lime rock aug 10th $335 this is getting out of hand

[driver1974]

any other thoughts

[RKramden]

It is a two day regional and only $40 more than the one day regional that NER ran.

It does seem strange that it is only 3 minutes more P&Q and only 5 laps more of racing, since it is a two day event.

The difference might be the Historics, which have Group 7.

Group 2 has 14 different classes, Group 6 has 13.

[Greg Amy]

I can understand needing to charge enough to cover the costs+; we all know how expensive this track is to race (and we've seen the general financial outlays for an event ad nausea...)

However, I wonder how these increasing entry fees will affect double entries? Will there be fewer SMMAITACs, or SSMs entering SM as well?

I, for example, was content to pay a marginal cost of $250 to run DP in addition to ITA at the July 4th event (http://www.kakashiracing.com/reports/2007lrp3a.html); however, I really can't see myself writing a check to the region for $670.

Something to keep in mind when determining pricing; as Mo-Hud unfortunately found out earlier this year, price most definitely affects demand, and I suggest we may very well be into the backside of that profit-maximization curve... - GA

[Eagle7]

any other thoughts [/b]

Yes, Mid-Ohio. :026:

[driver1974]

ok so its a friday saturday. still its 85$ more that the july 4th race

[dtanthon]

Where did you get $335?!?!?!?!

How much was the entry in 2006 = $280
How much is the entry in 2007 = $325

How much did rent and other expenses for LRP go up from last year? There were several posts on this site earlier in the year that had that information.

Also, entries are down across the country. Call Topeka and get the numbers. What numbers did we have last year at this event even with the additional group? Do the math to see the "backside of that profit-maximization curve." Profit wasn't included this year, survival as a region was the most used term at the pre-race meetings. Remember back in May what happened?

What is the only source of income for Regional races? Do you want to sponsor an event?

Please contact me if you want the breakdown of our accounting for this event. Get involved with your region and see what it takes to put on an event.

The July 4th race was mid-week without the A paddock, a different price schedule. What was the price for the one day event earlier this year ($295) at LRP? Make the correct comparisons.

Thanks,
Darrell Anthony
NNJR-RE
[email protected]

[dickita15]

Darrel is right. Same event attendance appears to be down this year about 10-15%, more for Lime Rock due to price and some of the other issues we have talked about here. For a region putting on a race and setting the entry fee is all about car counts. The fixed costs are huge and the incremental costs are small. The regions that race lime rock are doing everything they can to try to save this track as a place for club racing. The stakes are high as we saw with Mohud earlier this year; they will likely not be able to sponsor races in the future unless something extraordinary happens. NER on the 4th received a track rent discount due to having to deal with the ALMS transporters screwing up the paddock. It looks like NER still lost some money on this event.
The bottom line is yes the entry fees suck but if you want Lime Rock to continue to be a place for SCCA club racing then you need to support these events. We all have to make our own personal decision on what we are willing to pay, but the more drivers that avoid this event the more the cost will rise for future events. Any kind of boycott type behavior will have the opposite of the desired effect.

[JLawton]

ok so its a friday saturday. still its 85$ more that the july 4th race
[/b]


Come to Mid Ohio with the rest of us that weekend!!


Seriously though, I'm not going to Mid Ohio to avoid LRP, it's just a big event that I don't want to miss. But I'm with Dave Gran on the other thread. I love LRP and would pay the extra to go there!! And yes, my kidneys pay for a day or two after.............

[Greg Amy]

I hope I'm REALLY REALLY off-base here, but I sense a distinct lack of economic understanding:

- Entry fees are going up because of increased costs.
- Entry counts are going down because of increased entry fees.
- Because entry counts are going down, we have to raise the entry fee, causing decreased entry counts, causing increased entry fees, causing decreased entry counts, ad nausea...

The problem is that entry demand is extremely price-elastic; in other words, people will react significantly to a small increase in entry fees, to the point of possibly choosing to not buy. Yep, it's only $45, a mere pittance in the large-scale scheme of total costs to a racer, but everybody's got their 'tipping point', and we're getting damned close to that. "All I'm saying here" is that if you understand the economics, you may actually make more money BY SLIGHTLY LOWERING THE ENTRY FEE. Even pure monopolies cannot charge "whatever they want to" because at some point they begin losing revenue due to a decreased customer base (would you buy Windows Vista - purchased from a monopoly company - if it cost $10,000 per copy? No Mac or Linux jokes, please...).

