Sample business plan for Newton Group Marketing's professional business plan writing services.
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1. Great Canadian Gaming Corporation
Business Plan
2011 - 2013
Great Canadian Gaming Corporation Page 1 of 35
2. Table of Contents
Executive Summary ................................................................................................................... 4
1.0 Business of the Company ..................................................................................................... 5
1.1 Business Summary & History ........................................................................................... 5
1.2 Industry Overview ............................................................................................................. 5
1.3 Current Situation of the Company ..................................................................................... 7
1.4 Goals and Objectives........................................................................................................ 7
1.5 Key Success Factors ........................................................................................................ 8
1.6 Structure of the Company ................................................................................................. 8
2.0 Product / Service Description ............................................................................................... 9
2.1 Detailed Description of Product/Service................................................................................ 9
2.2 Stage of Development of Product / Service ...................................................................... 9
2.3 Certification and Regulatory Standards Required ........................................................... 10
2.4 Customer Benefits Provided by Product/Service............................................................. 10
3.0 Market Analysis .................................................................................................................. 11
3.1 Target Market Profile ...................................................................................................... 11
3.2 Total Market Size............................................................................................................ 11
3.3 Trends ............................................................................................................................ 12
3.4 Estimated Company Sales and Market Share ................................................................ 12
3.5 Rules of Purchase .......................................................................................................... 13
4.0 Competition ........................................................................................................................ 14
4.1 Direct Competitors – Present and Future ........................................................................ 14
4.2 Indirect Competitors – Present and Future ..................................................................... 15
4.3 Substitute Products or Services ...................................................................................... 15
4.4 Competitive Edge ........................................................................................................... 15
4.5 Competitive Analysis Chart ............................................................................................. 16
5.0 Marketing Strategy ............................................................................................................. 17
5.1 Positioning ...................................................................................................................... 17
5.2 Sales Strategy and Tactics ............................................................................................. 18
5.3 Advertising and Promotion Plans .................................................................................... 18
5.4 Advertising and Promotion Calendar .............................................................................. 19
5.5 Pricing Strategy .............................................................................................................. 20
5.6 Channels of Distribution.................................................................................................. 20
5.7 Public Relations and Publicity Plan ................................................................................. 20
6.0 The Management Team ..................................................................................................... 21
6.1 Key Management Team Profiles, Qualifications, and Responsibilities ............................ 21
6.2 Board of Directors........................................................................................................... 22
6.3 Principal Advisors ........................................................................................................... 22
7.0 Operations.......................................................................................................................... 23
7.1 Location .......................................................................................................................... 23
7.2 Capital Equipment Requirements ................................................................................... 23
7.3 Labour Requirements ..................................................................................................... 23
7.4 Sources of Supply .......................................................................................................... 24
7.5 Production Process ........................................................................................................ 24
8.0 Implementation Schedule ................................................................................................... 26
8.1 Overall Schedule with Timelines ..................................................................................... 26
8.2 Potential Problems to achieving Deadlines ..................................................................... 28
9.0 Financial ............................................................................................................................. 29
9.1 Type and Amount of Financing Required ........................................................................ 29
9.2 Pro-forma Income Statement .......................................................................................... 30
9.3 Pro-forma Cash Flow Statement ..................................................................................... 31
Great Canadian Gaming Corporation Page 2 of 35
3. 9.4 Pro-forma Balance Sheet ............................................................................................... 32
10.0 Key Risks ......................................................................................................................... 34
10.1 External Environment Risks .......................................................................................... 34
10.2 Internal Environment Risks ........................................................................................... 34
10.3 Marketing Risks ............................................................................................................ 34
10.4 Human Resource Risks ................................................................................................ 34
11.0 Contingency Plans............................................................................................................ 35
11.1 Contingency Plan if Objectives not met......................................................................... 35
11.2 Contingency Plan if Objectives Exceeded..................................................................... 35
Great Canadian Gaming Corporation Page 3 of 35
4. Executive Summary
Introduction
Great Canadian Gaming Corporation is a multi-jurisdictional gaming and entertainment
operator, which has successfully operated in locations across Canada and Washington State for
the past 20 years. The Company has seen its most growth in the past 10 years, surpassing
$400 million for the first time in 2008.
