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Chief Stipe

Interesting Article: Queensland Clubs Running Their Own Totes

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https://bitofayarn.com/racenews/new-technology-to-help-with-tote-losses/

 

The Brisbane Racing Club wants to speed up the introduction of new technology to help overcome losses with its on-course totalisator.

On-course totalisators were once a major source of income for clubs but in recent years they have become a major drain on profits.

The majority of major clubs in Queensland are responsible for the operation of their on-course totalisators and almost all run at a loss.

The problem will again be highlighted when the BRC’s annual report is handed down on October 23.

Totalisator betting at BRC meetings has remained static at around $12 million per annum which is well down on even three years ago when it was at $19 million.

Some of the problem stems from punters betting on their mobile phone apps at the track rather than through the traditional betting points.

TABCORP, which has exclusive rights to on-course totalisator betting at BRC meetings, has been rolling out new geolocation technology at clubs and pubs to overcome similar problems.

The technology pinpoints where the bet has been made and commission can then be credited to the pub or club.

A similar technology is set to be rolled out for race clubs in the next 12 months.

BRC Chairman Neville Bell said it could not come soon enough and would help alleviate losses associated with the on-course totalisator.

“We aren’t the only club carrying heavy losses on the totalisator. I often see people having a bet on their app and ask them to have the bet through the club’s machines,” he said.

“But, of course, in this day and age many people don’t carry cash. The sooner we get the technology the better and I think all clubs who run their own totes would agree.”

“After all if it was any other commercial business which consistently had a service running at a loss you would close it.”

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5 minutes ago, curious said:

No idea why they haven't done that here and years ago. No brainer.

Maybe a business opportunity.  Come in Reefton we need an accountant.  Seriously what the NZRB has always lacked is internal competition.

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9 minutes ago, Chief Stipe said:

Maybe a business opportunity.  Come in Reefton we need an accountant.  Seriously what the NZRB has always lacked is internal competition.

I've been saying the Clubs should set up their own gaming agency for years.  Issues however(1)the TAB has a legal monopoly so you would have to run it out of the Cooks or somewhere (2)the big Clubs have Boards that would not be brave enough(as may have a lot of small clubs) and (3) it would take a bit of setting up so you would need some REAL expertise

Re oncourse totes well it was not that long ago that Clubs did run their own totes.  I would contend that it is the sort of thing they should be doing.  Contract to the TAB(or if you could get permission then to some other Agency) to run them at (say) a 12% commission rate - then it you wanted to entice people to punt on course you could offer either (1) a rebate on betting(eg 5% back on your bet value) or (2) increased odds.  The former is safer to prevent yourself getting stung by a plunge but the latter will obviously be more attractive to the punters.  Get them back on course and betting on course.  It would be up to Clubs what they offered but say you gave a 6% rebate and increased your on course turnover by 110% you are ahead.  Meetings with big meetings elsewhere would really lend themselves to it(Cox Plate day for instance or Melbourne Cup day - an NZ Club with a race date then is going to potentially cop some dosh through the chaff cutter!  And people attract people - if you promote it well enough it will snowball.  In fact say the Greymouth Jockey Club wanted to run a promotion on Melbourne Cup day without a raceday - get the big screens going and the piss flowing, prizes for the flashest dolly or whatever.

No doubt the TAB oncourse operations run at a big loss so why not farm them out?  Let the Clubs organise their own commentators(within reason of course) PA systems and communications (Radio Telephones for the admin stipes starter etc) - all of which the TAB deal with at the moment.

Actually wouldn't it be great to get a setup like racenet letting you find the best odds over a range of agencies? 

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Reefton,

The way I see it most of the agencies work in tandem so can't really see where there would be price variations with automated fixed odds.

Phantom meetings used to be a common occurrence in Asia. Certainly on Melbourne Cup days could be successful. 

Club running their own pools would still require the money transaction services from the TAB. Oncourse pools should promote attendance and the sponsors not just gambling.

