Restructurings, Distressed Properties/Acquisition Services
Internet Gaming and Public Policy
Spectrum Gaming Group has marshaled an impressive array of resources to provide bondholders, bank lenders, investment bankers, creditors, buyers of existing properties and incumbent management with an independent, outside-the-box expertise to evaluate critical financial, legal regulatory and operational issues. We provide a wide variety of casino-related services, all of which share a common goal: to provide our clients with the best possible advice to help meet their strategic objectives or improve the financial performance of the business. Our expertise can be used to facilitate a restructuring, turnaround or acquisition of a business.
Spectrum’s executives and associates offer an unparalleled depth of experience in identifying opportunities and challenges. Our services are distinctive for several reasons:
- Spectrum has a well-deserved reputation for integrity. That means telling our clients what they need to know, and not what they want to hear.
- Spectrum professionals have operated for decades in the public and private sectors. We understand the political and regulatory challenges that operators must confront.
- Spectrum offers a 360-degree range of services for existing and prospective operators and investors. Our team includes experts in every field to address every line item in the P&L statement, from personnel to food and beverage, and from marketing to energy savings, as well as financial, business, legal, and integrity due-diligence.
- Spectrum professionals are equipped to protect the interests of investors and owners in any situation, to ensure that management is operating optimally and in the best interests of investors and owners.
Our fundamental belief is that our clients deserve analysis that is objective and comprehensive. Every part of an operation must be examined. That is why we address all disciplines. A Spectrum analysis looks beyond the past and present to provide a blueprint for future operations.
As with all of Spectrum’s services, integrity and transparency is our central mission. Our services include:
- Interim general management
- Labor engineering
- Product pricing and portion management
- Yield management of:
- Slot Floor
- Hotel Rooms
- Process reviews
- Back of the house review
- Employee benefits review
- Marketing business practices review
- Loyalty programming
- Customer reinvestment
- Align to marketplace
- Align to profit improvement
- Employee service training
- Legal and Transactional
- Legal spending and risk management analysis
- Identification and management of appropriate legal counsel
- Acquisition due diligence
- Specialized support for restructurings, acquisitions, and other transactions
- Internal controls
- Rules of the games
- Cash handling
- General ledger
- Mystery Shopping
- Employee theft detection gaming
- Selling of comps
- Employee service
- Quality of product
- Market Research
- Guest satisfaction
- Influential attributes
- Competitive reviews
- Due diligence
- Surveillance Services
- Employee skill assessment
- Policy and procedure review
- Technical capability
- Supervisory assessment
- Purchasing & Warehouse
- Business practice review
- Transfer procedures
- Par values
- Inventory liability
- Alcohol inventory control
- Bidding process review
- Purchasing contracts review
Download our October 15, 2009, audio conference: Distressed Gaming Properties: State of the Industry
Market, feasibility studies
Spectrum Gaming Group is a global leader in Internet gambling advisory services.
We are a prominent voice in Internet gambling legalization, operations and regulation. Spectrum has provided independent advisory services to state governments, state regulators, state lotteries, technology suppliers, Internet gambling operators, and land-based tribal and commercial gaming operators. Our clients recognize that, when it comes to executing online gaming in the United States, they need an adviser with a complete understanding of gaming – land-based gaming, lotteries and online gaming.
We were pioneers in examining how lotteries and casinos could work together in an online environment, and we fully understand all the online models that exist throughout the world, from Europe to Canada. Spectrum cuts through the i-gaming clutter to provide trusted, comprehensive and unbiased analysis and recommendations in every aspect of the sector, including:
- Market analysis
- Revenue estimation
- Feasibility studies
- SWOT analysis
- Public policy analysis
- Integration of online and land-based gaming systems
- Analysis of operating requirements
- Partner, provider and supplier assessments
- Business modeling
- Strategy development & execution
- Due diligence investigations
- Online research
- Player behavioral profiling & segmentation
- Player satisfaction benchmarking & measurement
- Internet marketing consulting
Spectrum Gaming Group is the first choice in evaluating all aspects the global Internet gambling industry:
- We are independent, unbiased and expert. We tell clients what they need to know, not necessarily what they want to hear.
- More than a decade ago Spectrum developed the Spectrum Internet Gaming Heuristic Theorem (SIGHT), which charted a course through which casino operators would move from rejection to acceptance to embrace of online wagering, and this theorem has proven to be extraordinarily valid and accurate.
- Spectrum’s team includes executives with extraordinary experience that spans the globe:
- We have particular expertise and experience in the regulation of gaming, having served as regulators in multiple international and domestic markets.
- Spectrum’s team includes the former General Counsel to Caesars Entertainment and the former Vice President of IGT Interactive and co-founder of Partis Solutions.
- Spectrum executives have testified on Internet gambling before many state and federal legislative bodies, including twice before the U.S. Senate Committee on Indian Affairs, and through such testimony Spectrum has become a global voice for addressing policy issues related to online wagering:
- In 2011 and again in 2012, Spectrum executives testified before the US Senate Committee on Indian Affairs at a hearing on the subject of “Regulation of Tribal Gaming: From Brick & Mortar to the Internet.”
- Our principals have offered Internet gaming-related testimony before the New Jersey Assembly Tourism and Gaming Committee.
- Stephen Brammell, former General Counsel to Caesars Entertainment, has joined Spectrum Gaming Group's online gaming advisory team to assist state lotteries, commercial operators and tribal governments as they develop new policies and business models in anticipation of legal online wagering in the United States.
