1st February 2014, 01:06 PM
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Member
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Join Date: Nov 2010
Posts: 258
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Quote:
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Originally Posted by Rinconpaul
The trouble with their exchange business is they're only making 5-6.5% on half the turnover as opposed to having a 15% markup on 100% turnover if they just have a Fixed Price Tote. We all know that must be a successful business model as overseas bookies are trying to buy a share of the market.
A parallel might be CocaCola Amatil. They make 100's of millions in profit a year and own SPC Ardmona who allegedly lose millions each year. If they closed down, that'd upset a few people(aka Layers), but as a listed company with shareholders their charter is to make a profit at all costs.
I guess it's about economy of scale, Australia has a fairly small population of Exchange users compared with the UK, dunno? I hope not.
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to state the obvious they are 2 different businesses.
the closest thing, unless i am mistaken, that BF get to risk exposure is their best tote product. everything else they are facilitators .
corporate bookmaking is a much different beast with fixed prices, price assessment etc.
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