Here’s a scenario: you own a big hardware store – 200,000 square feet of everything one needs for the home. Business is alright, but you’ve had your share of troubles.

One day, I come to you with a proposition. I will open up a tool and equipment rental shop in 50,000 prime square feet of your hardware store. You will upgrade and maintain the facility, pay construction costs and handle much of the overall marketing and promotion that takes place. In exchange, I will give you 20% of the revenue that comes in.

You think it over, and while you recognize that any success I have renting equipment will most certainly negatively affect your business, the offer is tempting as the upside is big.

We make the deal.

Things begin to hum along. Equipment rentals are becoming the norm as clients choose my business over yours. Soon we are expanding, from 50,000 square feet up to 100,000, to deal with the crowds. You see the revenues flowing and your business doesn’t try to compete with what I’m offering – after all, we’re partners. While the deal makes me almost four dollars for every one you bring in, you’re content as the money is strong and consistent.

Soon we’ve rolled out the concept in dozens of stores. It’s true that the focus on rentals has eaten away much of your hardware sales, but our partnership maintains jobs and everyone benefits.

One day, I start telling people that I’m fed up subsidizing your business. I turn my back on your role in the success, ignore the fact that contracts are still in place and forget the millions you poured in to make a go of this. As of this moment, I want it to end. Why should I be giving you anything?

If the situation with the Ontario government (me) and the horse racing industry (you) were a direct parallel to the scenario given, one would probably question the government’s desire to dispose of such a profitable partnership. But this demonstration is just the tip of the iceberg.

In fact, the deal the Government of Ontario has with horse racing is beneficial beyond just the economics of our flourishing partnership.

In addition to receiving 75% of all revenues (the local municipalities get 5%), the government of Ontario also earns $261 million in taxes directly from horse racing, 60,000 Ontarians are employed, producing $2 billion in economic activity.

Not only is horse racing a 200+ year tradition in this province, but with the right focus, there is a bright future. Ontario owned and bred racehorses can be marketed and exported all over the world. The signal can be sold globally with virtually no infrastructure or technology improvements. And person-to-person betting, the future of wagering, works better for our sport than any others. Best of all, this whole deal supports the second largest subsector of the province’s agricultural economy, keeping rural Ontario green and prosperous.

So why are we where we are? I’m not completely sure, but let’s find out, before it’s too late.

For the sake of horse racing, in all of North America, I encourage you to take action to make your voice heard in Ontario. Visit standardbredcanada.ca or page 16 in this issue for tips on what you can do.

Darryl Kaplan
[email protected]