How to deal with Actual Loss in the casino industry.
By Andrew MacDonald
Gaming Manager, Casino Operations, Adelaide Casino, 1993
Rebate on Loss
What is the cost of rebating? |
How large a value? |
Unit Normal Linear Loss Integral |
Baccarat (Player/ Bank 50% Equivalent) |
Roulette (single number play on single zero Roulette) |
Most complimentary and junket programs utilise either theoretical win or turnover
upon which to calculate player complimentaries or rebates. In some cases, particularly
in the United States, junket programs rebate a percentage of loss to the junket
organiser or player.
Dealing with actual loss, however, is a difficult and often misunderstood
issue. A common premise is that "so and so is a born loser" or "the money's
in the bank" or "they do it in Vegas (or at Caesars/Hilton etc)" and therefore
giving a percentage of loss back to the player is alright.
The problem is that the percentage rebated is often plucked from the air and
has no mathematical basis. This then leads to the fact that often no one knows
what the theoretical or long term cost of such a policy is to the casino company.
In most business organisations understanding cost implications are a central
premise to operating effectively. Casino Operations should be no different particularly
in an area where the rebate is a totally hard cost.