Inside Asian Gaming

INSIDE ASIAN GAMING | October 2008 30 Bright Ideas M any gaming executives might mistakenly believe that optimal utilisation on a gaming table is a simple function of getting as many people as possible to crowd around a single gaming table and wager as much as possible. At first glance, this might appear to be the most efficient utilisation of floor space and labour.This logic appeals even more in times when managers are being asked to trim their operating costs. This can occur when management is under short term profit pressure, and is looking wherever it can to enhance over-all performance. Themajorcostsinmostcasinooperations are gaming tax, labour and complimentary benefits to players. These often make up around 80% of direct operating costs in a casino’s table game operation and, as such, come into focus in times of economic downturn when greater efficiencies are being sought. As gaming tax is generally unavoidable as a percentage of win, and player complementaries—when properly administered—are a marketing cost that helps drive business,it is often direct gaming labour that receives the greatest scrutiny. It is the “most variable” of the variable costs. However, though it may seem counterintuitive, optimal table game utilisation is not necessarily a function of having every available position at every open gaming table occupied by customers. Indeed, that could quite possibly be a long way from the optimal outcome; the labour cost savings might be more than offset by foregone table game winnings. Targeting 100% gaming position utilization may be the best way to reduce labour costs, but it may also sacrifice the highest possible yield in profit from a given set of customers. This might be paralleled to a farmer maximizing the yield per tractor in harvesting his fields, but leaving much of the crop to rot because the few tractors in use could not get to some of the farmland. Determining optimal utilisation per table can be approached as a scientific question. This analysis attempts to do so by applying a relatively straight-forward mathematical equationwhichcanbeestimatedby carefully understanding and modelling certain important components of the mechanics of table game play. An appropriate table games analysis needs to take into account time and motion aspects of table gaming processes,including the elements that control the speed at which dealers conduct the game. In the game of Baccarat,as it is played in Macau or Las Vegas for example, the important elements are: • the time the dealer takes to deal the cards; • the time taken by the players of the Player hand and Dealer hand to expose their results; • the time taken by the dealer to take and pay individual wagers; and • the time allowed for players to make subsequent wagers. Issueslikefills,credits,cashbuy-ins,colour changes, supervisor acknowledgements and dealer changes all have some impact on the time and execution requirements at the table. However, these are usually considerably less significant and perhaps less sensitive to variations in the number of players at the game over any reasonable time frame. For our purposes, we are going to concentrate on the number of players as the key variable in seeking out optimal table allocations under varying player demand conditions. Using empirical observations to monitor, Bright Ideas: A Science and an Art Andrew MacDonald and William R. Eadington discuss optimal utilisation of table games