River Rock Casino Resort is the company’s flagship location and its sales for the third quarter of
2010 has increased by $3.7 million, when compared to the third quarter of last year. With this
location seeing an increase of 15,000 people each week with the recent completion of the
Canada Line Skytrain in Richmond, BC, Great Canadian is planning to improve customer visits
by leveraging the quality and quantity of shows offered at its 950-seat show theatre.
The Market
This business plan will outline the goals and strategies to generate an increase in River Rock
customer visits for the 25-35 age demographic, which makes up approximately 28% of its
market. This target is seen as attainable through the planned quality of the upcoming
entertainment, and a growing reputation of the show theatre over the preceding years. The total
size of this market in the Lower Mainland is approximately 181,860 people.
Financial Considerations
The Company is seeking to obtain loan financing for the amount of $500,000. This loan amount
is expected to be repaid within 8 months and will produce a 112% ROI over a three year period.
The following is the sales, expenses and profits for the show theatre sales.
2012 2013 2014
SALES $2.07M $3.62M $4.50M
EXPENSES $1.74M $3.37M $4.00M
PROFIT $0.33M $0.25M $0.50M
This target is seen as attainable through the planned quality of the upcoming entertainment, and
a growing reputation of the show theatre over the preceding years. This business plan will
discuss the tactics and strategies to generate a significant increase in River Rock visits from its
show theatre entertainment and implement a successful transition to a stronger entertainment
destination in the Lower Mainland.
Great Canadian Gaming Corporation Page 4 of 35
5. 1.0 Business of the Company
1.1 Business Summary & History
Great Canadian Gaming Corporation (Great Canadian) is a multi-jurisdictional gaming and
entertainment operator. The company operates in British Columbia, Ontario, Nova Scotia,
Canada and Washington State in the US. The Company operates ten casinos, a thoroughbred
racetrack that offers slot machines, four standard bred racetracks, a hotel and conference
centre, two show theatres, a community gaming centre, a bingo hall and various food and
beverage and entertainment facilities. In Canada, it operates its casinos in managed markets
with barriers to entry and under long-term agreements as partners with provincial lottery
corporations. (Great Canadian Gaming Corporation, 2009)
Great Canadian has been in business for approximately 30 years and the company's growth
has taken place in the last ten years. The Company began operating temporary charity casinos
in various locations in 1982, had expanded its operations in British Columbia by 1997 and in
1998 the charity casino system was replaced by government management and the British
Columbia Lottery Corporation assumed oversight of all casinos in the province. Great Canadian
listed its shares on Toronto Stock Exchange in 2004. The Company is headquartered in
Richmond, British Columbia and employs approximately 4,500 people. (Great Canadian Gaming
Corporation, 2009)
1.2 Industry Overview
Major participants in the world gaming industry are:
Harrah’s Entertainment, Inc.
Harrah’s Entertainment is a privately owned company that owns, operates, or manages 52
casinos in 7 countries comprising the U.S., England, Scotland, Canada, Uruguay, Egypt, and
South Africa. Its facilities had an aggregate of approximately 3 million square feet of gaming
space and approximately 39,000 hotel rooms. The company was founded in 1937 and is based
in Las Vegas, Nevada.Its casino entertainment facilities include land-based casinos, riverboat or
dockside casinos, managed casinos, combination greyhound racetrack and casino, combination
thoroughbred racetrack and casino, and harness racetrack and casino, as well as hotel and
convention space, restaurants, and non-gaming entertainment facilities. The company’s
properties operate primarily under the Harrah’s, Caesars, and Horseshoe brand names. It also
owns the World Series of Poker tournament and brand. Harrah’s 2009 revenues and net income
respectively were $8,9074 Billion and $827.6 Million. (Bloomberg Businessweek, 2010)
Great Canadian Gaming Corporation Page 5 of 35
6. MGM Resorts International
MGM Resorts International is a publicly traded company that owns casinos in 3 countries.
