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☛ The business of running a “business” 9-3-18

THE BUSINESS OF RUNNING A “BUSINESS””

 

By Richard E. “Rick” Dennis
September 2, 2018

 

On July 18, 2014, I authored and released an article, on allaboutcutting.net, entitled; “WHERE’S THE HORSE INDUSTRY HEADED?”  The article covers a myriad of topics that were plaguing the American horse industry back then, and in some degrees, with exception, are still plaguing the equine industry today. This article had the most comments ever, with 99 – all agreeing.

 

However, we haven’t seen much progress in two of the focal points of the article, directly contributing to a loss of membership, investors, and participation in the industry: bad horse trainers and the mismanagement of a 501(C)3 Nonprofits. It’s been established that equine nonprofits are very reluctant to intervene in helping to eradicate immoral, unethical, abusive and downright bad horse trainers from the industry, except for animal abuse.

☛ Where is the horse industry headed? – 7-18-14

Well ladies and gentleman, what about member abuse? During my tenure in the horse industry, I’ve witnessed an increase in civil litigation involving horse trainers and their client or clients battling it out in the court system over a fraud dispute that usually emanates from some horse trainer’s bad, unethical, and in some cases just outright – bad and illegal business practices. In fact, there’s a large populous of unsuspecting newcomers to the horse industry who are victims of unscrupulous horse trainers, on an annual basis. The sad commentary to this ever-increasing problem is, that every time these victims turn to the 501(C)3 nonprofit for assistance or relief, the victim hears the same old pathetic excuse: We Don’t Have a Rule For That ! ”

 

Perhaps it’s time for the “Powers-That-Be” running these struggling multi-million dollar 501(C)3 non-profits, to get together and design and adopt specific rules to govern its horse trainers, as well as, in some cases, their illegal and unscrupulous bad business practices. After all, investors and members are the backbone of any 501(C)3 nonprofit horse organization and not the horse trainers, as they often recite. I know these facts to be self-evident because I’ve been involved in a myriad of unethical business practices in the industry, committed by horse trainers,  from a “Risk Analyst’s” perspective.

 

When appropriate and where probable cause exists, I have on more than one occasion recommended a further review by law enforcement to ascertain whether or not prosecution for specific law violations are warranted and as a result of my Risk Analyst determinations. However, a 501(C)3 nonprofit doesn’t have any problems asking members for free time and donations to support these “over-priced” individuals occupying management positions within the organization.  For doing what?  protecting bad horse trainers and their unethical conduct and actions, which usually results in running good people out of the business!

In my opinion, when a horse organization doesn’t establish rules and regulations to protect innocent and unsuspecting members, investors and newcomers to the industry, then they are essentially condoning these types of unethical business practices. They are ostensibly going right along with the bad actors!

 

Case-in-point, when a horse trainer is sued in court by two separate horse organization member Plaintiffs and accused of fraud involving hundreds of thousands of dollars in damages, my question is, “Why is this individual being sued still a member of any horse organization?” Or better yet, “Why isn’t this individual in jail and being prosecuted?”

 

For the record, I’ve been in business, in the private sector, since January 28, 1984.  Since inception, my company has been registered in the state of organization, both my Federal and State taxes have all been filed and paid on a recurring annual basis – when necessary, all business licenses are up-to-date, issued 1099s are accounted for and my company has an A+ business rating with the Better Business Bureau. If I have to comply, why shouldn’t everyone else calling themselves a business owner?  Especially, the ones operating with a 501(C)3 nonprofit organization and using a business moniker such as “Incorporated,” Limited Liability Company,” “Sole-Owned-Proprietorship,” a “Doing Business As (dba)” or “an assumed name?”

 

In business, we call this being fiscally responsible. In addition to being fiscally responsible, I also have another prudent business practice: “I offer a “100 percent, full-satisfaction money-back guarantee” on all of my business products and services, including “horse training.”  It’s just “good business practice.” However, there’s one difference that separates my company’s clientele from the horse industry. It’s referred to as “over-sight.” Unlike 501(C)3 nonprofits in the horse industry, that don’t exercise any or very little “over-sight” of horse trainers except horse abuse or issuing a bad check, my clients demand “over-sight” and I either adhere to compliance protocol or I find another place to work.