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1 minute ago, The Centaur said:

Club running their own pools would still require the money transaction services from the TAB. Oncourse pools should promote attendance and the sponsors not just gambling.

Why?

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1 hour ago, Chief Stipe said:

Why?

Obvious.... Rule 1. Don't reinvent the wheel. (TAB account services)

Clubs have run their own jackpot pools with say a car as prize  In fact I collaborated with a punter who won a car two years in a row.

 

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Would the incentive of better odds for on course punters and other % rebates etc,not be a draw card to get people racing?Also the % take from on line punters for clubs.

Edited by Mooncoin

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26 minutes ago, The Centaur said:

Reefton,

The way I see it most of the agencies work in tandem so can't really see where there would be price variations with automated fixed odds.

Phantom meetings used to be a common occurrence in Asia. Certainly on Melbourne Cup days could be successful. 

Club running their own pools would still require the money transaction services from the TAB. Oncourse pools should promote attendance and the sponsors not just gambling.

Well have a bloody look on racenet - there are significant variations all right(and if there aren't then why do people have multiple accounts with different agencies?)

As far as 'money transaction services' goes again it was not that long ago we had to fund our own totes(the club would write a whopping great cheque for the tote float the day before the races then get it back on race night or in the TAB settlement)

Promoting attendance and sponsors is all very well but if they aren't punting you are not making (much) money.   People attract people anyway so of you can get punters through the gate others will follow to see what's going on.  And decent punters want decent service - probably don't want every drunken know all Tom Dick and Herriet  but anyway -  hence talking (whimsically of course) about having access to a range of agencies.

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2 hours ago, Reefton said:

Well have a bloody look on racenet - there are significant variations all right(and if there aren't then why do people have multiple accounts with different agencies?)

As far as 'money transaction services' goes again it was not that long ago we had to fund our own totes(the club would write a whopping great cheque for the tote float the day before the races then get it back on race night or in the TAB settlement)

Promoting attendance and sponsors is all very well but if they aren't punting you are not making (much) money.   People attract people anyway so of you can get punters through the gate others will follow to see what's going on.  And decent punters want decent service - probably don't want every drunken know all Tom Dick and Herriet  but anyway -  hence talking (whimsically of course) about having access to a range of agencies.

The real proof would be getting on. Some bookies may not be up to date on racenet.

I look at racingpost bookies prices in UK and really the difference is only minor. When the main bookie changes the rest quickly follow.

Quite frankly NZ racing can't afford bookies. Its an extra layer skimming off profits. Racing doesn't need them. There was a time they added colour to a racemeeting but the corporates are just parasites.

With all the hooha about money laundering I don't think the government allow clubs to accept money independent of the TAB. A compromise would be needed.

Big punters wouldn't be interested in oncourse gimmicks but thats whats needed for the casual socializers.

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The Centaur you are right in that racenet is not live enough, I use dynamicodds and its very good, there are significant price variations on NZ  across the bookies and Betfair.

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NZ punters need oncourse Bookies, so that there is competition for the NZ TAB, who at the moment has a monopoly for gambling on racing and sports!

The customer has suffered substantially over the past few years due to the lack of competition to the NZ TAB.

Could someone please advise us who determined that Mr John Allen was worth over $650k per annum salary and what did  he do for that that large amount?

 

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1 hour ago, The Centaur said:

The real proof would be getting on. Some bookies may not be up to date on racenet.

I look at racingpost bookies prices in UK and really the difference is only minor. When the main bookie changes the rest quickly follow.

Quite frankly NZ racing can't afford bookies. Its an extra layer skimming off profits. Racing doesn't need them. There was a time they added colour to a racemeeting but the corporates are just parasites.

With all the hooha about money laundering I don't think the government allow clubs to accept money independent of the TAB. A compromise would be needed.

Big punters wouldn't be interested in oncourse gimmicks but thats whats needed for the casual socializers.

