Can you Afford to Skip the Casino Feasibility Study?

The idea to develop a casino is often토토사이트  driven by circumstances such as having sub-optimized space in the foyer of a hotel, the need to fill a hole in hotel occupancy or the accessibility to a licence as part of a vacation investment scheme. All too often the idea develops a life of its 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, accompanied by the search for casino management. The problem is that there are common misconceptions about casinos and bettors 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 knowledge of the market, its readiness, 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 foundation 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 pole. Extrapolating further, projections about the capacity requirements in terms of equipment, floor area and operating times are developed. Finally, financial spreadsheets are crafted to provide a supported and considered opinion on profit, capital expenditure and returns on investment. But more than just the numbers, the feasibility focuses thinking on what to improve the opportunity, on flushing out potential fatal flaws and on the will be asked to

compete effectively in the market. The feasibility doesn’t need to be a lengthy and expensive exercise conducted by a celebrated educational. What’s sufficient in the first stages is to understand whether you have a rough diamond or a worthless glass computer chip. A professional casino consultant will be able to deliver a preliminary feasibility for a reasonable price in as little as 10-working days, providing not just 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” fantasy is a surprisingly popular premiss about casinos and one that generally seems to prevent people from doing all the usual required research and care that would go into say, a shop or restaurant opportunity screening exercise. Examples that one thinks of follow. A large casino was made in a legal system where there are constraints placed on slot machine game maximum levels. The revenue expectations of the slot machines were heavily counted upon to establish the casino viable.

When a revenue capacity model was run on the video poker machines by an experienced manager several days before opening, it showed that it was a physical unfeasibility to generate the mandatory video poker machines income with the number of machines installed… Naturally the casino failed to meet expectations. A large casino developed in The british isles by a US owner failed miserably because it did not understand the predisposition for live gaming or the mobility of players in the market, whilst a British company failed stunningly in Nevada because it didn’t understand the customer and made fatal design flaws.

The “James Bond” image is another popular disbelief 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 put on 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 vestibule of the “non-James Bond-ness” will we say, of the casino players! “Where’s that casino manager, he’s obviously got this all wrong… inch And on goes the conflict-of-interests. The feasibility study will enable the corporation to name these conflicting situations in time to create solutions such as providing another casino entrance and differentiating F&B standards and prices in the hotel and casino.

I recall an incident where a small grouping of professionals went to great program plans 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 professionals proudly begun to present their highly finished and detailed want to greatly increase footfall to the resort when much to their dismay these were roughly punished by the CEO. They had failed to observe 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!

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