- Spectrum authored the October 2010 white paper Internet Gambling Developments in International Jurisdictions: Insights for Indian Nations. Commissioned by the 184-member National Indian Gaming Association, the report examined the development and status of Internet gambling in Europe, and suggested strategies for entering the likely Internet gambling market in the United States. Spectrum formally presented the report at the NIGA Mid-Year conference in Prior Lake, MN.
“The report provided tribal leaders with the information that they need to evaluate Internet gaming policy and take the necessary steps to address the challenges and capitalize on the opportunities it presents to Indian country.”
- Mark Van Norman, consultant and former executive director, National Indian Gaming Association
- Spectrum produced a landmark study for the Massachusetts State Lottery Commission in December, 2012 titled Facing the Lottery’s Future: Implications and Strategies Regarding Internet Sales which provided detailed advice and recommendations for successful market entry and operations. The Lottery – the most successful in the United States on a per-capita basis – required Spectrum to develop a strategy which would intelligently leverage the Internet channel while protecting both the interests of its 7,400 retailers and the value of forthcoming casino licenses. (This public report is available here)
- Spectrum is a leading voice in the global Internet gambling industry. We have been honored to chair GiGse (the Global iGaming Summit & Expo) for the past five years, and the 2012, 2011 and 2010 EiG (European iGaming Congress & Expo) in Barcelona, Milan and Copenhagen. Spectrum has additionally spoken on the subject of Internet gambling at the Global Gaming Expo, ICE, and Eastern European Gaming Summit, among other prominent conferences.
- Spectrum’s own hallmark conference, the East Coast Gaming Congress & iGaming Institute, brings together the top legislators, regulators, operators, suppliers, and other experts in the iGaming industry. The 2014 edition of ECGC, held in Atlantic City, was widely reported in the international press for the quality of its content and the important views and opinions expressed there by prominent figures in iGaming.
- Spectrum partnered with Victor Rocha, founder of Pechanga.net, to bring the highest quality iGaming expertise to Indian Country. This partnership has produced the 2013 and 2014 Indian Country Online conference and the 2014 iGaming Legislative Symposium.
- Spectrum is currently providing comprehensive market analysis and business development services for European companies contemplating entry into the US Internet gambling market.
- Spectrum has conducted numerous studies into Internet gambling, including a groundbreaking study concerning money-laundering and Internet gambling for the Interactive Gaming Council.
- Spectrum was engaged by two California tribal governments – which have successful land-based casinos – to advise them of Internet gambling strategy.
- Spectrum was retained to conduct a study relative to money laundering and Internet gambling for the Interactive Gaming Association. This was a ground-breaking study that discussed money laundering, payment methodologies and Internet Gaming.
- Spectrum authored an analysis titled “Contractual Issues Arising from the Affiliate/Online Gambling Operator Relationship” in the December 2010 issue of World Online Gambling Law Report.
- Spectrum and its affiliate Spectrum-i have conducted numerous due diligence investigations involving Internet gaming for national, tribal and state governments – and for private clients seeking a pre-licensing suitability evaluation.
- Spectrum was retained by a major European company to research and model a comprehensive Internet gambling business, including market research, demographic analysis, demand modeling, revenue projections, assessment of required resources, identification of operational and strategic partners, and development of a comprehensive business model. This report was presented by Spectrum’s client to its national government for the purpose of legalizing this form of Internet gambling.
- Spectrum was engaged by a globally prominent gaming and hospitality company in a multi-phase project that includes a comprehensive market evaluation, strategic planning, evaluation of business opportunities across the company’s entire portfolio, development of broad-based business model, and evaluation of current assets and integration into Internet gambling.
- Spectrum assisted a major international hospitality company to develop a strategy and identify the most effective suppliers for implementing a mobile Internet wagering system.
- Spectrum professionals produced a comprehensive report for a trade organization analyzing the economic impact of live remote wagering via the Internet.
- Spectrum associates have conducted substantial secondary research explorations in the online gambling field that include industry profiles, competitive intelligence & analysis.
- Spectrum associates have compiled a body of primary research findings including influential attributes of attraction, player satisfaction, online loyalty club content and deployment, competitive wallet share, creative concept testing, player development, software evaluation, website usability, online deposit process improvement, currency preferences, and VIP poker player unmet needs and satisfaction. These primary research efforts include traditional methods as well as the latest online research methodologies.
- Spectrum professionals have provided confidential marketing consulting to the world’s largest internationally based Internet gaming companies, including the world’s largest Internet casino operator as measured by advertising spend and the world’s leading listed Internet gaming provider as measured by stock ownership.
- Most recently, Spectrum joined forces with Tottenham & Co. to form a global one-stop consultancy for both land-based and interactive gaming.
Economic Impact Reports
When projections and impacts count, count on Spectrum Gaming Group. Developers and investors have relied on Spectrum to determine the feasibility of building multibillion-dollar projects on the Las Vegas Strip, as well as in Atlantic City and Macau. We have worked in dozens of other markets around the world, from Pennsylvania to Vietnam, and from Louisiana to Canada. Wall Street repeatedly turns to Spectrum when weighing gaming investments of hundreds of millions of dollars. Our clients know that our reports are conservative in their projections and comprehensive in their approach. We combine quantitative and qualitative analyses that result in a thorough, independent and reliable analysis. Spectrum stands out in this field because we combine reliability and transparency with a comprehensive approach that includes assessing political and competitive risks. Our economic services include:
- Feasibility studies
- Market analyses
- Reasonableness tests
Spectrum studies are always built from the ground up, as we believe no two markets are ever alike. We perform on-site reviews, and we focus on key issues that can have a serious impact on revenue and profitability, as appropriate, including:
- The competitive landscape throughout the region
- Political and regulatory issues that are bubbling up, and are not on most radar screens
- Economic and demographic trends
- Projected competitor responses.