 

Obviously, that’s the difference between governmental agencies like the Department of Defense and the petrochemical industry versus the unregulated horse industry. Another major difference between my business criteria and the horse industry is by example: background checks, criminal record checks and drug and alcohol tests. Alone, these criteria strictly separate the good from the bad so-to-speak. The latter is also the criteria, which is lacking in the horse industry and allows individuals with criminal records to infiltrate and seemingly blend in with the overall good and excellent horse trainers in the industry, who bad horse trainers and their unscrupulous and often times “illegal” business dealings, give a bad stigma also.

 

Therefore, until the “powers-that-be” take the “reins of responsibility” and move to enact membership rules to “counteract” unscrupulous horse trainers and their diabolical practices, I’m afraid the horse industry is going to continue to experience a significant decline in membership, participation, investors and sponsors.

 

In the mean time, there are a lot of changes that 501(C)3 nonprofits can enact to enhance the viability of an organization, i.e., 1) term limits for how long and how many times an individual can occupy a seat on an organizations executive committee, 2) the removal of horse trainers from the Executive Committee and decision-making status, 3) a financial restructuring to reduce employees and overhead expenses (i.e., expenses and salaries for executives and employees, to come in-line with available cash-flow), 4) and enacting rules to address fraud and unscrupulous acts committed by its members.  After all, the horse industry is suppose to be fun and not a legal exercise in a courtroom because of fraud and illegal business practices.

 

As a professional reined cow horse trainer, my job is to train horses, students and prepare them for the show ring. I’m a big believer that businesses should be run by successful business people with expansive business experience and logic – not by horse trainers whose primary mission is to protect their food source “so-to-speak,” as well as other horse trainers when necessary, as we’ve all seen in the past. A horse trainer’s job is to train horses, bring new customers into the industry and represent themselves, their clients and the association in an ethical business manner and atmosphere. As we see today, well-run organizations, like the National Reined Cow Horse Association are flourishing, while others that are not practicing prudent and fiscally responsible business practices, are on a rapid decline in members, sponsors and investors.

 

NON-PROFIT INSTABILITY

 During my tenure in the horse industry I’ve witnessed a lot of regime changes over the years, but one in particular stands out: the National Cutting Horse Association.  When I first came into the industry, Jeff Hooper was the Executive Director, next came Allen Stein then Jim Bret Campbell. The next interim Executive Director was Ernie Beutenmiller, then Chuck Smith and now the interim Executive Director is Louis Wray. It’s my opinion that when these many executive employee changes transpire in such a short period of time, it’s usually a result of inexperience within the executive staff.

 

However whatever the cause, instability with upper management within an organization exhibits nothing else but unsound business experience within the rank and file of upper management, a fight for power dominance within the organization and subsequently translates in the long run into a reduction in membership and loss of sponsor revenue. The tragedy in this “helter-skelter” ring around the rosy of Executive Director roles is that it’s a very expensive proposition for the nonprofit, especially when they have to pay a former Executive Director the full amount of his employment contract financial agreement – even after the individual has left employment with the organization before his full tenure is up. This is not a very good, sound or prudent business practice!

 

Over-all, now’s the time for 501(C)3 nonprofits to perform a little “soul-searching” and determine the best course of action for them to viably sustain the organization in the future. Remember, horse trainers are not the backbone of an organization.  The real money that makes the “world-go-round” comes from investors, METF funds, members and sponsors. Without these entities, nonprofits wouldn’t exist and neither would horse trainers. As my contribution to the horse industry I wrote a book many years ago entitled: THE AMERICAN HORSE INDUSTRY, Avoiding The Pitfalls which was written to provide members in the horse industry with common-sense business practices to avoid the pitfalls inherent in the industry and some of which are covered in this article. If an individual really wants to know how financially responsible your 501(C)3 nonprofit is doing, you can go to Guidestar.org, enter your nonprofit’s name and research a specific year’s IRS 990 tax filing to see exactly what’s going on financially with them, including the amount of salaries being paid and who they are paid to.

 

“Until Next Time, Keep ‘Em Between The Bridle!”

 

WIND RIVER COMPANY LLC
Richard E. “Rick” Dennis
Managing Member
Freelance Writer and Author
Office/Mobile: (985) 630-3500
Email: richardedennis51@gmail.com
Web Site: http://www.richardedennis.net

 

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11 Comments

  1. Rick, you letter was great, but the mcha isn`t going to listen, every since Mr.Zack retired the trainers have taken over, . I bet you can`t show me 60 trainers who can balance their own check book , but they are on the ec. It should be changed so business men are on the ec and you sure will see a difference, Take the king ranch the family couldn`t get along so to benefit all they turned it over to corporate management nd look today they are in the black. if the ncha would put ccrporate nagement in place you will see a profit can`t lose anything right