I can understand how some folks may not understand or may disagree with this concept, but it's economic fact...

Couple that to the fact that a lot of your customer base is traveling to Mid-Ohio that weekend, and it's truly not looking good for NNJR.

Suggestion: consider LOWERING the entry fee, in order to attract more customers. If you lower the fee 5% and it results in 7% more entries (purely an example, not a suggestion based on any facts or research at all), you will make MORE revenue (ergo, more profit, assuming there's not a commensurate increase in variable costs). Suggestion #2: offer a discount for multiple entries, i.e., $325 if I enter ITA, and only $250 if I enter DP as well (same car, same driver). SURELY your marginal costs for another DP entry are significantly less than $250, therefore you offer me an incentive to enter DP and you make more marginal profit, whereas I am highly unlikely to enter DP at $325 and you "lose" that marginal profit.

If you don't understand these concepts, then we're doomed to losing money racing at this track.

Finally, using the "you gotta support us!" trump card won't work here; for the most part it simply offends the entrants. We're not entering events to support the region; we're doing it because we want to race. If we choose to not race (for whatever reason) then the core purpose for having that event is lost. Sounds cruel, sounds like I'm an a-hole, but at that point the event(s) should be abandoned, or the region(s) should charge each member an annual fee to subsidize the event(s).

Greg, who's not "boycotting" ANYTHING, rather preferring to choose a substitute product (Mid-Ohio) versus the heretofore somewhat-monopoly of running that weekend at LRP...economic reality sucks.




What numbers did we have last year at this event even with the additional group?[/b]
On edit, another comment on this.

This illustrates yet another economic misunderstanding. In order to get the car counts up, you added another group (historics). In order the increase revenue, you increased entry fees. So, for the racer that's been going to LRP for years, you've not only increased the costs but you've decreased the available track time, significantly decreasing the value of that entry.

So, it's not just $45, is it? It's $45 plus less track time.

As has been said many times before, racers are more than willing to pay extra fees for extra track time (witness the number of people willing to pay DOUBLE the entry fee to have double the track time, by entering two groups). Yet, it's fairly oblivious to economic reality to expect racers to want to pay extra money for less track time...

We're in an economic death spiral right now...time for someone to pull back on the yoke, the ground's coming up fast...

[Andy Bettencourt]

Greg's points are spot on economically, however the real wildcard is that we have an 'owner' that can go bankrupt with only a slight miscalculation. I would like to see what kind of turnout this event would have:

Regular Regional Weekend (ie: non holiday)
Regional not sandwiched in between two other Regionals in the same series
$225 first entry, $175 second entry. Call it 'Bargin Basement Weekend'
Schedule pre-race track rides in street cars at 8:30am to create some fun

This would seem to allow for the most possible 'demand'. Would this generate enough to make it viable? How much cost do we have to cover again? I think Dick's point on the 'boycott' issue is that we shouldn't just boycott to send a message because it becomes a self-fulfilling prophecy. Don't go if you reach your tipping point, but don't NOT go just to send a message - becasue there is nobody at LRP listening.

[Jeremy Billiel]

We have discussed this before and apparently will again and again. Greg is dead nuts on target with his economic lesson.

Here's my bottom line (no pun intended). I simply do not care about regions or who is hosting the event. I go to which ever event is more fun and will give me the best bang for my buck. i.e Track Time. If that is a double event at a higher cost so be it. The expense to travel is the fuel for the truck, hotels and food. Once these are sunk I am looking for track time.

Mid-Ohio is were I would have been going to if my wife didn't want to take a vacation (Silly her)! Has anyone done the modeling of fixed and variable costs to appropriately price the entry fees? Silly question, but as I learn more and more about the SCCA, its not out of the question.