- Access, and ease of movement to the site
Finally, we would perform both a demographic analysis of the region and gravity modeling to determine potential revenue performance, based upon the adult population and income levels in surrounding, or catchment, areas.
As needed, we will develop other models as well, and can perform complex studies such as Monte Carlo analyses. We also, as needed, develop sensitivity and optimization models, all of which help our clients better understand their options.
Most important – and this is a point of particular pride to all of us at Spectrum – is that we tell our clients in advance that we will not reach a pre-determined result. Indeed, our findings may prove to be contrary to their plans. Still, those who depend on our reports – be they investors, operators, regulators and others – know full well that Spectrum stands behind its findings. That is why we are the gold standard in such studies.
Gaming Regulatory Services
Spectrum principals have been studying the social and economic impacts of gaming for three decades, and indeed we take pride in pioneering this particular discipline.
Managing Director Michael Pollock has been studying the impacts of casinos for more than 32 years, and authored the book, “Hostage to Fortune: Atlantic City and Casino Gambling,” published in 1987 by the Center for Analysis of Public Issues in Princeton, NJ.
We have experience in producing economic-impact analyses in the following states, territories and foreign nations:
- New Jersey
- New York
- Puerto Rico
- South Korea
Each Spectrum project is customized to our client’s specific requirements and developed from the ground up. Our findings, conclusions and recommendations are based solely on our research, analysis and experience. The Spectrum team includes our partners:
- Regional Economic Models Inc. (REMI) of Amherst, MA
- Douglas M. Walker, Ph.D., Senior Academic Affiliate
REMI is the gold standard in economic-impact studies, and the REMI Spectrum team has produced robust, comprehensive studies in markets ranging from Florida and Iowa to Massachusetts, Indiana, Illinois and Kentucky.
Doug Walker is a professor of economics at the College of Charleston, in Charleston, South Carolina. He also owns a consulting firm, Casinonomics Consulting, LLC. Walker is recognized as a top expert in the world on the economic and social impacts of casinos. He has worked with Spectrum on numerous engagements, including major projects in Florida, Iowa and Indiana.
Our economic-impact studies stand out for several key reasons:
- We spend considerable research meeting with a variety of crucial stakeholders, from legislators and regulators to small business owners and labor leaders, among others.
- We recognize that economic impacts are not static, and that the impacts can differ based on public policies. Where appropriate, we will recommend policies that could enhance the economic benefits and minimize the negative impacts.
- Spectrum approaches all such studies with a combination of candor and experience. We analyze impacts as they are – or could be. We never tailor our findings to benefit a client
Our studies have been rather high-profile:
“This [Spectrum] report should be required reading by every state official. ... [T]he report reads like a good investigative series, and takes a big-picture view.”
- Hartford Courant editorial, July 5, 2009
“The administration ought to revive the proposal to reflect the findings in the independent analysis conducted by Spectrum Gaming.”
- Boston Herald editorial, August 8, 2008
“[The Spectrum study] provides each side with plenty of objective analysis to consider. ... The Spectrum study makes the essential point ... The study makes a powerful case ... The report issues another important warning ... The report's authors know all the angles played by casino developers.”
- Boston Globe editorial, August 15, 2008
“According to a 2011 Spectrum Gaming Group study, by 2015, it is estimated that Kentuckians will export at least $527 million in gaming revenues to casinos in nearby states, generating tax revenues to build roads, bridges and schools in Indiana, Illinois, Ohio, and West Virginia.”
- River City News, Kentucky, October 8, 2013
“(A) study estimates the pending legislation could generate nearly $200 million in additional tax revenue for the state each year and create nearly 20,500 jobs throughout Illinois. The study was conducted by Spectrum Gaming Group, a research company, and was paid for by the Illinois Revenue and Jobs Alliance, a consortium of business, gaming, agriculture and racetrack interest advocating for the passage of SB 1849, an Illinois bill which calls for the expansion of gaming.”
-St. Louis Business Journal, April 17, 2012
“The study examined eight crimes and their frequency in the casino counties. Joseph Weinert of the Spectrum Gaming Group dealt with that part of the study and says the crime rates were up. ‘That is to be expected because they draw a lot of visitors from outside the county. So, the more people you have, the more crimes that are going to be committed,’ Weinert explains. ‘However, when you look at the crime rates, they are not adjusted for those extra visitors.’ ”
-Radio Iowa, June 13, 2014
“The opening of two major gambling resorts in Broward and Miami-Dade counties (in Florida) could generate about $1 billion in taxable gambling revenue per year and create 7,618 full-time jobs, under one scenario analyzed in a report to the state Legislature by Spectrum Gaming Group.
