The method by which SPs are set for each runner varies in different countries but is generally by consensus of an appointed panel on the basis of their observations of the fluctuation in prices at the racetrack.
[1] Only bookmakers that generate prices independently are considered, and those within the same ownership group are treated as a single sample.
Typically, on the day of the race, UK bookmakers offer a choice between placing a bet at SP, or taking a fixed price.
This is aimed at removing hesitancy among punters prompted by fears of taking what might prove to be a poor (that is, low) price before the race.
[3] In the United Kingdom, the stake on an SP bet is returned if the entry is withdrawn before the race starts.