The Horse Business Essay Example for Free

The Horse Business Essay Introduction The Horse Industry is unique. Throughout the world, people use horses for consumption as well as for non-consumption purposes. Horses are bred either for the purposes of horseracing – an internationally popular sport, or for purposes of consumption particularly in countries where horsemeat is considered a delicacy. Breeders rear thoroughbred horses specifically for racing purposes. A horse is a very viable and valuable commodity, so much so that commercial insurance policies customarily offer protection for owners of high quality racehorses against theft, injuries and other diseases. The government of the United States and several European countries maintain strong controls on horse reproduction. There are governmental limitations on the use of artificial insemination and sometimes owners have to register their horses. Evidently, this industry is unique and reaches across the private as well as the public sector. Racing is an entertaining and interesting business (Chenault, 1994). Those involved in the horseracing industry are always keen on increasing their horse’s abilities so that they may attract a broader consumer base and thus increase their returns from horseracing. These owners therefore explore numerous and varied opportunities to profit from their racehorses including investigating other racing choices such as simulcast races, which involve off-track wagering. Slaughterhouses slaughter, for consumption, horses which have outlived their usefulness, and are in poor health condition. Customers who use horsemeat in their diet purchase the slaughtered meat in large quantities (House of Commons Hansard, 2002).   The main objective of this paper is to highlight those strategies and techniques of business that can contribute to improvements in the horse industry for the firms in either the public or private sector who are involved with the racehorses or slaughter of horses. This research will seek to discover ways that this industry can become more efficient as well as examine the existing or needed policies that could contribute to the necessary improvements. Problem Statement Horseracing and the slaughtering of horses are two key industry areas involving the use of horses and both private and public sector corporations have some amount of share in either industry area. As with any other animal group it is no surprise that there is a continuing debate on the ethics of both horseracing and horse slaughtering for consumption. These twin industry areas have been the targets of concerns raised on the ethic of slaughtering horses, particularly those that would have previously been used in the horseracing industry but which are no longer of further use to their owners for a variety of reasons. These horses may be diseased, injured or ill and have little prospect for future recovery. To ensure that they do not suffer a complete loss, owners of racehorses sell these unwanted horses to slaughterers. Some people are totally against the slaughtering of horses. In America and European countries, horsemeat is comparable to the meat of other large animals such as the buffalo, goat, sheep, pig and others. Since people throughout the United States and Europe desire to have horsemeat as a part of their diet then naturally, the slaughter industry too has its own place. Thus, while persons object to the slaughtering of horses, there are those who have little or no objection to the consumption of horsemeat. Similarly, there are objections to the use of horses for racing because of the reported cruel treatment of these animals and their injection with dangerous substances and steroids to enhance performance. This is a very sore issue in the horse industry. Even sorer is the slaughtering of these horses when they are no longer profitable in the horseracing industry. This debate is challenging the viability of the equine industry, putting industry shareholders in an uncomfortable position. Both the racehorse and the slaughtering industries are producing at their full capacities in the US and the rest of the world. Like any other business these industries whether private or public need to adopt sound business management strategies through appropriate training so as to be good in business and to provide the best service to buyers and consumers. The care and the right use of horses is also the matter of concern. The primary use of horses is for racing. However, one cannot avoid the fact that the slaughterhouse, rather than the racecourse, becomes the home for horses unfit for racing. Every year, the number of unfit horses increases thus the number of slaughterhouses also increases. Slaughter industries in the public and private sectors purchase the unwanted horses. Traditionally, the hunter-jumper market has acquired most former racehorses that have no signs of muscular-skeletal abnormalities, and some use previous standard-bred racehorses for driving carriages. Horses that obtain career-ending injuries are not useful anymore for the owners and fall into the category of unwanted horses. Figures produced by the U.S. department of agriculture reveal, however, that the majority of horses slaughtered (92.3%) are quite healthy and not, in fact, neglected. An overwhelming majority of Americans and members of Congress oppose slaughtering horses for human consumption (HSUS, 2007). One of the options in dealing with these unwanted horses is for slaughtering and distribution for consumption. The precise number of horses that make up this category of unwanted is unknown. However, some research reveals that 50,000 horses fall to slaughterhouses each year in the USA. The real number of unwanted horses is much higher than that reported. Horses used on farms are costly to owners, specifically maintenance costs for food, wastage disposal and land use. The slaughter industry appears to be the