MGM owns 17 casinos in the US, six of these in Las Vegas as well as one casino in China.
MGM also owns hotel properties in Dubai. Their 2009 revenues and net loss respectively were
$5.979 Billion and -$1.292 Billion. (MGM Resorts International, 2010)
Las Vegas Sands Corp.
Las Vegas Sands Corp is a publicly traded company that owns eight casinos in three countries.
Of the US properties, three are in Las Vegas, and one property is in Pennsylvania. Three of the
remaining properties are in China, and the last was recently opened in Singapore as of April
2010. Their 2009 revenues and net loss respectively were $4.929 Billion and -$368.7 Million.
(Las Vegas Sands Corp., 2010)
Penn National Gaming, Inc.
Penn National Gaming owns 24 casinos in total. In the US, Penn National has 15 casinos, four
racetracks with slot machines, seven horse racetracks, and five locations for off track wagering.
Penn National also has one casino in Ontario, Canada. Their 2009 revenues and net loss
respectively were $2.369 Billion and -$267.4 Million. (Penn National Gaming, Inc., 2010)
Ameristar Casinos, Inc.
Ameristar is publicly traded and owns seven casinos in the US. Their 2009 revenues and net
loss respectively were $1.215 Billion and -$4.667 Million. (Ameristar Casinos, Inc., 2010)
Boyd Gaming Corporation
Boyd Gaming is publicly traded and owns 15 Casinos in the US. Seven of the casinos are
located in Las Vegas, two in Atlantic City, one in Illinois, one in Indiana, three in Louisiana, and
one in Mississippi. Their 2009 revenues and net income respectively were $990.6 Million and
$108.2 Million. (Boyd Gaming Corporation, 2010)
The gaming industry in Canada is composed of sales from betting and gaming forms such as
bingo, lottery, pari-mutuel (horse racing), and slots and from casino table game activities
(excluding online activities).
Canadian Gaming Industry
The gaming industry in Canada is composed of sales from betting and gaming forms such as
bingo, lottery, pari-mutuel (horse racing), and slots and from casino table game activities
(excluding online activities).
The Canadian Gaming Industry is a 15.34 billion dollar industry, which has grown by 50% over
the past 10 years.
Great Canadian operates in the provinces of British Columbia, Ontario and Nova Scotia, which
account for 13%, 35.7% and 2.6% of the Canadian Gaming Industry respectively in 2009. (HLT
Advisory Inc., Canadian Gaming Industry Overview, July 2010).
Great Canadian Gaming Corporation Page 6 of 35
7. 1.3 Current Situation of the Company
The Great Canadian Gaming Corporation has seen strong revenues of $382.2 million in 2009.
This is substantial growth since 2000, where revenues were $54.3 million. Revenues in 2008
were $403.7 million and 2009 was the first time in the past 10 years that revenues have
declined. The Great Canadian Gaming Corporation sees a steady increase in quarterly
revenues with the first quarter starting in January being the lowest in revenues and the last
quarter ending in December having the highest revenues.
This economic slowdown for the company in 2009 has caused a reduction in revenues and so
The Great Canadian Gaming Corporation had to “take a conservative approach toward capital
deployment. Certain projects have been deferred, and revised timelines for their development
will not be issued until greater clarity is available around future market conditions.” (Corporation,
2010)
Currently the revenues for the first six months of 2010 are $190 million, which is on track to
mirror 2009. The first six months of 2009 had revenue of $189.9 million with table games and
slot machines generating 27% and 42% of revenue respectively. Revenues at River Rock
Casino Resort for the first three quarters of 2010 increased by $3.7 million from 2009. (Digital
Journal, 2010)
The Great Canadian Gaming Corporation will be adding additional rooms to the River Rock
hotel. “The Company will be adding additional rooms to the Rock Rock’s hotel. “This five-storey
tower will add 193 rooms to River Rock's hotel capacity, and create an additional driver for both
hospitality and gaming volumes at the property. We anticipate opening this tower during the
fourth quarter of 2011, and that completing its construction will require further costs of
approximately $26.0 million.”Ross J. Mcleod,http://www.digitaljournal.com/pr/159207#ixzz15gV8msHx,
November 10,2010
1.4 Goals and Objectives
The Great Canadian Gaming Corporations goal is to increase the amount of visitors for 2010 at
the River Rock Casino.
