Optimize Room Occupancy to Maximize Casino Revenues
Managing a casino resort today is much more complicated than in the past. Before, the primary emphasis was always on game security and preventing internal theft. Today, the emphasis is more on maximizing bottom line profitability. Many casino operators have had to review their operating philosophies in many different areas in order to achieve this new objective. With the help of various technological improvements in surveillance equipment, casinos have been able to reduce man power and payroll for the area of game security. This reduction in payroll has obviously helped improve bottom line profits.
Along these same lines, an often overlooked area for helping to tweak bottom line profitability is an area that I refer to as optimization of room occupancy levels as well as the occupants themselves. Here at xxxxxx Casino we find that it is important for us to balance the ratio of comp to cash room revenue. Many people will argue that is better to fill the hotel with all casino customers and comp all of their room nights. However, the problem is that many of these customers play in the casino using casino credit. That means that their markers may not come due for 45 to 90 days or longer depending upon the gaming jurisdiction and regulations. In the meantime, the casino still has to pay out huge cash disbursements each week to cover payroll, taxes, utilities, vendors, etc. I don’t think your employees or your vendors would want to accept a partial cash payment and a partial comp dollar certificate or I.O.U. note if the casino did not have sufficient cash flow that week to cover all obligations. Therefore, managing cash to comp ratios is an important function today in any large casino hotel operation. […]