NCJ Number
126306
Date Published
1989
Length
22 pages
Annotation
The estimates made in 1977 by Killingsworth and Associates regarding the average attendance, average handle, and per capita handle of the newly opened Birmingham (Alabama) Turf Club were much too optimistic. This analysis focuses on the forecasts, comparing them to the forecasts made by Magnolia Downs and Birmingham Downs, two other corporations bidding to run the same track and wagering operations.
Abstract
Although Killingworth's estimates were, at the time, thought to be superior, all three packages combined good insights, tedious mathematical calculations, illogical reasoning, and some poor statistical practices. All three corporations used Louisiana Downs as a similar market to Birmingham when calculating their daily attendance estimates, but Killingsworth's analysis exhibited several analytical problems, with the result that actual attendance was just over 60 percent of the estimate. Although conceding that per capita handle is difficult to estimate, the authors point out several flaws in Killingworth's reasoning; per capita wagering was under 54 percent of the estimate. Finally, the Birmingham Turf Club committed at least five major management errors that resulted in a revenue one-third of that estimated. The errors lay in capitalization, marketing, production, advertising and promotion, and press relations. 9 tables and 3 references