The objective is to obtain a loan of $500,000 from a financial institution to bring in high profile
and local comedians and musicians to increase the amount of visitors of a younger
demographic by 10% (Statistics Canada, Perspectives on Labour and Income, Gambling, July
2009). With many newly renovated or newly built facilities The Great Canadian Gaming
Corporation can use these new expanded facilities to increase the number of visitors aged 25-
35. The variety of entertainment will be targeted to a younger demographic with current,trendy
acts being featured. A greater amount of advertising will be featured to inform the public of the
new current entertainment.
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8. The 25-35 age demographic accounts for approximately 28% of the gambling demographic.
(Statistics Canada. Perspectives on Labour and Income, Gambling, July 2009.)
This accounts for $28.8M of Great Gaming’s annual sales of $102.9M (2009 annual gross
sales).
Therefore a $3M increase in sales results in a 10% increase in total River Rock sales derived
from the 25-35 aged demographic.
1.5 Key Success Factors
The Great Canadian Gaming Corporations key success factor has been the lack of competition.
This is due to the fact that Crown corporations responsible for gaming have taken steps to limit
the amount of gaming facilities in Canada. Key success factors for the future will be to increase
the diversity of the entertainment that The Great Canadian Gaming Corporation provides to
attract a larger range of demographics.
1.6 Structure of the Company
The Great Canadian Gaming Corporation is a Corporation and is publicly traded on the Toronto
stock exchange. Ross J. McLeod is the CEO with 30 years of experience in the hospitality
industry. Ron N. Baker is the newly appointed President as of May 2010. Milton Woensdregt is
the Chief Financial Officer with 27 years of senior accounting and management experience.
Earnest C. Beaudin is the Lead Director and Joanna Brierley is the Secretary of the Executive
Board.
Great Canadian Gaming Corporation Page 8 of 35
9. 2.0 Product / Service Description
2.1 Detailed Description of Product/Service
The services River Rock Casino through their River Rock Show Theatre are concerts and
shows with the use of their River Rock Show Theatre. River Rock will reach out to numerous
music artists and comedians and book them to perform at their theatre. The theatre is 21,000sq
ft and can seat 950 people and River Rock is focusing on bringing in music acts that are either
local, established or starting to make a name for themselves.
The comedic acts will be well known and have done shows in throughout North America and the
rest of the world.
The company will book music and comedy artists such as examples listed below.
Music Artists Comedians
Bruno Mars Margaret Cho
Aegis Fang Anjelah Johnson
Brandon Flowers Russell Peters
Far East Movement Aziz Ansari
Ivana Santilli Chelsea Handler
Great Canadian offers gambling and gaming services through the following operations: ten
casinos, a thoroughbred racetrack (with slot machines), three standard bred racetracks (two
offer slot machines and one offers both slot machines and table games). They also have two
show theatres, a community gaming centre, a hotel & conference centre, a bingo hall, and
various associated food and beverage and entertainment facilities.
2.2 Stage of Development of Product / Service
The development of the theatre location is a finished product. The River Rock Show Theatre is
a 21,000 square foot entertainment venue that features a state of the art seating system that
can transform the theatre into different layouts such as a convention/meeting room.
River Rock will be booking more acts to increase the usage of the theatre. As more customers
come to the theatre due to the performer, more awareness will be developed leading to a better
overall impression of River Rock.
Great Canadian Gaming Corporation Page 9 of 35
10. 2.3 Certification and Regulatory Standards Required
Each province has a Crown Corporation in charge of gaming and regulating the industry. The
Great Canadian Gaming Corporation also operates in Washington where the industry is
regulated by the Washington State Gambling Commission.