-Sun Sentinel, October 1, 2013
Investigations and Due Diligence (Financial and Integrity)
Government agencies and regulatory commissions routinely engage Spectrum Gaming Group for myriad services when introducing or expanding casino gambling. Spectrum’s team of former regulators, enforcement agents and attorneys collectively has decades of experience in all aspects of regulation. Our services include:
- Licensing investigations
- Drafting of legislation and regulations
- Anti-money laundering controls
- Drafting and implementing minimum internal control standards
- Compliance auditing
- Investigations relating to cheating, swindling, fraud and abuse
- Establishment of investigative procedures
- Evaluation of public policy
The Spectrum team has extensive regulatory experience dating back three decades in the opening of casinos. Many members of the team – who had the privilege of serving as regulators for the state of New Jersey – played key roles in the opening of Atlantic City casinos. Spectrum has also been retained to open casinos on behalf of state and tribal regulators, having performed such engagements in West Virginia, Delaware and for the Four Winds Casino in Michigan.
We have evaluated public policy for both the Governor’s office and the House of Representatives in Massachusetts, and for the Connecticut Division of Special Revenue.
We take particular pride in noting that many states and nations that are contemplating casinos will reach out to us to get some candid, professional and independent advice.
Spectrum professionals, for example, testified at a hearing of the New Hampshire Gaming Study Commission, which prompted the following note from Chairman Andy Lietz: “Thank you for extending the courtesy of your time and expertise on the topic of regulatory issues affecting gaming enterprises at the state and federal level. The information you provided was extremely helpful, and your insights into the challenges and opportunities of setting up appropriate regulatory structures early in the process was very valuable.”
We appreciate such testimonials, and note that we have provided valuable testimony to numerous study committees, from the National Gambling Impact Study Commission to the U.S. Congressional Gaming Caucus.
Legal Support and Expert Witness Service
Spectrum is the established worldwide leader in providing due diligence investigations regarding a license applicant’s suitability on behalf of casino gaming regulatory authorities. Our firm has conducted numerous complex and sensitive license investigations that have withstood scrutiny and have engendered unbridled public confidence. Since 1993, Spectrum has provided investigative services regarding casino operators and executives, gaming vendors and casino employees. We perform detailed background checks and investigations to provide gaming regulators and operators with the vital information they need to make critical decisions concerning approvals and associations.
Spectrum has worked for governments from Singapore to Puerto Rico and from Maine to Maryland, providing services maintaining the highest standards of competence, professionalism and integrity. We appreciate the trust that these gaming jurisdictions have placed in our company.
Our staff consists of former senior gaming regulators who played instrumental roles in developing and implementing New Jersey’s time-honored regulatory system. The years of experience and knowledge of gaming regulation and related investigations are unparalleled. Spectrum’s distinguished team offers credibility and expertise in this specialized field.
Managing Director Fredric Gushin has extraordinary experience in this critical discipline, having worked 13 years for the New Jersey Division of Gaming Enforcement, where he was promoted to Assistant Director and Assistant Attorney General. At the DGE, Gushin oversaw the openings of 12 Atlantic City casino hotels and managed civil and administrative litigation before the New Jersey Casino Control Commission.
Director of Legal and Regulatory Services Steven Ingis is a former Assistant General Counsel with the New Jersey Casino Control Commission. In that capacity, Ingis managed the Licensing Unit in the Office of the General Counsel, and was responsible for all casino employee and entity licensing matters. During his tenure with Spectrum, Ingis has been the lead attorney assigned to conduct license investigations on behalf of several gaming regulatory agencies.
Our extensive experience includes a recent engagement with the Maryland Lottery Commission to conduct a myriad of suitability investigations with respect to applicants for operator and vendor licenses. The Maine Harness Racing Commission, the Government of Singapore and the Commonwealth of Puerto Rico retain Spectrum on a regular and continuing basis to conduct a litany of license investigations. These gaming jurisdictions rely unequivocally upon Spectrum’s impeccable reputation for unyielding independence in the performance of our due diligence services and our company’s demonstrated ability to conduct efficient and comprehensive investigations on an expedited basis.
Casino Development Services
Trial attorneys, regulators, prosecutors and gaming operators turn to Spectrum Gaming Group and its decades of experience in areas such as support for criminal prosecution, gaming enforcement, game protection and security. As our knowledge of gaming is unparalleled, so is our value to our clients. Spectrum’s array of legal support services includes:
- Review of gaming statutes to ensure comprehensive statutory structure
- In-service training for police, prosecutors and casino security
- Overview of casino crime
- Investigative techniques
- Evidential issues
- Bank Secrecy Act/Money Laundering
- Litigation support – civil and criminal
- Review evidence
- Trial preparation/strategy
- Expert witnesses and litigation services
Our work in the field of expert testimony and litigation support is a point of particular pride to us. We make it clear from the outset that we do not – and will not – tailor our findings to anyone’s need. Our conclusions are based on our unmatched blend of experience and hard work.
Our experts have been deposed many times, and have offered testimony in a variety of serious matters. Such work has taken us from court rooms in San Jose, CA to the International Tribunal at the Peace Palace at The Hague to the World Bank in Washington, DC. Attorneys and others who prize our candor and work ethic count on Spectrum Gaming Group.
Our work in this specialty includes the following:
- Senior Spectrum executives served as expert witnesses before the Puerto Rico Racing Board regarding the impacts that retail video lottery terminals would have on the commonwealth’s casino industry.