One final thought: The regions in the New England area need to take a serious look at what is going on. IMHO the absolute best scenario is the merge the regions and put what they all do best together. This may sound like a long shot, as it is, but if we have 3 or 4 regions, all with no money, and can't afford a loss how do you prevent that? Create a bigger region with the ability to absorb fluctuations. If this was the business world, mergers of the regions would have happened 2 years ago...

Create economies of scale and lower your fixed costs. Those are the options that we can control as a group.

[gran racing]

One other solution I've heard but didn't like so much at first is "offer less events".

[dtanthon]

FYI - The Historic Group has been invited to this event for years. Well before my being RE. Look at the past August events.

Thanks,
Darrel Anthony
NNJR-RE

[dickita15]

The problem with Greg’s analysis is while his economic theory is dead on when he speculates about the specific percentages the facts are not there. NNJR has set a conservative price compared with fees the last 2 years, it is just that no price at Lime Rock in this day and age is going to look good. NNJR is $65 less than the mohud event and it is still a lot of money. Merging the regions does not change the economics. The events still have to break even on an average.

Dave is right if nothing else changes the number of SCCA races will in the long run be what the market will support.

Finally anyone who thinks for a minute that the people from the four regions that try to but on events at Lime Rock have not spent a lot of time and effort in considering the different scenarios and ways to make these events work for the sport are just so far beyond ignorant and arrogant I just can’t take it.

[dtanthon]

With the way things are going there will be less events in 2008.

[Greg Amy]

Well, from my "ignorant ivory tower", it ain't workin' so it certainly looks like we're at an impasse, doesn't it? Problem is, when no one shows up the drivers only lose track time; the regions stand to lose financial solubility...

But, you guys seem to have a handle on it, so I'll be on my merry way.

[RKramden]

One final thought: The regions in the New England area need to take a serious look at what is going on. IMHO the absolute best scenario is the merge the regions and put what they all do best together. This may sound like a long shot, as it is, but if we have 3 or 4 regions, all with no money, and can't afford a loss how do you prevent that? Create a bigger region with the ability to absorb fluctuations. If this was the business world, mergers of the regions would have happened 2 years ago...

Create economies of scale and lower your fixed costs. Those are the options that we can control as a group.
[/b]

Jeremy,

I'll go off track here a bit to offer a historical viewpoint.

At one time, when Nick Craw was in charge at the National Office, he was pushing to have New England Region broken up into SMALLER regions.

Why? Because as one of the largest regions in the country, it was felt that NER had too much political power as compared to the national office. A bunch of small, independent regions are a lot easier to control than one large region.

I would also expect that the regions in areas 2 and 10 would not like having a "super region" as part of the division. There is already way too much of an "800 pound gorilla" attitude that hurts the relationships between the regions despite the fact that at many times NER goes out of its way to do something less than optimal for itself to not hurt the other regions.

Add to this the fact that much of the functioning at the division level operates on a region by region basis (e.g. each region gets ONE vote), regardless of size, and the combining of regions would result in the area going from four votes to just one. Then small regions that don't even run races could vote against this one region and really mess up their racing program.

I don't think the idea of having a merger is really likely to happen as National would block it, the division would block it, or (by its current rules) prevent it from being functional, and it probably wouldn't make sense from a local area as each of the local areas (NJ, NY, New England) have very different goals in many areas.

What might make sense (and be actually do-able) would be a tightly structured CO-OP agreement between the regions that addresses each of their goals and helps them work towards reaching the common ones without impacting those that are local. But, for that to happen, some of the regions are going to have to learn to change they way they do things, and that is doubtful.

[Andy Bettencourt]

So we know that the PTB have seen it coming, hashed it out and here we are. What is the best solution? I think we can agree that if we go to less events, that the SCCA will not get those events back. This year we have 5 weekends there...should we go to 3? Make them doubles? How do we get people there? Maybe we don't want to be there - so what does road racing look like in the NE running on Rovals?

Maybe LRP is just forcing us out with or without them knowing it. I hope they do. I hope the PTB have sat down with LRP management and asked them WHY they have to charge us so much. If it's just for profit, the 'SCCA history' section of their book/DVD is horse-puckey...