most attractive option in dealing with these horses. Purpose Statement The basic aims of the study are to suggest methods of enhancing business productivity for persons involved in slaughtering or horseracing within the public and private sectors and to identify better ways of setting goals and objectives for their racehorses. Additionally this paper will attempt to identify and recommend alternative uses for unwanted horses besides slaughtering. The research will be dealing with both facts and numbers from the available resource material as well as opinions and comments from surveys. Therefore, this paper will adopt a mixed research method using both quantitative and qualitative techniques. American horse council estimates that almost 10% of all the horses die every year due to illness, injury, lack of proper environment and food provisions. There is a need for proper treatment and laws from the government to support the cause of increasing horse reproduction. California passed a law in 1998 protecting against horse theft and this has been effective in reducing such theft. Additionally regulations need to govern management aspects of the horse industry. Often the lack of proper means of transporting horses for slaughtering has contributed to the unnecessary death of horses. The usual means of transporting horses are more suited for shorter and smaller animals such as cows, pigs and cattle. These transported force horses, which have a longer neck and body, into these cramped positions often causing injury. Those involved in the transportation of horses and are unable to afford the proper form of transportation have very little alternative and thus horses continue to suffer and their numbers decrease. The Government could provide subsidies to such persons working on small-scale to fulfill their needs. Forces of demand drive the market. Consumers world over with affirmative attitudes and who demand that meat products are nourishing, tasty and of the best quality, and reasonably priced relative to income, availability, quality and relevance to life-style remain the leading driving forces in the market. However if discussions on meat production in developed countries raises speculation this could negatively affect demand negatively. In this regard, government has to seriously consider and reconsider their policies towards this industry. Undoubtedly, the meat industry not necessarily need information awareness programs but need to modify practices in order to satisfy fully customer needs. In fact, technologists and scientists can contribute positively to this industry by developing newer strategies that are more efficient. These strategies include applying practices that result in less environmental damage, depend less on stimulants and additives, and that consider sensitive exploitation of the new genetics and with more consideration for the animals involved. Research Questions The following questions will guide the research: What are some guidelines for success in the horse industry? What are some key principles of the horse industry? What business ethics govern the horse industry? What alternative exist for racehorses that are no longer useful for racing? The research will also attempt to find out what are some of the business ethics, social stewardship, business leadership/management and stakeholder values for the Racehorse Industry, the Slaughter Industry and the Private sector? Proper ethics should govern and guide the operations of the private sector, the racehorse industry and the slaughter industry in their business management strategies in order to ensure effective leadership and social stewardship. A prospective entrepreneur in the racehorse industry should consider all necessary information to determine the size of the market and the possible share of his prospective business within the market. There should be some insurance plan for such businesses. The major point in focus for any business holder around the globe is to maintain profit. The ways to success are confusing and indefinite. â€Å"The NFIB estimates that over the lifetime of a business, 39% are profitable, 30% break even, and 30% lose money† (Blue Ribbon Consulting, 2006).    Core Literature The racehorse industry has been demonstrating positive levels of success and has had a considerable impact on the market overall. A 2003 summary report provided by the Louisiana State University summarized the successes and contributions of the horse industry as follow: â€Å"The race horse industry is composed of 1,178 breeders who own 10,161 mares that produced 5,971 foals that were sold in 2003 for $35.8 million. These breeders own 1,977 stallions that were bred to 5,313 mares, generating income from stud fees of $13.3 million. The total income generated from racehorse production was $49.1 million. An additional 2,229 racehorse owners owned 10,903 racehorses in training or on the track at a value of $109 million. The impact of racehorse owners and breeders’ activities in 2003 was $158.1 million. The show and competition horse industry (horse shows, barrel racing, cutting, roping, team penning, etc.) is composed of 2,600 breeders who own 7,847 mares that produced 4,901 foals that were sold for $14.7 million. These breeders own 718 stallions that bred 8,351 mares, generating $12.5 million in income from stud fees. The total income generated from show and competition horse production was $27.2 million. Another 4,634 owners compete on their 14,901 horses valued at $59.6 million. The total impact of the show and competition horse industry is $86.8 million. A large portion of the horse industry is recreational. The horse is used for comfort, exercise and enjoyment. About 20% or 8,570 of the recreational horse owners bred 21,554 mares and sold 11,392 foals in 2003 for $17.1 million. These horsemen own 933 stallions that were bred to 5,924 mares, generating income from stud fees of $592,400. The total income from production in the recreational horse industry was $17.6 million in 2003. Another 25,453 recreational horse owners have 61,366 horses valued at $61 million. There are 129,022 registered horses in Louisiana, owned by 45,331 horsemen. These horses are valued at $324 million. An additional 70,000 grade and other equines are owned by 25,000 people who have a $210 million impact on the economy. In addition to the value of horses produced and maintained in Louisiana, the activities of the horse industry generate a tremendous cash flow. The four racetracks employ 3,000 people and generate expenditures of about $1 billion per year. The show and competition industry conducts an estimated 500 activities per year and generates $12.5 million in expenditures. With the value of horses, expenditures on horses and the activities in which they engage, the impact of the horse industry is estimated at $1.6 billion per year.† (LSU, 2003). Apparently, the industry is heading in a positive direction. However, there needs to be better regulation of the industry, particularly in the development of appropriate business ethics to govern those involved in the industry. Sensible business ethics are one of the keys to organizational success. As a corporate strategy businesses involved with horses should lobby for effective legislation to protect the consumer, the business owner and the horse. In the U.K., for example, all horses are required to possess a passport according to a legislation that came into effect on 31 December 2003. Other European countries have similar requirements. Even though horse owners previously registered horses this was on a voluntary basis for horses born after 1 January 1998. The new requirement ensures that all horses, particularly those specifically reared for the purposes of slaughtering and consumption, have a passport containing a history of veterinary medicines so that certain medicines do not pass along the food chain to humans. This requirement is also a more effective way of controlling over breeding in certain areas (Defra, 2002). Policies such as these are useful guidelines for conducting business so that managers adopt correct strategies in all aspects of the industry. Organizations must provide these business ethics and rights to employees (as well as to the livestock of the agriculture or farm industry) to safeguard their needs, to maintain friendly working environment, and to provide boost to a certain industry. Managers cannot anticipate that there will not be challenges in implementing certain principles that will contribute to eventual organizational success. Jonash (2005) warns that business owners need to be willing to face the challenges that go along with difficult business decisions and strategies. He holds that achieving short, medium and long-term success is not easy. He suggests that managers accept the reality that there are no quick fixes to organizational problems and thus should be willing to follow through with tested and proven strategies even if the implementation process seems difficult. The above-mentioned statistics show clearly that this system is working very well in the US and can even improve if the overall racehorse industry follows proper policies and procedures. Research Activities/Methods The research activities of the paper under study are mainly through the books and Internet and other credible journals. These research materials are primary sources of information as they are already from the credibly written scholarly articles and journals. However, the point of view is solely from the writer’s perspective. Operational Definitions Livestock: farm animals Slaughter: using an animal for food. Equine: Of or like a horse (adjective) Simulcast Races: Races broadcast across the world and seen in casinos.    Assumptions and limitations This paper assumes that the horse industry can benefit from promotions and other ad campaigns. The scenarios, the examples and data are the tools that will make this study a success. This study is limited to the racehorse and slaughter horse industries, the business leadership skills and the methodology of the management and leadership. The horse industry has many problems like the transportation, accommodation, handling the lack of subsidies granted and others, but these are just a few. There are many more topics and issues surrounding this industry but those are beyond the scope of this paper.    References Blue Ribbon Consulting. (2006). Horse Consulting. Retrieved Sep 22, 2007 from, http://www.horseconsulting.com/services.htm. Chenault, E. A., (1994, Oct 28). Race horse industry analysis featured in Jan. 14 Meeting. Retrieved August 1, 2007, from, http://agnews.tamu.edu/stories/AGEC/horsrace.html DEFRA (Department for environment, food and rural affairs). (2002, Feb 14). Horse Passports and Database. News Release. Retrieved August 15, 2007 from, http://www.lipizzaner.org.uk/defra.htm. House of Commons Hansard. (2002). Written Answers. Retrieved August 21, 2007 from http://www.publications.parliament.uk/pa/cm200102/cmhansrd/vo020214/text/20214w39.htm. Humane Society of the United States, The (HSUS) Animal Net. (2007, Mar 17). HSUS responds to rumor of horse abandonment in KY: Calls it an act of desperation from the foreign-owned horse slaughter industry. Retrieved August 1, 2007, from http://archives.foodsafety.ksu.edu/animalnet/2007/3-2007/annet_march_20.htm Jonash, R. S. (2005). Driving sustainable growth and innovation: Pathways to high performance leadership. Handbook of Business Strategy, 6(1), 197-202.    Louisiana State University. (2003). Agriculture and natural resources summary: Horses. Retrieved August 15, 2007 from, http://www2.lsuagcenter.com/AgSum2003/narrative.aspx. Virginia horse industry board news and event calendar. (2007-2008). Retrieved August 1, 2007 from, http://www.vhib.org/virginia-horse-industry-board-news.html.