- Spectrum served as an expert witness in the case of Las Vegas Sands Corp. v. Ace Gaming, LLC, 713 F.Supp. 427 (D.N.J. 2010) A summary judgment was issued in favor of Spectrum’s client, Duane Morris LLP (representing Las Vegas Sands), in its action regarding the breach of a trademark-licensing agreement involving the use of the “Sands” trademark.
- Spectrum testified on behalf of the Republic of Croatia at The Hague before an arbitration panel established by the United Nations Commission on International Trade Law (UNCITRAL). Croatia was defending itself against a claim by a casino operator that it was owed more than €80 million. The claim was dismissed by the panel “in its entirety.” Croatia has hailed the decision as a “landmark victory.”
- Spectrum professionals served as expert witnesses in litigation related to the collapse of a parking garage at Tropicana, prior to the opening of The Quarter in Atlantic City. Our work in that matter included analyzing the potential impact of that collapse on revenue and profitability. Our client was the Tropicana, and litigation centered on projecting the amount of business lost as a result of the garage collapse.
- Spectrum was retained through the law firm of Volterra Fietta to perform extensive expert witness work regarding identifying the value of a potential gaming concession in Hungary that was revoked by the host country, following a change in government. Our work involved reviewing other expert witness reports, and in determining the value of gaming concessions and licenses around the world, to help determine the value of this lost concession.
- Spectrum has been retained by a major national law firm in litigation brought by an Indian tribe against its client. We are analyzing economic conditions at the time, as well as providing valuation-related analysis regarding the economic climate in the tribe’s home state during the relevant period.
- Spectrum was retained by a North American gaming operator to quantitatively and qualitatively assess the impacts that illegal and/or unregulated gaming was having on the jurisdiction’s legal gaming operations.
- Spectrum was retained by the City of Atlantic City in litigation regarding the valuation of Borgata Hotel, Casino & Spa regarding the valuation of the property for tax purposes. Following the release of our report, the parties reached a settlement.
Casino Operational Services
Spectrum executives and associates have decades of casino operational and regulatory experience at senior-management levels in multiple jurisdictions, and are equipped to assist with the major tasks essential to:
- Designing appropriate casino hotel facilities to best serve targeted markets.
- Developing a realistic long-range casino marketing plan; providing adequate and cost effective internal controls and operating procedures.
- Providing the best casino management team for the operation.
- Assuring a smooth and timely opening; and providing operations monitoring on behalf of the Owner for the early years of the casino hotel’s operations.
The following list of tasks is designed to offer some basic guidance as to the nature of the complex task of taking a casino from concept to operation. This process, by definition, requires flexibility to include additional tasks and address unanticipated challenges that will arise during this important process.
Development and Pre-Opening Services
- Meet with the Owners/Developers to become thoroughly familiar with your intentions for the overall project as to facilities, quality and intended market positioning.
- Review the status of casino licensing efforts to date, and, working with counsel, assist in any procedures that have to be followed. We also will work with counsel in assuring that all operational requirements as set forth by the jurisdiction’s Gaming Act and regulations are fully implemented. We are also available to appear before the governmental agencies including gaming commissions on various issues.
- Review any currently proposed casino layout(s) and suggest refinements in the layout as appropriate, or create a casino layout of table games, electronic games poker and bingo operations based on our understanding of the markets to be served. Alternatively, working with the project architect, we will design the casino floor.
- Review any currently proposed back-of-the-house plan(s) and suggest changes and improvements from the operator’s viewpoint, and incorporate governmental requirements, if any, or, as in the case of the casino layout, develop a plan for casino back-of-the-house spaces.
- Develop a list of electronic games best suited to the markets the casino is intended to serve, detailed by brand, numbers, types, games, denominations of slot machines, and the desired pay-out of each game.
- Develop pre-opening and ongoing casino department staffing plans for preliminary budget purposes.
- Create casino furniture, fixtures and equipment (FF&E) and operating supplies and equipment (OS&E) budgets and periodically update the budgets as requirements dictate.
- Review and adjust any in-house or third party market study that has been completed, specifically refining the potential for the casino as new information is developed. Alternatively, we will develop the casino market plan.
- Develop projections of operating revenues, expenses, and departmental profit for five years and various other time frames as necessary. We will use a computer model for the casino projections which can be used throughout the development phase to analyze the many “what ifs” propositions that will arise due to variations of the targeted markets, adjustments in the casino’s facilities or opening date, changes in governmental regulations, etc., and as a basis for ongoing operations budgeting.
- As the casino developmental consultants, assist project architects, engineers, and interior designers in planning the casino, the supporting public areas, and essential back-of-the-house casino spaces to assure optimum patron flow as well as operational efficiency. Also in this capacity, review plans and interiors programs from the viewpoint of precluding, for example, the selection of a color pattern, which might interfere with surveillance of the casino.
- Develop a security plan for the casino.
- Develop a system of internal controls for the casino.
- Develop credit policies and procedures for the casino.
- Develop a comp policy for the casino.
- Develop specifications for casino software systems, solicit bids and recommend to the Owner casino computer systems for: player ratings, comps and credit extension; cage management and accounting; and electronic games management.
- Act as project liaison with governmental bodies including gaming commissions in planning for and accomplishing tasks needed to be completed before the permanent staff is retained.
- Assist the Owner in the process of screening and selecting casino executives – or outside managers -- whom the Owner will hire to operate the casino.