Well I've seen the variations with my own eyes the odd time I have had a look so my eyes must have deceived me(mind you I am not a big punter and do not have accounts with any of the others so the NSW TAB and NZ TAB will have to do)

If the bookies are paying the same amount of commission as anyone else of course NZ racing can afford them and anyway we have got them - witness the people(like Barryb just stated) who use them.  Bury your head in the sand all you like - they are a significant participant just at the moment a non paying one

Whether they are parasites or saints they are here and we are not getting our share of their takings(and Witless and his RITA friends are showing zero urgency to get us our share).

Re the hooha on Money Laundering the TAB isn't the only one caught there - we are too as are lawyers real estate agents stockbrokers or whoever.  If you are involved in an industry where the AML applies you are caught - they don't restrict entry to those industries but if you are in there you are expected to abide by the AML.  Clubs pay the wages for the raceday tote staff anyway so indirectly you have to deal with the AMLCFT Act in any case.

And I have already said that big punters don't want gimmicks(and probably don't want big crowds either but to grow more big punters you need to get them hooked(wrong word but you get the gist) and to do that give them an enjoyable time while they develop the necessary passion).  Big punters want decent service and decent returns(hence so many of them buggering off to other providers because of the slack attitudes and service of the NZ equivalent. 

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1 hour ago, Brodie said:

NZ punters need oncourse Bookies, so that there is competition for the NZ TAB, who at the moment has a monopoly for gambling on racing and sports!

The customer has suffered substantially over the past few years due to the lack of competition to the NZ TAB.

Could someone please advise us who determined that Mr John Allen was worth over $650k per annum salary and what did  he do for that that large amount?

 

Curious will confirm this. several years ago I kept up a barrage on Channel X trying to convince the "educated" that contrary to what the TAB was claiming the actual revenue turnover was about $400M not $2billion as all the CEO's, board members etc were claiming. The message has now sunk in but the employment agencies and consultants still were claiming $2billion turnover. Just imagine if every table, machine in a casino submitted turnover as revenue then the amount would be astronomical. John Allen was hired by agents claiming the TAB was a $2billion company.

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14 minutes ago, The Centaur said:

Curious will confirm this. several years ago I kept up a barrage on Channel X trying to convince the "educated" that contrary to what the TAB was claiming the actual revenue turnover was about $400M not $2billion as all the CEO's, board members etc were claiming. The message has now sunk in but the employment agencies and consultants still were claiming $2billion turnover. Just imagine if every table, machine in a casino submitted turnover as revenue then the amount would be astronomical. John Allen was hired by agents claiming the TAB was a $2billion company.

Centaur, do you know what Mr John Allen did for his $650k plus salary?

Yes he may have gone to meetings around the country but what does he actually do to warrant that amount of money?

Punters that are allowed to offload with the NZ TAB pay his and other execs salaries from their losses.

What is it that the TAB executives actually do each and every day?

 

Edited by Brodie

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10 hours ago, The Centaur said:

Curious will confirm this. several years ago I kept up a barrage on Channel X trying to convince the "educated" that contrary to what the TAB was claiming the actual revenue turnover was about $400M not $2billion as all the CEO's, board members etc were claiming. The message has now sunk in but the employment agencies and consultants still were claiming $2billion turnover. Just imagine if every table, machine in a casino submitted turnover as revenue then the amount would be astronomical. John Allen was hired by agents claiming the TAB was a $2billion company.

You better update your knowledge of accounting terms.  Turnover is gross income(effectively sales).  What you are talking about is gross profit which is effectively sales less direct expenses(in this case the payouts on the betting).  You have a reasonable point but they do not mislead by saying turnover is $2m(if indeed it is $2m)

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21 minutes ago, Reefton said:

You better update your knowledge of accounting terms.  Turnover is gross income(effectively sales).  What you are talking about is gross profit which is effectively sales less direct expenses(in this case the payouts on the betting).  You have a reasonable point but they do not mislead by saying turnover is $2m(if indeed it is $2m)

I think what The Centaur is saying is that the TAB focusses on Turnover (total sales) rather than Revenue BEFORE Expenses.  Theoretically you could have turnover (sales) of $3b and have no revenue if your bookies were total morons.

