Managing the out of control costs of table game operations in today’s gaming industry

At this year’s Global Gaming Expo, I gave a couple of seminars on my two favorite subjects-training dealers to be more entertaining and training supervisor for the new role that is asked of them in this technology age of table games. I saw many old friends and clients, bringing back many memories. The best thing about G2E was that I could drive there and sleep in my own bed!

The worst thing at G2E? For me anyway, it was wading through the ridiculous amount of new table games, side bets and other lease fee products on the show floor. I saw more products all designed with the same concept in mind for table games…how to drive up the cost of doing business in a casino department that is struggling-at best-in improving profitability.

Overdoing it?

I saw so many new games on the floor it was comical. While some had merit, most belong in a board game for play at your summer cabin, not on the casino floor. Remember the movie “Vegas Vacation?” The scene where Chevy Chase was playing ridiculous games in a casino like “Rock, Paper Scissors” or “Guess How Many Fingers I have behind my Back?” Well we are close to that now.

For table game managers, the cost of doing business is of the utmost concern. The key to success with table games is keeping operational costs in line. Some costs are indeed out of control, like payroll issues spiraling upward.

With some operational costs though, usage and implementation are being adapted as a production enhancer, and the costs of the technology and inherent fees that come with this technology are placing more of an economic hardship on our operating costs. Where is the point where the costs of doing business, especially with buying or leasing technology and new products, are overcoming its net worth? In some cases, we have reached that point.

Technology and lease fees

I don’t want to sound anti-tech-nology, as I like it and use it all the time. Frankly speaking though, most technology does not do anything to grow your table games area and play. Table games that can measure handle and can track players for marketing information are a great thing. Shuffle machines that can crank out more hands per hour are a great thing. But for the majority of smaller, regional casinos (read: most Indian casinos), the usage of this equipment is more costly than its worth.

For a department that is floundering in most casinos, I cannot understand how casino managers continue to pile up operating costs through costly equipment and new games that are, well…simply becoming too costly! If I were to become a casino manager again, I would ask this question of any piece of equipment or new game: “Will its cost be offset by an increase in revenue?”

I don’t mean an increase in productivity or better game protection, but an increase in player participation. If the answer is no, save the money and try to show a profit without the extra costs.

I have no knock against shuffle machines. They serve a purpose when needed, (high volume of play, big betting limits, etc.). Shuffle machines will generate more hands per hour, this is fact. But if your casino has a low limit and lower average bet, if your games are not going full bore most of the time, should you be adding to the unprofitability of your department by paying a monthly fee for a machine to shuffle your cards? In some instances, it may be more cost effective to have the dealer shuffle the cards and save the money.

I know what some of you are saying here. How about shuffle trackers and false shuffles? Here’s a novel idea, lets have the supervisor watch the shuffle…just like they are supposed to without the machine.

How about all the leased games we are paying for and their escalating costs? Aren’t we paying too much for most of these products, which are not adding more players but simply moving an existing player off of a product and onto another? I think we are. New games, to justify their spiraling costs ($1,300 and more a month for a leased poker style game!), have to bring in new players. If you are paying for these products without seeing growth in your department’s drop, you may be wiser to save the money here.

We in table games are at a crucial point in our existence as a part of the gaming mix. To ensure growth or even just survival of our departments we must get a grip on managing our departments better. A professional look at staff management is needed desperately here. Also a managed look at the costs we are paying for leased items has to be addressed. Management of our departments has to be handled both financially- and personnel-wise and then a sustained plan on growing play has to be implemented.