- Act as the Owner’s liaison with the selected casino executives and monitor the quality and timeliness of the executives’ performance in such areas as:
- staffing, planning, selection and hiring
- casino marketing planning and budgeting
- pre-opening planning and budgeting
- licensing of casino key employees
- training of casino staff
- controlling casino pre-opening costs
- Act in close concert with and in support of the casino executives in accomplishing all governmental regulatory requirements preparatory to the public opening of the casino.
- Conduct background investigation and other due diligence examinations regarding suppliers, key casino employees, junket representatives, etc.
Casino Opening Assistance
- Two to four weeks prior to opening of the casino, supplement the executive staff with highly experienced operational professionals at the cage, casino floor and in surveillance. These Spectrum Associates will test the knowledge of the casino supervisors and staff members in the specific requirements and procedures of the casino’s accounting and internal control systems, standard operating procedures, surveillance requirements, the handling of all cash and cash equivalents, etc., and will provide additional on-the-job training as needed to ensure a smooth opening.
- Act as the Owners’ expert eyes and ears in monitoring overall casino operations and protecting the assets of the casino. We are available to serve on the casino’s Compliance Committee.
- Monitor credit issued by the casino and subsequent collection performance; and monitor the performance of junket representatives.
- Conduct compliance audits of the casino’s performance at six and twelve months after opening.
- Perform the typical casino internal auditing function on an outsourced basis.
- Assist casino executives in developing long-term plans for the expansion of existing and potential customer bases.
- Conduct covert gaming-related investigations.
- Monitor the casino’s performance in terms of acquiring and building market share, relative popularity in the local market segment, reaction to shifts in the marketplace, etc.
Professional Services for Indian Nations
Spectrum executives and associates have decades of casino operational experience at senior-management levels in multiple jurisdictions. Whether managing the entire gaming operation on an interim basis, gauging guest satisfaction or correcting performance metrics, we can provide solutions to improve your gaming operations. Our services include:
- Labor engineering, adjust staffing levels to volume levels with mathematical credibility.
- Gaming compliance audits.
- Employee theft and fraud investigations.
- Customer loyalty reinvestment programming design.
- Onsite review services of business processes and practices with profit enhancing change recommendations.
- Guest service program design and measurement.
- Business planning and analytical services.
- Operating distressed casino properties or casinos operating in conservatorship
- Evaluating and remedying the operations of underperforming gaming operations
Spectrum has established a history of working with Tribal Governments and Tribal Gaming Commissions in many ways over the years with the highest degree of integrity, confidentiality and professionalism. Managing Director Fredric Gushin served multiple terms over a 10-year period as a Commissioner with the Oneida Indian Gaming Commission in Verona, NY. Spectrum has been retained by more than 25 Indian Nations to evaluate overall operations of gaming facilities and gaming commissions, perform compliance audits pursuant to the Minimum Internal Control Standards on an outsourced basis, and help focus the tribe’s overall approach to operational and regulatory issues. We have conducted feasibility studies and strategic planning services on behalf of Tribal gaming operating entities and Tribal Governments, and offer an extensive menu of services including:
- Performing operational audits
- Evaluating the performance of casino management
- Conducting evaluations of gaming commissions
- Preparing economic feasibility studies
- Preparing market analyses
- Performing casino compliance audits under the MICS on an outsourced basis including Title 31 independent audits
- Strategic Planning
- Preparation and upgrading of all aspects of casino controls
- Conducting due diligence and background investigations
- Conducting Surveillance Department evaluations and audits
- Preparing Compliance Manuals for use by gaming commissions
- Budgeting for Gaming Commissions
- Evaluating opportunities for Internet gaming
Spectrum Gaming Group has amassed a highly successful record working with many Indian nations, tribes and organizations, including:
- National Indian Gaming Association
- Gila River Indian Community
- Mashantucket Pequot Tribal Nation
- Navajo Gaming Enterprises
- Oneida Indian Nation
- Pokagon Band of Potawatomi Indians
- Pueblo of Ohkay Owingeh (formerly San Juan Pueblo)
- Seneca Nation of Indians
- Seneca Gaming Corporation
- Cherokee Nation
- Little River Band of Ottawa Indians
- Tohono O’odham Nation
Some of our specific engagements have included:
- Spectrum has performed numerous studies and has acted as a leading business advisor to the Seneca Gaming Corporation in New York. We have conducted analysis of the current gaming businesses as well as performing market analysis of potential opportunities.
- Spectrum is currently retained by the Seneca Gaming Corporation’s Board of Directors as their gaming business advisor.
- The National Indian Gaming Association retained Spectrum to provide a detailed overview of the evolution of Internet gaming in Europe and Asia to glean lessons for tribal operators in the United States. Spectrum is presently completing this report, which includes some very specific guidance to help tribal operators understand both the opportunities and challenges that they will likely face as Internet gaming evolves.
- Spectrum performed a feasibility study on a proposed Glendale, CA, casino hotel, with restaurants, showroom and spa, for the Tohono O’Odham tribe.
- Spectrum was retained by the Pokagon Band of Potawatomi Indians tribal government to plan, develop and implement the complete regulatory process that accompanied the development of Four Winds Casino Resort in Michigan. Spectrum’s efforts played a major role in ensuring the smooth opening of this property.
- Spectrum was retained by the Gila River Indian Community to perform a comprehensive amenity study and related analyses in anticipation of a significant expansion of the tribe’s gaming and related facilities at Wild Horse Pass.