Plus it isn't the same as selling a loaf of bread where you can only sell a loaf once.  With wagering you make sale after sale of the same product with close to zero marginal cost.

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1 hour ago, Reefton said:

You better update your knowledge of accounting terms.  Turnover is gross income(effectively sales).  What you are talking about is gross profit which is effectively sales less direct expenses(in this case the payouts on the betting).  You have a reasonable point but they do not mislead by saying turnover is $2m(if indeed it is $2m)

Really? Sales is the same as gross income?

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1 hour ago, Chief Stipe said:

I think what The Centaur is saying is that the TAB focusses on Turnover (total sales) rather than Revenue BEFORE Expenses.  Theoretically you could have turnover (sales) of $3b and have no revenue if your bookies were total morons.

Plus it isn't the same as selling a loaf of bread where you can only sell a loaf once.  With wagering you make sale after sale of the same product with close to zero marginal cost.

The TAB says 'this is our Turnover'.  They are NOT incorrect in saying that.  I have been an accountant for 35 years and have no idea what you mean by the second part of your post.

If the Centaur wants them to report gross profit then that's OK the suggestion they are somehow overstating things or misleading people in the use of the word 'Turnover' is incorrect  

However taking gross profit is no more enlightening than turnover - the number you are looking for is Net Profit(Turnover less direct costs less overheads)  but  that takes time to work out(and some level of skill - hence why Accountants charge so much).  It is impractical on a Monday morning to  say 'this is our net profit for the weekend'.  To do so would involve an unacceptable level of estimation

 

 

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6 minutes ago, curious said:

Really? Sales is the same as gross income?

Well not always but as a rule of thumb sales would make up the bulk of gross income.  There may be other income items but in most business organisations sales would make up the majority of gross income.

You are not confusing the term 'gross income' with 'gross profit'?

 

Edited by Reefton

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2 minutes ago, Reefton said:

Well not always but as a rule of thumb sales would make up the bulk of gross income.  There may be other income items but in most business organisations sales would make up the majority of gross income.

You are not confusing the term 'gross income' with 'gross profit'?

 

In wagering turnover ISN'T gross income.  If $20,000 is spent on-course on betting and is turned over 5 times that is $100,000 in turnover which isn't gross income.  You can't magically create $80,000 in real dollars.

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14 minutes ago, Reefton said:

The TAB says 'this is our Turnover'.  They are NOT incorrect in saying that.  I have been an accountant for 35 years and have no idea what you mean by the second part of your post.

If the Centaur wants them to report gross profit then that's OK the suggestion they are somehow overstating things or misleading people in the use of the word 'Turnover' is incorrect  

However taking gross profit is no more enlightening than turnover - the number you are looking for is Net Profit(Turnover less direct costs less overheads)  but  that takes time to work out(and some level of skill - hence why Accountants charge so much).  It is impractical on a Monday morning to  say 'this is our net profit for the weekend'.  To do so would involve an unacceptable level of estimation

 

 

What we hear in New Zealand is the suits saying we have a multi-BILLION dollar wagering industry.  When in fact they only have a multi-MILLION dollar wagering industry.  The suits use turnover to justify their existence and salaries.

Compare that to what Racing Victoria has reported which is copied into a thread on this forum.  In their summary they don't mention TURNOVER once but talk constantly about REVENUE which is Gross Sales.

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No. I am not confusing them.

If my bread shop sells a loaf of bread for $2, then my gross income from that sale is $2 isn't it?

If for my VIP customers I sell the loaf for $2 but give them a $1 rebate, then is my gross income $2 or $1?

I would consider that the gross income of the TAB is the sum that they take in after the running of each event which for a standard race might be around 20% of betting turnover.

The betting turnover maybe $2 billion but the gross income is $400,000 as Centaur says and I think it's verging on fraudulent to promote the TAB as a 2 billion dollar business.

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