British Columbia has the British Columbia Lottery Corporation which conducts and manages
lotteries, casinos and commercial bingo halls. It oversees all gaming services providers and
gaming workers, B.C.'s horse racing industry and licensed gaming events. The Branch also
manages responsible gambling programs and manages the distribution of gaming funds
received by organizations. (BCLC, 2010)
Ontario is governed by the Ontario Lotto and Gaming Corporation (OLG, 2010) manages
lotteries, casinos, and horse racing. Nova Scotia is regulated by the Nova Scotia Alcohol
which manages alcohol and gaming licenses in the province. (Province of Nova Scotia, 2010)
2.4 Customer Benefits Provided by Product/Service
Great Gaming Casino’s flagship location, River Rock Casino, currently offers a high level of
convenience to its market with free parking and Canada Line Skytrain transportation access.
With the requested raising of $500,000 Great Canadian will offer an increase in quality and
frequency in its show theatre entertainment for the younger demographics of men and women
aged 25-35.
Show Services
These shows will provide high levels of “newness”, excitement and entertainment to this market
through celebrity and current popular musicians and comedians. It will offer new improved
shows that this venue has never offered and an increase in frequency of its popular
entertainment. The Company will sell an attractive package with its show theatre tickets,
coupling it with slot machine credit and a free drink. This will encourage show participants to
enter the other areas of the casino after each show and purchase gambling services.
Gambling Services
River Rock Casino offers some of the most modern, quality gambling products such as slot
machines, card games, food and drinks and service in the Lower Mainland. The November 19,
2009 completion of various upgrades at the facility has lead to an extensive slate of
enhancements. Despite the weakened economy, these redevelopments combined to generate
significant improvements in visitation, table drop, and slot coin-in at the facility during the fourth
quarter of 2009. (Annual report, 2009)
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11. 3.0 Market Analysis
3.1 Target Market Profile
Primary Market
New shows intended to attract younger demographics. Currently shows are geared towards an
older demographic with a list of current shows including “Retro Rock, Orient Expressione, and
Kenny Rogers” (Rock, 2010).
River Rock will be going after a local younger demographic of men and women aged 25-34 with
the new list of performers. The geographic reach of River Rock Casino is larger than other
casinos due to its unique location, situated right at a skytrain station allowing for easier
transportation than any other show theatre or casino in the lower mainland.
The psychographic of the target market is that they have an interest in new current music and
standup comedy, as well as they do not see a casino in a negative manner. There are many
other entertainment options available to the target audience and a large marketing campaign
and well known celebrities will be used at the beginning of the target market shift to get the
audience to become interested enough to purchase.
3.2 Total Market Size
“The 21-to-40 gambling crowd has become a growing, lucrative market that will grow even
stronger with the right attention.”
Dennis Conrad, Associates, R. K. (2010). Casinos gaming and wagering. Harrah's Entertainment, Casino
Journal.
This market is growing with 71% of casino executives participating in a survey conducted for a
recent industry trade show say they expect resorts to redesign themselves with young patrons
in mind. (Associates, 2010)
Currently the age range of 25-44 accounts for 33% of the population in the Lower Mainland
based on 2006 census data accounting for a total of 379,541 people. From 2001 to 2006 the
population of the lower mainland increased their casino spending from $198 per household to
$239 per household. It is becoming more socially acceptable to go to a casino in the lower
mainland, and based on a survey done by Harris interactive 40% of Americans are planning on
attending an entertainment activity or show at a casino in the next 12 months.
Goodwin, T. (2006, 07 07). Statistics from extensive casino gambling poll. Retrieved from Casino
Gambling Web: http://www.casinogamblingweb.com/gambling-news/casino-
gambling/statistics_from_extensive_casino_gambling_poll_released.html
Great Canadian Gaming Corporation Page 11 of 35
12. 3.3 Trends
Increase in Traffic Due To Canada Skytrain
As part of a $30 million Canada Line Skytrain renovation in Vancouver, gamblers and other
visitors can now gain easy access to River Rock Casino off at the Canada Line's Bridgeport
Station and walk directly to the casino via a new covered walkway to the resort's third floor.
