|
#1
|
|||
|
|||
ALL B&M cardrooms face serious future financial problem
While poker continues to boom a hidden fiscal mess will eventually FORCE major decisions on every manager of a live poker room.
The problem is that while per table costs will always continue to rise (dealer costs, alcohol, insurance, cardroom share of allocated overhead; etc.) the amount of revenue per table is limited. Faced with the eventual overtaking of per table costs over revenues what are the cardrooms' options? They will be faced with either: A) increasing revenues (which is very limited as raising the rake too much more will turn away more and more players. Who will play small limit with an $8-$10 rake each hand?) or B) eliminating the cost of dealers and going to computer screens dealing at each table. With only those two options it appears that within 5-10 years we will see the end of live dealers dealing the game. The casinos will be forced to choose between overcoming the problem of their ever shrinking profitability per table (it matters not if they have 5 tables or 500 if each is losing money) or the end of live poker. This is a very serious issue which should be at least considered soon or someday in the not tOo distant future it may doom live poker. |
#2
|
|||
|
|||
Re: ALL B&M cardrooms face serious future financial problem
I don't understand how the casino's costs rise appreciably. Dealers are cheap, expendable labor, for the most part. Alcohol doesn't get more expensive, it's pretty fixed in cost.
-d |
#3
|
|||
|
|||
Re: ALL B&M cardrooms face serious future financial problem
You are describing inflation. As costs go up, so do prices. Luckily, since wages also go up, the real cost to play poker (indexed to inflation) is the same.
|
#4
|
|||
|
|||
Re: ALL B&M cardrooms face serious future financial problem
Sorry, but you are mistaken. Costs will continue to rise, while revenues in poker (per table) cannot. The cost in real dollars will eventually overcome table revenues. Not soon, but eventually it is inevitable. Other businesses simply increase their prices. Poker cannot raise their prices without losing customers as it would be too expensive to play. Who will play 3-6 holdem with a $10 rake?
Dealer salaries, despite being minimum wage are costly. Add their health insurance costs, business liability costs, the cost of the employer tax portions for FICA, FUTA, Workers' Comp for every employee, expenses of operations and maintenance, drinks, the very rare comp, and other casino wide cost allocations (security, porters, cashiers, etc and the total will eventually overtake revenues. I am sorry to report all this but I work in the financial field and know of what I speak. |
#5
|
|||
|
|||
Re: ALL B&M cardrooms face serious future financial problem
I think you are missing the point. When inflation happens, wages rise with in, and when that happens, people start playing higher stakes. In twenty years, 5/10 will be the new 3/6 for example.
|
#6
|
|||
|
|||
Re: ALL B&M cardrooms face serious future financial problem
[ QUOTE ]
I think you are missing the point. When inflation happens, wages rise with in, and when that happens, people start playing higher stakes. In twenty years, 5/10 will be the new 3/6 for example. [/ QUOTE ] It took only about 3-4 years for the 10-20 here to play like the 4-8s used to. However, 5-10 may not have as much action as 3-6 because there won't be as many chips in play during a hand. That can actually affect action of the game. b |
#7
|
|||
|
|||
Re: ALL B&M cardrooms face serious future financial problem
[ QUOTE ]
Sorry, but you are mistaken. Costs will continue to rise, while revenues in poker (per table) cannot. The cost in real dollars will eventually overcome table revenues. Not soon, but eventually it is inevitable. Other businesses simply increase their prices. Poker cannot raise their prices without losing customers as it would be too expensive to play. Who will play 3-6 holdem with a $10 rake? Dealer salaries, despite being minimum wage are costly. Add their health insurance costs, business liability costs, the cost of the employer tax portions for FICA, FUTA, Workers' Comp for every employee, expenses of operations and maintenance, drinks, the very rare comp, and other casino wide cost allocations (security, porters, cashiers, etc and the total will eventually overtake revenues. I am sorry to report all this but I work in the financial field and know of what I speak. [/ QUOTE ] Then you also realize that poker isn't the prime source of income for any casinos with pit games or slots. It's actualy secondary to the guys wife who is out playing slots for 5 hours. Or his buddies who are over at the craps table. But eventually I can see them raising the rake. Say if you add $1 to the rake of a 10-20 game or higher, it still beats playing 4-8 at a $3 rake. b |
#8
|
|||
|
|||
Re: ALL B&M cardrooms face serious future financial problem
So far it looks like 100% disagreement from my fellow posters here. I wish all those who disagree with me were correct but time will tell as raising the rake high enough to overcome this (with no end to increases in the future) will not be accepted by low limit players. This will lower revenues as fewer players will be willing to pay these amounts. I wish I were wrong about this.
|
#9
|
|||
|
|||
Re: ALL B&M cardrooms face serious future financial problem
[ QUOTE ]
So far it looks like 100% disagreement from my fellow posters here. I wish all those who disagree with me were correct but time will tell as raising the rake high enough to overcome this (with no end to increases in the future) will not be accepted by low limit players. This will lower revenues as fewer players will be willing to pay these amounts. I wish I were wrong about this. [/ QUOTE ] what makes you think these costs will rise at a rate significantly higher than the rate of inflation? |
#10
|
|||
|
|||
Re: ALL B&M cardrooms face serious future financial problem
[ QUOTE ]
So far it looks like 100% disagreement from my fellow posters here. I wish all those who disagree with me were correct but time will tell as raising the rake high enough to overcome this (with no end to increases in the future) will not be accepted by low limit players. This will lower revenues as fewer players will be willing to pay these amounts. I wish I were wrong about this. [/ QUOTE ] what about thirty years ago compared to today? I am sure that there is quite a bit of inflation that happened, yet poker survived. |
|
|