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8th July 2010, 13:22 #21
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I guess the economy is not exactly off topic as it is at the root of at least some of the major problems facing AOWR....
I have to at least partially agree with soCal. The economy is worse than many perceive it at the moment... I am self employed and have been my entire life (4th generation in a family horticulture business). The problem with this economy is that the last "boom" was not all that much of a boom for many sectors of the economy.... By the end of the boom, margins had shrunk tremendously due to increased production (at least in our industry) so profitability was already an issue even if cash flow was not. Much of the "prosperity" of the last boom was "on paper" and that supposed wealth has entirely evaporated but the debt it supported in both the public and private sectors continues.
Our business is down approaching 40% in the past 3 years and that is average for our industry in our region of the country - sadly enough our region is outperforming most of the rest of the nation in the horticulture industry. There is no realistic sign of recovery in our industry anytime soon. My ties in the business community seem to indicate to me that other sectors of the economy are in no better condition....
To top it off the someone decides to tell us the economy is IMPROVING because the unemployment rate has gone down because 1.5 million people GAVE UP??? The report actually said the economy lost 125,000 jobs last month but the unemployment rate went down??? HUH??? I do not pretend to know the answers nor will I speculate on the cause - but let be real and honest - the economy is terrible and it has a direct effect on the ability of any sport to attract sponsors and operate a profitable AND SUSTAINABLE enterprise....
To answer someones assertion earlier - yes, a 3% marginal tax rate could affect a business' ability to survive in this economy that has now been a mess for 3 years running with no signs of improvement... especially if you have tapped out your personal capital and depend on funds obtained from the banking sector too move forward/survive until the economy finally improves in 3-5 years.....
so yes, this is a MAJOR issue for the IRL (and will be for all other sports requiring sponsorship as time goes on and current contracts expire...)
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8th July 2010, 13:56 #22
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Originally Posted by elan 02
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8th July 2010, 13:58 #23
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bottomline is the D&G was delayed and hopefully eliminated when mom and the sisters removed the cancer
is there much still to do? obvioslt there is, it wont happen overnite......... but thankfully leadership has a clueSarah Fisher..... Team owner of a future Indy500 winning car!
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8th July 2010, 14:04 #24
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Originally Posted by SarahFan
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8th July 2010, 14:15 #25
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Originally Posted by Chris R
hmmmm....sounds like a AOWR attendance and TV ratings
maybe a couple forum memebers wrote the unempolyment report!
*ken ducks and runsSarah Fisher..... Team owner of a future Indy500 winning car!
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8th July 2010, 15:26 #26
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Originally Posted by SarahFan
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8th July 2010, 18:12 #27
Just to be clear, what I said was: "And any company whose business success depends on a +/- 3% change in the marginal tax rate..."
I didn't say or mean survival. We're talking about two totally different conditions there. If a business is in survival mode, then of course any incremental increase in after tax net (whether by way of a small tax cut or ANY increase in revenues) is going to be a big deal. That business is simply trying to make it to the next quarter... or maybe the next pay period. But that is not success. That is not a business that would suddenly be in a position to sign a strong sponsorship deal and then be able to actually activate that sponsorship, just because the marginal tax rate is 3% lower. That's a business with a sales or revenue problem, first and foremost. Even with a tax cut, such a business is, or should be looking to cut costs. And sponsorship, being an expense, would probably be the first line item to get slashed.
Is the economy hurting the IRL? Sure. It's hurting NASCAR, F1 and most every other series in the world too. But even before the recession, and when unemployment was much lower than it is now, the IRL was not growing and had NEVER turned a profit. The down global economy is simply highlighting a condition that already existed. And when I hear of sponsors, which HAD BEEN open wheel sponsors, signing deals with second tier NASCAR series (ya know... just cause the owner ASKED), it confirms that the problem isn't JUST the economy. If it's true that Izod is getting cold feet, I'd say it has more to do with the IRL's failure to deliver on the ratings and ROI front than it does with the economy.
Does the IRL have a sponsor contingency program? What's the official beer, hotel, airline, bank, auto parts supplier, etc. of the IRL? If they have any of those things, I've not heard a word about it. Keeping a sponsorship on the QT/down low is probably not the best way to maintain or get more sponsors. I don't know all that much about marketing or sponsorships. But I went to a sponsor round table in Charlotte years ago. And while it was mainly just for fun (and to get out of the office for a few days), it seemed pretty clear that sponsors wanted something in return for their $. Something more than just the satisfaction of knowing that they were enabling an otherwise broke team to field a car."Every generation's memory is exactly as long as its own experience." --John Kenneth Galbraith
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8th July 2010, 18:34 #28
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Jag, you say the IRL owners should be asking? I will just say provide me with proof they are not? Scotty spouts this crap off all the time that the team owners are whiners wait for the money to come to them. I would love someone to talk to a Roger Penske and say that, or a Jimmy Vasser.
I think the IRL is not a great product to put a lot of money into right now....the TV package doesn't work and THAT is the problem I think holding off any serious sponsors outside of some niche marketing."Water for my horses, beer for my men and mud for my turtle".
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8th July 2010, 18:38 #29
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I don't think most people realize how important it is for the IRL to post a significant improvement quickly.
They are planning on introducing a new engine and chassis package for the 2012.
How many teams can afford to basically toss their cars and parts and other sundry equipment in the garbage and buy all new equipment? Many teams today survive by buying used tubs and parts from other teams.
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8th July 2010, 18:42 #30
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Originally Posted by anthonyvop
At some point, a new car would have been required, and it has been postponed long enough. Pay up, or get out...."Water for my horses, beer for my men and mud for my turtle".
https://dirtfish.com/rally/erc/solberg-on-the-rocky-road-to-a-rallying-return/
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