chook
chook
Joined: Jul 5, 2010
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August 27th, 2010 at 5:40:23 PM permalink
I've been trying to work out how Casinos could possibly make a profit, on European roulette, where the margin is less than 3%.
Their overheads (gaming staff, security, cleaning, maintenance, hospitality etc) must be astronomical.
Their power costs, alone, would be enough to bail California out.
You can't trust a dog to mind your food.
mkl654321
mkl654321
Joined: Aug 8, 2010
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August 27th, 2010 at 10:44:22 PM permalink
Quote: NicksGamingStuff

Hey mkl are there any more good VP machines in N California? Want to go hit up them sometime?



No decent VP any more, anywhere in NoCal. There are a few scattered $1 JOB, and I think Trash Creek has a very few decent machines (about four), not that anyone would want to make the long and tedious drive to that isolated shithole.
The fact that a believer is happier than a skeptic is no more to the point than the fact that a drunken man is happier than a sober one. The happiness of credulity is a cheap and dangerous quality.---George Bernard Shaw
cclub79
cclub79
Joined: Dec 16, 2009
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August 28th, 2010 at 6:29:38 AM permalink
Quote: chook

I've been trying to work out how Casinos could possibly make a profit, on European roulette, where the margin is less than 3%.
Their overheads (gaming staff, security, cleaning, maintenance, hospitality etc) must be astronomical.
Their power costs, alone, would be enough to bail California out.



But all of the overhead you mentioned is shared with games that have much higher edges. They figure they can afford a couple of (perhaps) "loss leaders". Sure, if your casino was NOTHING but European Roulette, you might have a problem. But it's not. They also hope that some of the winnings will be spent in their restaurants, shops, hotel, etc.
Doc
Doc
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August 28th, 2010 at 10:05:50 AM permalink
I am reminded of the old sales quip: We lose a little bit on each transaction, but we make up for it with volume.
SanchoPanza
SanchoPanza
Joined: May 10, 2010
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August 28th, 2010 at 11:37:51 AM permalink
Quote: chook

I've been trying to work out how Casinos could possibly make a profit, on European roulette, where the margin is less than 3%.
Their overheads (gaming staff, security, cleaning, maintenance, hospitality etc) must be astronomical.
Their power costs, alone, would be enough to bail California out.



They can make out on true odds. That is to say that at craps, for instance, casinos do not lose big money on free odds, or they would not offer it. In addition to the built-in mathematical house advantage in all games, no matter how minuscule, the casinos have powerful advantages in bankroll and time--always being open. And then there is that powerful motivating force for more than 95 percent of the population -- blind greed (for "free money").
chook
chook
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August 28th, 2010 at 3:32:09 PM permalink
You're right.
I forgot to factor in greed.
There is no accounting for that.
You can't trust a dog to mind your food.
mkl654321
mkl654321
Joined: Aug 8, 2010
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August 28th, 2010 at 3:57:03 PM permalink
Quote: chook

I've been trying to work out how Casinos could possibly make a profit, on European roulette, where the margin is less than 3%.
Their overheads (gaming staff, security, cleaning, maintenance, hospitality etc) must be astronomical.
Their power costs, alone, would be enough to bail California out.



The reason is, you are misinterpreting "margin". They aren't buying widgets, bagels, cars, etc. at $1 and selling them for $1.03. THAT would generate overhead, which that 3% margin would indeed be insufficient to pay. But when a casino accepts a $1 bet on roulette, it immediately hands back 97 cents to the customer, mathematically. No actual tangible good is exchanged. Therefore, the only overhead is to pay the minimum-wage dealer and to keep the lights over the table lit. Bets don't have to be physically stored, and don't have to be paid for (to be resold in advance); the casino simply waits until someone walks up and wants to sell his $1 bill for $0.97.

It's a great scam, and a terrific business to be in, and anyone who manages to run a casino into the ground is either a moron or a crook.
The fact that a believer is happier than a skeptic is no more to the point than the fact that a drunken man is happier than a sober one. The happiness of credulity is a cheap and dangerous quality.---George Bernard Shaw
chook
chook
Joined: Jul 5, 2010
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August 28th, 2010 at 4:42:02 PM permalink
You're right.
They really are on a good thing if they can selectively isolate their costs the way you are suggesting.
You can't trust a dog to mind your food.
DorothyGale
DorothyGale
Joined: Nov 23, 2009
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August 28th, 2010 at 5:02:07 PM permalink
Quote: mkl654321

It's a great scam.


A scam implies deception. Most I've spoken with (those who are not advantage players ...) who go to a casino EXPECT to lose money, viewing the loss as the cost of entertainment.

A scam implies deception. No deception here.

Quote:

anyone who manages to run a casino into the ground is either a moron or a crook.


Or happened to be in management at a casino since 2007 at the start of the great recession. There are many costs associated with running a casino, and if players aren't walking through the door, it is very tough.

And remember, casinos employ vast numbers of entry-level workers, people who could not otherwise find a job.

I like casinos. Especially ones with rainbows in them.

--Dorothy
"Who would have thought a good little girl like you could destroy my beautiful wickedness!"

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