What the heck do we do given the economics of the Regions/Drivers? Is it just a dead issue and will just fade away?

[Jeremy Billiel]

Jeremy,

I'll go off track here a bit to offer a historical viewpoint.

At one time, when Nick Craw was in charge at the National Office, he was pushing to have New England Region broken up into SMALLER regions.

Why? Because as one of the largest regions in the country, it was felt that NER had too much political power as compared to the national office. A bunch of small, independent regions are a lot easier to control than one large region.

I would also expect that the regions in areas 2 and 10 would not like having a "super region" as part of the division. There is already way too much of an "800 pound gorilla" attitude that hurts the relationships between the regions despite the fact that at many times NER goes out of its way to do something less than optimal for itself to not hurt the other regions.

Add to this the fact that much of the functioning at the division level operates on a region by region basis (e.g. each region gets ONE vote), regardless of size, and the combining of regions would result in the area going from four votes to just one. Then small regions that don't even run races could vote against this one region and really mess up their racing program.

I don't think the idea of having a merger is really likely to happen as National would block it, the division would block it, or (by its current rules) prevent it from being functional, and it probably wouldn't make sense from a local area as each of the local areas (NJ, NY, New England) have very different goals in many areas.

What might make sense (and be actually do-able) would be a tightly structured CO-OP agreement between the regions that addresses each of their goals and helps them work towards reaching the common ones without impacting those that are local. But, for that to happen, some of the regions are going to have to learn to change they way they do things, and that is doubtful.
[/b]

I appreciate the historical knowledge. I did not know much of what you explained, but isn't this a political reason to not merge and not a business reason? Does a region have to go bankrupt before the writing is on the wall?

[JohnRW]

When discussing the economics of club racing, don't forget the other 'elephant in the room': As a club, we're racing too much, and that is killing us.

Think of Greg's example of asymmetric elasticity, and stretch that out a bit. If we had LESS weekends to race, it would increase the number of entries on those weekends where we WERE racing.

For racers, why is "LESS" a good thing ? On the surface, it doesn't sound like it, but read on:

MORE racing thins out the fields at individual weekends. People can pick and choose "when & where", so they'll just bypass weekends and tracks, as any consumer would do.

MORE racing forces Regions to "compete" for entries with each other, taking bigger and bigger financial risks as the fields thin out and costs increase.

MORE racing puts a bigger strain on the other race specialties - when's the last time you heard somebody say "oh, yeah...we've got PLENTY of flaggers..." ??? Our current economics are based on volunteer race staff - aka "friends & fans", and once they're burned out and gone, we're going to be PAYING for those services.

And, of course, MORE racing raises the cost of full participation in our Regional and Divisional series' for drivers. They're REGIONALS for chrissakes...we're not trying to get to the RunOffs, and we don't want to spend thermo-nuclear $$$ to run at the front of a Regional/Divisional series.

As a Club, we're racing TOO MUCH (IMO). It's gotta stop...but nobody really wants to talk about this. Every Region has a self-interest in "more racing...for OUR Region", but it's going to be at the expense of all of us very soon.

The answer is "LESS".

I can hear the crying now - "If we give up those dates, we'll NEVER get them back". OK...gotcha...good riddance...either we give up those days on our own terms, or we lose those days due to our own financial failure. I know which one I'd pick.

Needless to say, this line of thought has not made me very popular with a lot of Admins when I lead the discussion in that direction. Oh well...

[RKramden]

I appreciate the historical knowledge. I did not know much of what you explained, but isn't this a political reason to not merge and not a business reason? Does a region have to go bankrupt before the writing is on the wall?
[/b]

Yes, but the landscape of inter regional and divisional politics has real interactions with the business decisions. What may be a good choice in strictly the business case may not be a very good choice politically. Divisional operations, and even the NARRC rules are very political, and not based on business decisions at all times.

Said another way, I think that the political situation on many levels has a significant impact on the range of business options available to each of the regions. We (the regions) cannot make business decisions in ignorance of the politics of the situation.

Regions are not businesses, they are clubs, and each is part of a larger club. And sometime that makes things weird.

"Why is life so hard? Oh, yea. There are people involved."