Lots of facilities have “leaky buckets,” spots where revenue is actually leaking away and needs plugs.



Several years ago, I wrote a column entitled Stalled Revenue Streams, those insidious operational snags, wrong-headed policies and crazy procedures that cost casinos money, lots of it. Today I bring you examples of stalled revenue streams’ evil twin sisters-the leaky buckets.

With stalled revenue streams, the revenue is dammed up and not flowing freely, but can be fixed if the stalled stream is unblocked. In leaky buckets, the revenue is actually leaking away and needs plugs, leak catchers or a whole new bucket to solve the problem.

A prime example of a leaky bucket is anything that can be exploited by “advantage players,” that breed of casino customer who (legally) takes profitable advantage of things that casinos do, turning their best intentions at driving business into leaking-bucket situations that sap profitability. Good examples would be:

• Rich coupons with few distribution controls;
• Overlapping promotions that together, for a brief time, cede the house’s advantage to the savvy player;
• Table game rules, bonuses and side bets that are mathematically exploitable;
• Excessive comps to the wrong players with the wrong amount of reinvestment attached to them; and
• A whole host of other mathematically misguided maneuvers where people smarter than casino executives take advantage. These are the most common leaky buckets.

Then there are other leaky buckets I have been noticing that may not be as apparent, or as damaging, but are harming casino revenues just the same. We may just not pay as much attention to them because they’ve been leaking so long, we may not even realize they are leaking. I call these the sneaky leaky buckets and that’s what I want to point out today.

As a table game player myself, I especially notice the sneaky leaky bucket of stupid table game procedures that slow-up games and allow profits to leak away in the form of lost game decisions. These occur when:

• Games are halted to “take the count;”
• Dealers are required to run a “counterfeit seeking” highlighter pen over all of the currency that players bring to the table in order to purchase chips;
• There is a numbingly long shuffling procedure at the blackjack game; and
• Table game play is halted to unnecessarily change the cards or dice.

Lost potential playing time is a sneaky leaky bucket outcome of all these delays in play.

Energy waste is another Sneaky Leaky Bucket. If a guest leaves a room and the lights don’t automatically shut off behind him or her, energy leaks and costs increase. If the hot water in the sink takes too long to warm up, precious water (literally) leaks away. If escalators are always in motion, even without guests moving up or down on them, power is leaking away, gone forever.

A pernicious and little appreciated sneaky leaky bucket is executive, close-in casino parking, where executives are taking up prime parking spots that could be used for guests. Take the extra steps that guests have to take between where they actually parked and where they could have parked without employees having snagged the best parking. Multiply those steps by the 365 days in a year and assign a time value to each step and you’ll get a sneaky leaky bucket listing of time spent “stepping” and not “spending.”

There are more. Unnecessary procedures for a player to redeem comps or free play are a players’ club sneaky leaky bucket. Buckets sneakily leak in retail stores when there is no effective price tag scanning technology. A sneaky leaky bucket in the gourmet steakhouse occurs when rooms are too dark (or menu print too small) and guests take extra time to decipher the menu. More reading + less consuming = sneaky leaky bucket.

But the most ubiquitous sneaky leaky bucket that can occur in any nook or cranny of any casino hotel department is any time there is a line. A queue. A people jam. A wait for service. It is here where potential guest spending is maddeningly and forever lost into space, when guests are forced to do nothing but … wait. And when they are waiting, they are not eating in your restaurants, not spending money in the shops, and particularly not putting their bills in a slot machine or sliding them across the felt table.

Leaks are everywhere in your operation. Whether they are “sneaky” or obvious, pipe-bursting leaks, plug them and you’ll have happier guests and a more profitable casino.