Revenue
Revenue Model
Current Revenues
Figure 1, below (centre and right of centre) describes Trident’s traditional (current) revenue model. It can be seen that revenue sources span the entire Sports Timing value chain. This model is globally scalable; More than 80% of sales are exports. Sales are generated directly (captured by our online systems) or via Distributors, Resellers and Partners in the US, NZ, UK, AUS, Europe, Japan and China. The distribution network mainly targets the sports of Road Running, Marathons, Cross Country, Triathlon, Cycling, Motor-sport and Scholastic fitness measurement. There are many other niches.
The end-customer is Sports Events. The three products that the Sports Event Manager purchases, are;
- Timing Tags (single-use or re-usable)
- Timing Services
- Participant Registration, Payment and Results Publication
Trident’s revenue comes from four streams;
- The sale of timing tags, sold either to the Event or to the Timing Service Provider. Single-use tags offer the greatest opportunity
- The sale of timing equipment to the Timing Service Provider (an asset purchase)
- Rental equipment that smooths peaks in the Timing Service Providers’ demand
- Participant registrations, collected as a percentage (~4%) of the entry fees. The value of Entry fees is $millions, but it’s a very slim margin, after the banks take their cut – however the cost of sale is very low and once a customer is on-board they do not tend to leave
Trident’s business model reflects the importance of long-term profitability through recurring revenues. Now, instead of just ‘selling the cow’ (systems) we also ‘harvest the milk’.
Trident products have significant competitive advantage in ‘Wet Events’, like swimming, triathlon, and cross country running (usually wet and muddy). Our competitors’ products are unreliable in this environment. We can command a price-premium for our products in these sort of events.
Other revenue sources are:
- OEM components for Timing Systems to the Chinese market. This is lower value but high volume and is necessary because of the Chinese regulations for ‘local content’.
- Systems targeted at School PT (fitness testing) in the USA. In this model the timing system is sold at very low margins. Timing tags are purchased annually, by every student, at high margins (about $4 profit in every tag). Each school buys around 400-500 tags per year.
- Fixed installations for Community, via Govt., used measure and positively reinforce activity and exercise in the fight against sedentary behaviour. The revenue model is similar to the PT model, but with higher equipment margins and much higher tag margins (~$8 each).
Future Revenue
Future Revenues
To the left of centre on the Revenue Model (Fig 1), a new and emerging business opportunity is highlighted i.e. for Trident (or its agents) to provide product and services directly to the Event Manager, cutting out the middle man – the Timing Services Provider. This model has the potential to vastly increase single-use tag sales and provide an enormous brand exposure opportunity for Trident, Sponsors or Partners. The value of this opportunity is not yet quantified but it is likely to be significant.
This model requires, either;
- Supply of rental equipment, which for many reasons, is difficult to scale
Or
- Supply of a single-use timing system
In addition, tags must be provided, the data must be captured, and the event ‘scored’ to produce and publish results. All of these products and services are revenue generating. The data capture, ‘scoring’ and results publication requires data communications infrastructure, cloud-based services, applications and web-based platforms.
Figure 1 – Trident Revenue Model
