Do clubs make a profit?
Discussion
I have been looking at some race meeting entries and wondering how many of the UK's race clubs actually make money at the end of the year.
We have all seen meetings run by some clubs with less than 50 entries, and given the ever increasing circuit hire fees and other expenses I wonder how some of these meetings can break even. Ive listed below the clubs I can think of in the UK so would be interested for everyone to put them in order of profitability.
In no specific order
BARC
BRSCC
MSVR
360MRC
750MC
CSCC
DDMC
CCRC
HSCC
MGCC
I would be interested to see what people think, and if it matches up with what I was thinking.
We have all seen meetings run by some clubs with less than 50 entries, and given the ever increasing circuit hire fees and other expenses I wonder how some of these meetings can break even. Ive listed below the clubs I can think of in the UK so would be interested for everyone to put them in order of profitability.
In no specific order
BARC
BRSCC
MSVR
360MRC
750MC
CSCC
DDMC
CCRC
HSCC
MGCC
I would be interested to see what people think, and if it matches up with what I was thinking.
I'm sure that all clubs try to make a small surplus each year, and I use that word rather than profit on purpose. The idea will be to generate funds in the bank to cover the inevitable losses that some meetings will make, and to cover the costs of a cancellation due to unforeseen circumstances.
Clubs will also know that some meetings are more popular than others, ie some will make a surplus because good entries across all races will generate more £ than the meeting costs, but some meetings will not be so popular and make a loss, but most clubs still need to have a geographic spread of meetings.
Running a race club is a difficult business, and if it we're truly a business, not many would do it, I think. There's easier ways to make £. A meeting at Rockingham a few years ago cost about £76k, all in, for a 2 day meeting for example, and you have to have virtually full grids across the board to get that back.
Donington, Silverstone, Brands, Oulton are all expensive circuits but racers want to go there. Mallory, Anglesey, Pembrey are cheaper but often struggle for grids. Clubs will also usually decide to have a similar entry fee across all the circuits (give or take £20) so you can see some meetings will subsidise others.
One other thing that most people don't realise is that circuits usually demand their payment approx 6 weeks in advance - so clubs may have to find £25k per race day to pay the circuits before they have received the vast majority of entry fees.
As i said, it's a difficult business!
As for your question about ranking the clubs in terms of profitability, I'm really not sure but it's widely known that the the BARC lost approx £2M over a 3 year period recently. 750mc has very good cash reserves and so does the HSCC, I think, and CSCC has made a small surplus most years over the last 10 bit has nowhere near the cash reserves of those two mentioned, but then they haven't been going very long.
Clubs will also know that some meetings are more popular than others, ie some will make a surplus because good entries across all races will generate more £ than the meeting costs, but some meetings will not be so popular and make a loss, but most clubs still need to have a geographic spread of meetings.
Running a race club is a difficult business, and if it we're truly a business, not many would do it, I think. There's easier ways to make £. A meeting at Rockingham a few years ago cost about £76k, all in, for a 2 day meeting for example, and you have to have virtually full grids across the board to get that back.
Donington, Silverstone, Brands, Oulton are all expensive circuits but racers want to go there. Mallory, Anglesey, Pembrey are cheaper but often struggle for grids. Clubs will also usually decide to have a similar entry fee across all the circuits (give or take £20) so you can see some meetings will subsidise others.
One other thing that most people don't realise is that circuits usually demand their payment approx 6 weeks in advance - so clubs may have to find £25k per race day to pay the circuits before they have received the vast majority of entry fees.
As i said, it's a difficult business!
As for your question about ranking the clubs in terms of profitability, I'm really not sure but it's widely known that the the BARC lost approx £2M over a 3 year period recently. 750mc has very good cash reserves and so does the HSCC, I think, and CSCC has made a small surplus most years over the last 10 bit has nowhere near the cash reserves of those two mentioned, but then they haven't been going very long.
if you want some idea of cost, when i rented Spa for a race the circuit hire was 250 a minute... then you have to add admin costs, msa cost, clerk and scrutineer costs etc etc so its needs something like 40 cars at a reasonable cost to cover the costs, a full grid of 60 cars and you make some profit, less than 40 
and its an expensive week out....
and its an expensive week out....The basis for your list is somewhat flawed.
For example under the blanket 'MSVR' banner operate a number of clubs. Some of them highly successful - some of them not so.
Looking for strapline figures for 'promoter' organisations such as MSVR / BRSCC will not give you the accuracy you may be looking for.
For example under the blanket 'MSVR' banner operate a number of clubs. Some of them highly successful - some of them not so.
Looking for strapline figures for 'promoter' organisations such as MSVR / BRSCC will not give you the accuracy you may be looking for.
MSVR may have a long list of championships, but some they control and some are merely affiliated with them, but are actually independent. One such example is F3 Cup which is MSVR's own championship, but Monoposto which race mostly with MSVR is merely a customer buying track time and MSVR have no say in the actual running of the championship.
The clubs need to make a profit and to keep a significant amount in reserves, for financial security.
The clubs need to make a profit and to keep a significant amount in reserves, for financial security.
Edited by andrewcliffe on Tuesday 15th September 10:26
MSVR is probably not the best club to look at in relation to profit. As most of their events are held at their circuits the costs can be "moved around" also they don't have the issue of paying for a meeting (at their own circuit) up front. BARC are in a slightly similar situation, but all the other clubs have to pay up front. The same with some championships that run with another organising club. They have to pay a set amount usually well in advance and then it is left to them to fill the grid. (hence why sometimes you see races with small grids, organising club has got its £3000+ not really bothered if that championship puts out 6 or 26 cars)
Also worth noting that the purpose of many clubs is to run the events for their members, having a surplus at the end of the year means they can invest more into the next year or reduce fees etc. MSVR is a part of MSV and so I would assume that their purpose is to make a profit for their owners as it is a business and not a club.
For those championships who are big enough to be financially independent and who buy track time from the circuits and therefore hold the risk, but also the reward, these clubs need a considerable amount of money in reserve for their accounts to remain in the black - due to the nature of cash flow where you are paying out a considerable amount in advance, and recouping that from race entries, often up to the eve of the race. And when there is a number of races in close calendar succession, this can be a considerable amount of money sitting in an account.
However as well as the risk, there is the reward, where the club takes the profits from full grids of racing.
However as well as the risk, there is the reward, where the club takes the profits from full grids of racing.
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