V. Horse Related Businesses
main objectives of the horse-related business survey were to obtain information
on the types of horse-related businesses in Connecticut, ownership profile,
and economic characteristics - such as assets, number of employees, annual
revenues and annual expenses. The survey was pre-tested. A total of 550
business surveys were mailed out and 77 (14%) were received back.
The major categories of activities carried out by these businesses are
boarding of horses (25%), providing training and lessons (17%), and breeding
(16%). Also, in many cases, a business carries out multiple activities.
Most businesses are owner operated (89%) and horse facilities also tend
to be owned (83%) rather then rented. The average industry experience
of the owner is 22.8 years, but there is considerable variation in this
regard (as reflected in the standard deviation of 14.61). The average
business employs 1.6 full-time and 2.88 part-time employees (each of whom
works an average of 6.5 hours/week). This translates into an average of
2.068 full-time equivalent (FTE) employees.
The average number of horses kept (or used) in a business is 16.7, but
only 9.08 are owned by the business itself. Mixed breeds, Quarter Horses,
and Thoroughbreds account for 52% of these horses. The average market
value of total horses owned by a business is $58,536. Information was
also obtained for related business assets, like land, buildings and equipment,
as of December 31, 2002. As one might expect, land and buildings are,
on average, the most valuable assets. Finally, business owners were asked
to provide data related to revenues and expenses. The results obtained
are summarized in Tables 5-1 and 5-2. Average estimates for each category
of revenue and expense are reported.
Based on the above data, one could simply take the difference between
average total revenues and average total expenses (i.e., $45,920) to be
the average profits of a business, but this would not be right as in several
instances businesses provided data for only revenues (or only expenses).
The more correct approach would be to calculate profits of each business
from the raw data (when profits can be meaningfully calculated) and then
compute an average. With this latter approach, the estimate we get for
annual profits is $70,840 per business.
Table 5-1: Average Revenues by Category
Sponsor and Advertising
Table 5-2: Average Expenses by Catagory
Building and rental