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Almost all the turnover and profits made by the Korea Racing Authority (KRA) comes from the revenue generated by betting on horse races.
But KRA Chairman Chang Tae-pyong is striving to change today’s betting-oriented business portfolio to diversify its revenue stream so that around 30 percent of its profits will come from new ventures in a few years time.
At the center of the new ventures are various measures to nurture horse-related businesses, Chang said in a recent interview with The Korea Times.
“Our sales based on betting show a clear sign of stagnating as the figure was 7.78 trillion won last year, up merely 2 percent from 2009. I expect things will not turn around abruptly in the future,” Chang said.
“To deal with the current stalemate, we need an entrepreneur spirit with which to turn our sights to other opportunities. One viable option would be to foster horse-related businesses.”
Traditionally, Korean livestock farmers have raised cows and pigs, which Chang claims creates relatively low added value. They were hit hard by the widespread foot-and-mouth disease (FMD) last year.
By contrast, horses are not prone to the highly-contagious disease and they also have rich industrial potential.
“Unlike other livestock raised mostly for eating, horses can meet multiple purposes including horse racing, riding, tourism and rehabilitation,” said the 62-year-old who took charge of the KRA last year.
“We will create an infrastructure and atmosphere to take advantage of horses for such activities. In addition, horse meat is good and we will work on ways of encouraging people to eat it in the future.”
Around 30,000 horses are raised here and Chang will strive to more than triple the figure to 100,000 by 2015 by increasing the number of ranches from 1,900 to 5,000.
In another plan to expand the business horizon of the KRA, Chang has come up with the idea of making better use of its cornerstone assets such as its vast facilities.
Its main racecourse is located on land bigger than 1 square kilometer in an area that people from both Seoul and the surrounding Gyeonggi Province can easily reach.
“At the Seoul track, we can make an eco-friendly leisure park where people can communicate with horses. Or, we may make an open-air botanical garden there,” said Chang who served as minister for food, agriculture, forestry and fisheries from 2008 through 2010.
“Over the long haul, we can mull over ideas of embracing the resort business by setting up accommodation around horse-riding facilities. We have a number of chances to exploit.”
The KRA organizes horse races with thoroughbreds, which are composed of both imported and indigenous breeds, at three courses in Seoul, Busan and on Jeju.
Its pari-mutuel betting system attracts more than 20 million visitors every year but as its conventional business model shows signs of becoming saturated, the racing authority has sought new cash cows.