  2. Rick,
    Your letter was great, but the NCHA isn`t going to listen. Ever since Mr. Zack retired, the trainers have taken over. I bet you can`t show me 60 trainers who can balance their own check book, but they are on the EC. It should be changed so business men are on the EC and you sure will see a difference. Take the King Ranch – the family couldn`t get along so to benefit all, they turned it over to corporate management and look – today they are in the black. If the NCHA would put corporate management in place, you will see a profit. Can`t lose anything right?
    Ron

  3. I’ve always enjoyed reading your articles. I thank you for sharing your unbiased experience and opinions. I find your commentaries vastly enlightening, filled with common sense measures, and frankly blunt. It’s your bluntness and frank honesty which I find the most rewarding. While most magazines shy away from issues that impacts the horse industry, you and allaboutcutting.com meet these challenges head on with blunt truth, Frank honesty, and reinforce your findings with documented facts. As distasteful as a topic may be, your articulate writings brings secrecy and collusion to the forefront of discussion and enlightenment. Therefore, please keep writing and exposing the deep rooted flaws and corruption in our beloved horse industry and I’ll keep reading and enjoying your articles.

    Kim

  4. Great article. I think it’s a befitting time for the NCHA and others to learn a lesson in business. It might save some organizations and it’s members from overbearing and unknowing horse trainers. It’s obvious that businesses should be run only by business minded folks who are experienced in managing and running a business. Perhaps, before it’s to late, the secret societies will wake up.

    Tim.

  5. Mr. Dennis, I thoroughly enjoyed your latest article on running a business using common sense business practices. As a member of the NCHA for many years, I’ve witnessed an association becoming more divided and destined for a perilous outcome. I too agree that horse trainers have no business running a horse association. Especially, when their bias determines the outcome of a disciplinary action, as we’ve seen in the Dufurrena matter. An outcome which should have ended in a life suspension.

    Sherry

  6. I think what happened to the Vogels is just a disgrace. A disgrace on the part of the NCHA and a disgrace on the part of the Dufurrena’s.

    Karen

  7. Great article! As a member of the horse community, I believe it’s far time the NCHA under goes a complete over haul. Putting Janie Vogel on 3 years probation and suspending Dufurrena for ONLY 150 days while not suspending Shona Dufurrena at all for cooking the books is shocking to say the least. I know Sharon Baker is Shona Dufurrena’s mother. Why all the secrecy about this family relationship?

    Sarah

  8. I just read your article on all About Cutting. I personally find what Ed Dufurrena and his entire family did to NCHA is absolutely disgusting. I’m also disgusted that NCHA did not ban them permanently or certainly come down harder on them than they did. Shona Dufurrena should likewise be penalized. She is just as much at fault as Ed for the scams they pulled – and she handed all the paperwork to include registrations and show entries. Why aren’t they in jail? I’ve made inquiries with NCHA officials and yes, they tell me ‘We don’t have anything in the rulebook that allows that’ but if you read the bylaws, they have the authority. I’ve had two attorneys tell me they have to specifically have a consequence for violations if permanently banning someone. I’ve been doing some research and also learned that NCHA in particular has a history of poor management and lots of secrets. Allen Steen proved that with his lawsuit. I’m currently researching past member violations and penalties assessed. Can you recommend resources for this research?
    Lois

  9. I really enjoyed your article. I remember a few years ago we saw restructuring in all of the nonprofits except the NCHA. It seems to be working out very well for the NRCHA, the APHA and the AQHA. I just don’t think there’s as much money running around the industry as there use to be. I agree that part of that problem is bad trainers.
    Kyle

  10. Glory Ann: What a surprise! Just read Sarah’s comment and shocking revelation about Sharon Baker being Shona Dufurrena’s MOTHER! As I recall, and via sworn affidavit, Baker’s powerful and fawning portrayal of the Dufurrenas was seen by NCHA Appeals Board and was most likely presented in order to bolster their questionable moral standing.

    Baker, claiming to be a longtime happy client of the Dufurrenas was somewhat of a mystery in that nobody seemed to know her. She was just seen as that shadowy silhouette from Riverside CA. Wonder if NCHA brass ever talked to Sharon Baker, and what was their impression?

    This woman, Sharon Baker, showed the true affection and adulation that only a mother could have for her child. Awaiting the next revelation,…….Herb

  11. I just wanted to write and tell you how much I appreciate your article. As a former NCHA JUDGE and Member from Arkansas I totally agree with everything your article states. Thanks

    Conway.

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