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Andrew Chalk and Richard Brooks of Withy King

Economic pressures continue to affect racing

Economic conditions continue to take their toll on horse racing with over half (53 percent) of the trainers who took part in a survey by Wiltshire law firm, Withy King, admitting they weren’t confident about the business climate over the next six months.

One-fifth (21 percent) said they felt less confident than they did a year ago while 62 percent said they felt the same. Half (50 per cent) said their businesses were just breaking even while 23 percent admitted to being unprofitable.

The Racing Barometer survey of 550 UK trainers, including many in Wiltshire, was carried out by the specialist racing and bloodstock team at Swindon and Marlborough-based law firm, Withy King.

Commenting on the results, Withy King partner Andrew Chalk said: “It comes as no surprise that the sentiments expressed by those at the coalface in racing reflect those in wider society. These remain challenging times for all, but the results paint a picture of resilient trainers digging in and working hard through the recession, with many being innovative in the way they structure fees to attract new owners.

“As always, it’s a mixed picture.  Some trainers continue to find trading conditions very tough, but let’s hope that in time we will look back on this survey as showing the green shoots of recovery.”

Withy King partner Richard Brooks added: “We know that some trainers are plagued by debts owed by owners.  They are, in turn, living off credit given by their suppliers. We know of many instances of huge debts being built up with feed merchants and vets among others. 

“This in turn can generate closer scrutiny from the BHA’s Licensing department. We have seen in recent seasons that the BHA is willing to refuse licences on the basis that trainers do not have the skills or willingness to run a solvent business.

“But while there are some obvious difficulties, there is also a fair degree of optimism. We see a regular stream of new businesses started by some fairly savvy characters. A balance needs to be struck between keeping owners happy and having a business-like relationship that requires good cashflow.  The successful trainers maintain their cashflow with a keen eye on the business as well as their horses.”

The survey also blamed a lack of decent prize money for deterring owners from the sport. Over three-quarters (77 percent) of trainers who took part in the survey said the number of owners in their yard is affected by prize money levels.

Over half (51 percent) are seeing more shared ownership than they were a year ago; 57 percent said they had to offer discounts to attract owners to their yards. With prize money due to increase by 10 per cent in 2014, it’ll be interesting to find out whether trainers think this is likely to have any impact.

Withy King’s Racing Barometer is a new initiative designed to provide a real insight into the issues of the day and a snapshot of what it’s like to be a trainer in this economic climate. Trainers will be surveyed twice a year – in April and October.