1 more table (marginal revenue)

Hello.

I am trying to find a way to calculate the value of a table game. If you know the theoretical hold all you really have is the value of 1 version of that table game if it where the only table on the floor.

How do we factor in that the 10th $10 blackjack table is not necessarily worth as much as the 1st. In particular how to we compare different table games (without having access to the raw data from a casino) so that we can figure out if it would be better to add one more blackjack table (making it 10 blackjack tables) or a another casino war table (making it 3 casino war table on the floor)?

Hope this is clear and thank you in advance to any helpers.

Quote: joanmiller

Hello.

I am trying to find a way to calculate the value of a table game. If you know the theoretical hold all you really have is the value of 1 version of that table game if it where the only table on the floor.

How do we factor in that the 10th $10 blackjack table is not necessarily worth as much as the 1st. In particular how to we compare different table games (without having access to the raw data from a casino) so that we can figure out if it would be better to add one more blackjack table (making it 10 blackjack tables) or a another casino war table (making it 3 casino war table on the floor)?

Hope this is clear and thank you in advance to any helpers.

Hi, joanmiller, and welcome to the forum.

I'm not quite understanding your point of view. If you're in the position of making a decision on game placement, how do you not have access to the raw data from the casino?

It's my understanding that a casino tracks the average hold and win for all tables, and subsets of each type of table. They then decide whether the win expected from a new table will exceed (and thus raise) their average income, either theoretical, or with a field test of it. If it will, they place the table. If not, they don't.

If you don't have access to that information, I'm not sure how you can accurately make that decision. But, you could do some things to make an educated guess.

You can look at the demand from people waiting to play when each type of table is full. Keep a waiting list for a few weeks. Or just observe whether people are standing there, chips in hand, without a place to play. If there isn't a demand beyond what you offer now, why use up your valuable floor space.

Included in your demand question should be whether there are times you have to limit how many hands people play, in order to accommodate everyone who wants to play. If you're asking people to give up a hand they want to play, you're making a more-than-minimum bettor unhappy.

You can also look at how often/duration of time you're not allowing every player a seat. If you can't seat all your bj players every night for an hour or two, but the war game only fills up once a week, you'll make more from the bj table. Or vice versa.

You can look at the size of the bets people are placing. If there's a lot of more than minimum betting going on at either type of table, that's probably the one you want to expand, to make sure you can accommodate those players.

You also have to take into account that some games come with royalties to someone. War is a proprietary game. Blackjack is not, but most sidebets for it are. So there's table rent to add into the costs.

You also have to consider, to some extent, dealer training and error rate expected. If it's an easy game to deal, like both of those are, training costs are low, and any of your dealers should be able to man the table. I would guess the error rate on bj is a bit higher than war. If it's a more complicated game, this component might be a higher factor.

Just a few suggestions. We do have several casino people here who might be of more specific help.

That is a good question. I think if I had over 50% utilization at all of the first nine tables I would open a tenth table.

The company that has done all this research and has excellent products is Tangam Gaming. I recommend you explore their website ...

http://tangamgaming.com/

Hopefully this plug is okay as it has nothing to do with me.

I also think that certain games have value beyond just their hold per table. Pai Gow Tiles will bring in a player who will also play baccarat, sic bo, blackjack, and his wife who will play slots, and his mistress who will play Pai Gow Cards and hit up the shoe store for $1500 LaBoutins. Without that 1 Tiles table, the whole crew is gone. The 10th BJ table just brings in another single low roller.

Quote: SOOPOO

Tiles will bring in a player

Quote:

, and his wife

Quote:

, and his mistress

That guy sure know how to live dangerously.

Hi teliot (and everyone else) thank you for the replies. Tangam wont release the maths behind those calculations (they say it is private information even though they are covered by a patent) what I'm trying to do is develop a mathematical formula (objective in every way). I know that there a many factors that contribute to table value (even the pai gow reply which I thought was very good) but I'm trying to get a theoretical formula for marginal revenue. Obviously there are too many variables to measure and many of them are not quantifiable but even a simplified formula would be very helpful.

It's perfectly understandable to look at the profit of a table and consider whether a different game would bring in more money. However one hidden factor is how a less profitable table can actually make the casino more money.

One of the things in the UK is a limited number of casinos allowed within each city/town. Many years ago a casino I knew had a craps table but the actual table didn't make much money (I'm guessing after costs it might have even been losing). So the casino took it out and then found their overall business went down.

At the end of the day you want people to go into YOUR casino. Having a different game, better food, cheaper parking, etc. can sometimes be the deciding factor. It can sometimes be a false economy if a bean counter is just looking at the bottom line profitbaility of a table.

Quote: joanmiller

Hi teliot (and everyone else) thank you for the replies. Tangam wont release the maths behind those calculations (they say it is private information even though they are covered by a patent) what I'm trying to do is develop a mathematical formula (objective in every way). I know that there a many factors that contribute to table value (even the pai gow reply which I thought was very good) but I'm trying to get a theoretical formula for marginal revenue. Obviously there are too many variables to measure and many of them are not quantifiable but even a simplified formula would be very helpful.

If you send me an email using your industry company email address, I'll send you a spreadsheet or two I created that does this, at least in bits. That should give you a starting point.

Goodness me that's so kind of you! Thank you so much! My email is . I really appreciate your help.

Oh you cant put emails in here sorry, I'm new to this forum so how do I send you the email address?

Quote: joanmiller

Oh you cant put emails in here sorry, I'm new to this forum so how do I send you the email address?

Go to my website ijmp.org . You will find my email address there. Again, I will need you to send your email to me from an email address with professional credentials in the casino industry.