- Spectrum performed a detailed study for the Ohkay Casino, a tribal facility in San Juan Pueblo, New Mexico to determine the feasibility of adding a conference and special events center, as well as a hotel expansion. The study included projections of cash flow, and suggested marketing strategies as well.
- Spectrum undertook an economic analysis study for Little River Band of Ottawa Indians in Michigan. The Governor of Michigan indicated a willingness to consider the amendment of compact between the State and Indian Nations for additional casino projects. Spectrum evaluated potential casino markets in the region and prepared preliminary financial projections. Spectrum also reviewed and evaluated the Indian Nation’s existing hotel casino resort and made recommendations relative to expansion of that facility.
- Spectrum was retained by Empire Resorts, developer of a planned Indian casino in New York, to produce a report to be evaluated by the Bureau of Indian Affairs that would project revenue, and determine differing levels of visitation based on changes in capital spending.
- Spectrum has been retained by a tribal casino in New York to review and evaluate its operations and internal controls, with an eye toward identifying potential cost savings and to assure compliance with Minimum Internal Control Standards.
- Spectrum completed a detailed economic and financial impact study for Sullivan County, NY, government designed to guide the county – at the heart of the Catskills – as it plans to host as many as three Class III tribal casino hotels. The report, now a public document, details impacts in various areas, ranging from education to housing to tourism. This was followed by a similar report for nearby Orange County, NY.
- Spectrum has recently conducted a complete business process review of the marketing functions for the Seneca Gaming Corporation. The review was inclusive of three operating casinos that have a significant six-figure customer database with a consumer market with a radius of over 200 miles. We indentified potential expense savings in the tens of millions of dollars.
- In 2008 Spectrum, was retained by the Seneca Gaming Corporation to conduct a labor audit of its three casinos. The audit measured and evaluated staffing levels as compared to seasonal volume levels. As a result of the audit and accompanying regression analysis the corporation reduced its total staffing levels by 400 employees in November 2008. The expense saving realized were nearly $10 million annually.
- For the Gila River Indian Community, Spectrum completed a comprehensive feasibility study and related analyses in anticipation of a significant expansion of the tribe’s casino resort.
Tax policy guidance for public officials, casino operators
Technology is revolutionizing casino floors around the world, from cashless systems to server-based gaming. Spectrum Gaming Group is continuously positioned at the cutting edge of new technology, providing services for equipment manufacturers, gaming operators and regulators. Among our services in this field:
- Technology concept or implementation review and analysis
- Technology concept operational impact
- Network security review
- Electronic revenue analysis, procedures and implementation
- Regulatory compliance of manufacturer’s new concepts and designs
- Server-based and server-supported concept review and implementation
Strategic planning for operators, suppliers, investors
Spectrum Gaming Group‘s peer-reviewed white paper on gaming tax policy notes in its opening paragraphs: “The legalization of casino gambling is arguably one of the most critical public policy decisions that state lawmakers will make during their tenure. Such legislation authorizes an entirely new industry that offers a wide range of potential impacts. While lawmakers will pay close attention to many facets of the proposed legislation – from the number of casinos to their locations and licensing requirements – few lawmakers pay close attention to what is arguably the most essential aspect of gaming legislation: the tax rate on gross gaming revenue.
“The tax rate on gaming is the most vital public policy decision that legislators will make, as it offers implications in a variety of areas, including:
- Level and type of capital investment
- Tourism enhancement
- Demographic and geographic appeal of a casino
“The tax rate will help determine the type of business model that casino operators will pursue, yet it is rarely given the proper level of scrutiny. If anything, decisions related to the tax rate are often based on political considerations. In some cases, the importance of the rate as an engine that will guide long-term policy is simply misunderstood.”
For nearly a decade, Spectrum professionals – due to their background as government officials, as journalists and as operators – have been helping public officials and private operators gain that critical understanding.
Spectrum has worked with the public and private sectors to analyze and craft tax policies to help ensure that casino revenue taxes are designed to best advance public policy. This means policies that encourage capital investment, employment, tourism growth and other policy goals. At the same time, our approach helps states look at gaming through a wide lens by analyzing impacts on all forms of revenue, from employee spending to corporate taxation. Our work has been used in states ranging from New Jersey to Massachusetts to help guide existing and developing tax policies. In November 2010, we presented a peer-reviewed white paper, “Casino Tax Policy: Identifying the Issues that Will Determine the Optimal Rate,” at the National Tax Association 103rd Annual Conference on Taxation, held in Chicago. Thomas A. Garrett, assistant vice president of the Federal Reserve Bank of St. Louis, reviewed the report and led a discussion on its findings.
In 2003, Spectrum produced a report that helped educate New Jersey officials as to the potential ramifications of a proposed tax increase on gross gaming revenue for casinos in Atlantic City. Due in large measure to the findings in that report, state officials reconsidered that proposal in light of some potential unforeseen consequences.
Five years later, Spectrum produced a comprehensive report for the governor of Massachusetts (available here) that helped officials there understand the overall revenue implications of their proposed tax policy.
We have worked in various states and nations, from Indiana to Korea, on similar projects.
Our analyses are prized, in large measure, because of their objectivity and credibility. For example, our Massachusetts report was praised in editorials by the competing Boston major newspapers (which rarely agree on anything):
Spectrum Gaming Group is known globally as an authoritative, independent source for understanding trends in gaming. For six years, we have published our Top 21 trends in gaming and for 16 years, we have published the award-winning Gaming Industry Observer, which identifies tracks and analyzes numerous trends.
