The idea to develop a casino is often driven by circumstances such as having sub-optimized space in the foyer of a hotel, the need to fill a distance in hotel occupancy or the option of a permission as part of a travel investment scheme. All too often the idea develops a life of a unique and the next steps are the creation of a casino design (that neatly fits the development team’s perception of what players want) and the start of construction, and then the search for casino management. The problem is that there are common misconceptions about casinos and players that lead developers into pitfalls time-and-time again! More about that later but let’s look at how the most successful operators go about things… They start with a preliminary understanding of the market, its determination, size, throw-away income, access, competition (for all entertainment),
market-specific needs and compatibility of the player profiles with other users of the hotel, resort or entertainment complex. This understanding then forms the cornerstone for the remainder of the feasibility study which estimates the number of potential visitors and their frequency of visit, the length of the average gaming session and the average position. Extrapolating further, projections about the capacity requirements in terms of equipment, floor area and operating times are designed. Finally, financial spreadsheets are crafted presenting a 토토사이트 supported and considered opinion on profit, capital expenditure and returns on investment. But more than just the numbers, the feasibility focuses thinking on how to maximize the opportunity, on flushing out potential fatal flaws and the amount will have to
compete effectively in the market. The feasibility doesn’t have to be a lengthy and expensive exercise conducted by a celebrated school. What’s sufficient in the early stages is to understand whether you have a rough diamond or a worthless glass processor. A professional casino consultant will be able to deliver a short feasibility for a reasonable price in as little as 10-working days, providing not really a decision point on the idea or opportunity at hand but also delivering a framework for screening future opportunities. Let’s look at some of the pitfalls…
The “license to print money” fable is a surprisingly popular prediction about casinos and one that may seem to prevent people from performing all the usual due groundwork and care that would go into say, a shop or restaurant opportunity screening exercise. Examples that come to mind follow. A large casino was created in a legislation where there are rules placed on video slot maximum blind levels. The revenue expectations of the slot machines were heavily relied upon to provide the casino viable.
When a revenue capacity model was run on the pai gow poker by an experienced manager several days before opening, it showed that it was a physical impossibility to generate the desired pai gow poker income with the number of machines installed… Naturally the casino failed to surpass expectations. A large casino developed in The uk by a US agent failed miserably because it did not understand the propensity for live gaming or the mobility of players in the market, whilst a British company failed amazingly in Las vegas because it didn’t understand the customer and made fatal design flaws.
The “James Bond” image is another popular false impression about players and casinos. The Pareto Principle applies heavily to casinos with approximately 80% (or more) of the revenue being produced by 20% (or less) of the visitors. That 20% does not constitute people who don formal dress for an occasional night out; it’s more typified by the frequent visitor who feels at home in the casino in comfortable, casual wear. The un-initiated 5-Star Hotel manager is invariably aghast at the presence in his or her entrance hall of the “non-James Bond-ness” should we say, of the casino players! “Where’s that casino manager, he’s obviously got this all wrong… inches And on goes the conflict-of-interests. The feasibility study will enable the corporation to spot these conflicting situations in time to create solutions such as providing a different casino entrance and differentiating F&B standards and prices in the hotel and casino.
I recall an incident where several grouped management went to great extent to propose the development of a large caravan park in the grounds of a destination casino resort, some 2 hours drive from a major city. The resort had the only casino within 4 hours driving-time of the city. The management proudly began to present their highly rubbed and detailed decide to greatly increase footfall to the resort when much to their dismay we were holding severely penalized by the CEO. They had failed to recognize that the hundreds of caravans on the road would delay the 20% of visitor that produce 80% of the revenue and the significance of such shortening of the gaming session!