We talk a lot about what machines, games, and denominations to purchase for a gaming floor, but too little attention is paid to the machines that should be retired from the floor.
Most gaming managers approach it simplistically, concentrating on the bottom 5% or 10% of machines based on net win. But more thought should be devoted to which machines to cut from the gaming floor.
Here are six guidelines that managers should consider when deciding what to do with sluggish performers:
Location
A machine located in a poor part of the floor might be prematurely cut not because the game is unpopular, but because the location is disadvantaged. A machine that performs at floor average but is located in a great position might be less valuable to you than a machine performing at below floor average but located in a disadvantaged location.
Occupancy
It’s not all about Net Machine Win. Some machines play a supporting role to the rest of the floor and provide strong occupancy levels in peak times. A machine might return low levels of net win on a monthly basis but in peak times, attract high occupancy levels and low average bet levels.
In many ways these types of machines are adding to the entertainment value of the floor, but may not be returning strong revenues.
Who plays the machine?
It’s happened more than you think; a machine is retired and as it’s being wheeled out your best player asks why you’re getting rid of one of their favourite machines. Before you send a machine packing, make sure you do your homework and get a good communication plan in place.
Is it still supported?
Machines and cabinets that are no longer supported by the manufacturer is key to your retirement strategy. It’s worth checking what part of your fleet is still active before you retire a machine that is still supported with game changes and other options.
Written down value of the machine
If two machines are equally deserving of being cut from the floor, your accountant would advise you to retire the one that creates the lower financial write down on the P&L. So consider the book value and the trade in value of each alternative.
Trending
Some machines fall faster than others when players decide to move on. Consider Machine A and Machine B in the below chart.
At a particular time, Machine A might be outperforming Machine B, however Machine A might be declining faster than Machine B. Given the trend, it might be better to retire Machine A before B, based on its faster downward trend.
Need a fresh look at your gaming floor? Call to speak with the team at DWS on 07 3878 9355 or email us at info@dws.net.au.