Now, we marshal our extensive knowledge of political, demographic, technological, regulatory and competitive trends to help position our clients for the future.
Our team bolsters its own unrivaled knowledge by building a team with our strategic partners. These partners have deep knowledge in all relevant areas, from consumer trends to Internet wagering to casino design and utility costs.
This comprehensive service has been designed to assist operators (commercial and tribal), suppliers and investors by customizing an analysis that meets their particular goals, based on their existing assets and positions.
The service includes identifying both opportunities and challenges. For operators and supplies, it starts with an assessment of:
- Where the client is located, geographically and by business model
- Where the clients intends to be in the future
For investors, we perform a similar, customized analysis that starts with assessing their goals as well.
Our skilled team – with decades of experience in government, operations and other disciplines – works side by side with each client to assess those targets, and then develop strategies to achieve the optimal goals.
On a macro level, we review a variety of shifting trends in everything from potential changes in federal and state legislation to the likelihood of Internet gaming and its implications.
On a micro level, we review the in-state and regional competitive landscape, down to the potential economic shifts in any particular market.
We can help you develop anything from a global strategy to a strategy limited to one state or Indian reservation.
Most important, we work with your in-house team by leveraging your existing talent and knowledge to develop a comprehensive, credible plan that gets you to your goals.
The gaming world is changing rapidly, with different forms of gaming converging as technologies, political priorities and player preferences change. Spectrum Gaming Group has worked with numerous state lotteries and related authorities, including agencies in Delaware, West Virginia, Connecticut, Massachusetts, Georgia and Ohio, to help them analyze where they are, and how to carry out new mandates in this period of rapid change.
We take great pride in the work we perform on behalf of lotteries. Consider what Leon Galls, an independent blogger, wrote about our report for the Georgia Lottery:
“That leaves the Spectrum Group’s study. I thought when I started working through it that it would be just more industry cheerleading. But it wasn’t. It was a sober, professional piece of work full of cautions and qualifications.”
In 2010, Spectrum was honored with a “Governor’s Team Excellence Award” certificate issued by Delaware Gov. Jack Markell for our work in helping to implement table games.
Services for lotteries include:
- Private management advisory work
- Planning properly for the implementation of online gaming, including strategies to assist lottery retailers
- Helping to regulate table games
- Investigating the backgrounds of vendors
- Helping ensure that lotteries are protected as states add new forms of gaming
- Assisting in the establishment of effective, well-regulated Video Lottery Terminals
- Assessing Internet lottery market opportunities and developing market entry strategies
- Online lottery product analysis, development and implementation
As Internet gaming comes closer to reality in the United States, and as lotteries face calls for private management of their operations, they need Spectrum and its suite of services more than ever.
In 2012 the Massachusetts State Lottery Commission retained Spectrum as their Internet advisor to provide expert advice as to whether it should consider offering online wagering and, if so, how it could proceed. The Lottery – the most successful in the United States on a per capita basis – required Spectrum to develop recommendations that would protect the interests of its 7,400 retailers while simultaneously preserving the value of forthcoming casino licenses. Spectrum produced a detailed report that is serving as a blueprint for all relevant aspects as to how the Lottery should venture carefully and methodically into online gambling.
To read this seminal report click HERE.
Spectrum has also worked with the Georgia Lottery to project revenues from VLTs and to suggest the parameters of an effective regulatory structure. In both Delaware and West Virginia, we helped those two state lotteries add table games to their existing VLT offerings. Spectrum associates have also been closely involved in primary research exploring the relative appeal of lottery games as well as effectively marketing new lottery products.
Qualitative and quantitative research with casino and lottery customers leveraging traditional, online and emerging data collection methodologies engineered to provide key insights and actionable findings.
- Primary Research Applications:
- Quantitative Surveys
- Tour & travel
- Market studies
- Player segmentation
- Demographic profiles
- Player attrition/lapsation/churn
- Advertising effectiveness tracking
- Wallet share
- Influential attributes of attraction
- On demand polls/surveys
- Brand image assessment
- Satisfaction benchmarking
- Customer acquisition & retention
- New product development
- Market segmentation
- Loyalty program assessment
- Marketing competitive intelligence
- Advertising concept testing
- Internet game testing
- Website usability testing
- Process improvement
- Point of sale service/technology assessments
- Casino mystery shopping
- Competitive intelligence
- Service quality enhancement
- Service standard development & measurement
- Players club assessment
- Marketing return on investment assessment
- Qualitative Methodologies:
- Focus groups
- Individual in-depth interviews
- Ethnographic studies
- Quantitative Methodologies:
- Traditional surveys
- Computer Aided Telephone Interviewing (CATI)
- Computer Aided Personal Interviewing (CAPI)
- Emergent methodologies:
- Discussion boards (asynchronous)
- Text based online focus groups
- Webcam focus groups
- Webcam interviews
- FaceTime interviews
- Mobile service touch-point evaluation
- Social media monitoring
- SPSS statistical analysis
- Conjoint analysis
- Perceptual mapping
- Maximum difference scaling (MaxDiff)
- Cluster analysis
- Gap analysis
- Sensitivity analysis
- Regression studies
- Predictive analytics
- Gravity modeling
- Marketing analysis
- Free play analysis
- Marketing comp & promotional reinvestment analysis
- Revenue modeling
- Database valuation
- Slot floor optimization