The company had a number of revenue streams including the hire of the circuit to race clubs. Although a core activity this was proving to be one of the least profitable income streams and the Board were considering discontinuing the activity. In favour of more profitable income streams
The challenge was to prove to the Board that the hire of the circuit to race clubs could be made more profitable and was an essential activity that should be continued. This was against a background of the race clubs pushing for a reduction in hire rates
I conducted a review of hire charges to ensure the rates were competitive in relation to the facilities on offer in comparison with other venues. Alongside this, working with the Operations Team I carried out a review of all costs associated with putting on a race meeting looking at ways to reduce.
The results showed that our hire rates were competitive but that we were overproviding in terms of the services we were offering as part of the package.
We were able to offer the race clubs a freeze on prices in return for a reduction in the level of services to the minimum required by our operator licence and 50% up front payment which helped improve our cash flow.
Most importantly profitability of race meeting improved by 30% leading to the Board to agree to continue to offer the service. No clubs were lost as customers and the number of events held has increased by 50% in the last 5 years.
Case Study: Andrew Lake