – Establishment and certification - Annual Renewal Fees of Licenses (base don turnover) - Advertising / TV revenue  - On-course betting % turnover - Racing Entry Fees - Track Certification for OH&S / QA

"Brand Name" & Trademark

The establishment of a “brand name” in the racing network will maximise the potential profits available and ensure that recognition of activities, advertising, promotions and consumables is maximised by all the population.

To achieve such a “brand name” standards in the following areas must be set, ,maintained and regularly monitored; - name and style of presentation i.e. font selection, font size by application, font positioning - Colour(s) standardised i.e. colour Pantone Matching System (PMS) - Standardised packaging materials in size and dimension by application - Standardisation of presentation and advertising materials - Selection and maintaining of quality and content of consumables sold to spectators - Standard method of betting and collection.

A number of the above components can be achieved through the use of either a specific supplier gained through a tender process where all parameters are provided as part of the tender documents. This will therefore allow the possibility of splitting orders between suppliers whilst ensuring the quality and specifications are consistent.