Once in the resort, customers take the spiral escalator that drops them on the doorstep of
dozens of slot machines and gaming tables.
This Canada Line access has provided River Rock Casino with an extra 15,000 extra customers
each with and a 15% increase in guests. Management has reported that the majority of their
guests now come from the Canada Line. These guests include older demographics from
Oakridge, Kerrisdale, Yaletown and younger crowd as they can drink and not have to drive. The
increased drinking and driving restrictions in British Columbia could also encourage a further
increase in traffic to the casino. (Morton, 2009)
Entertainment at Casinos
In a 2006 poll, among those who say they are at least somewhat likely to visit a casino in the
next 12 months (49%), 40 percent are planning on attending an entertainment activity/show.
The poll also showed that people are seeking for more of an entertainment experience when
visiting a casino to gamble. (Goodwin, 2006)
Socioeconomic trend
Currently there is a decline in younger gamblers as the number of gamblers aged 19-34 has
decreased from 57% (1992) to 42% (2008). River Rock Casino hopes to capture this declining
demographic with an increase in quality music and comedy entertainment.
(SOURCE: Statistics Canada. Perspectives on Labour and Income, Gambling, July 2009.)
3.4 Estimated Company Sales and Market Share
To forecast the three years of sales in theatre tickets sold, River Rock will assume that during
the first year they will be selling 60% of seats available, 75% for the second, and 90% for the
third year for their normal shows. As for the high profile shows, 10% of the seats will be
reserved for VIP tickets and 90% for regular price.
The goal is to have a show every weekend (Friday, Saturday, and Sunday), and start off with
having two high profile performers in year one and increase by two every year. Each high profile
file performance will consist of three concerts.
The table below shows the expected sales and shows.
Great Canadian Gaming Corporation Page 12 of 35
13. Year 1 Year 2 Year 3
# of # of # of
Concert Concert Concert
s Sales s Sales s Sales
$
High $ $ 1,254,326.1
Profile 6 627,163.08 9 940,744.63 12 7
Norma $ $
l $ 2,678,079.6 3,213,695.6
Shows 35 714,154.58 105 9 105 3
$ $ $
1,341,317.6 3,618,824.3 4,468,021.7
Totals 7 1 9
3.5 Rules of Purchase
River Rock Casino customers require the live shows to appeal to their demographic, and must
perceive gambling after the events to be desirable and socially acceptable. They require easily
accessible and affordable parking, with the casino being within 30-60 minutes driving distance.
Customers who choose to gamble must also perceive their odds of winning to be fair
(BC Responsible Gaming)
Great Canadian Gaming Corporation Page 13 of 35
14. 4.0 Competition
4.1 Direct Competitors – Present and Future
Present Competitors
Other live entertainment venues with shows on the weekends such as the Orpheum, Queen
Elizabeth Theatre, and the Vogue Theatre would be in direct competition with the River Rock
Show Theatre. All of these theatres are located in downtown Vancouver with seating capacities
ranging from around 1,000-2,900.
The Orpheum has 2,780 seats and positions itself through a variety of shows. It showcases the
Vancouver Symphony, Opera, rock concerts, and stand-up comedians.
The Queen Elizabeth Theatre has 2,781 seats and positions itself by showcasing ballet, opera,
orchestra, and theatre productions at its venue.
The Vogue Theatre has 1,144 seats and positions itself through having rock performances such
as The Trews and Bedouin Soundclash. Stand-up comedians such as Bob Saget, and local
bands perform at the Vogue.
Other gambling facilities in the Lower Mainland are in direct competition with River Rock such
as Edgewater Casino located in downtown Vancouver. The Edgewater Casino has a 430 seat
show theatre that is positioned mainly towards video events with an 18ft tall high definition
projection screen and a state of the art surround sound system.
The Grand Villa Casino located in Burnaby has a restaurant lounge area with a big screen
television for watching sporting events.
The Starlight Casino located in New Westminster has a sports bar with 120 video screens which
attract customers to watch sporting events.
Cascades Casino located in Langley has a 420 seat theatre with large high definition video
screens for sporting events. Live performances mainly consist of jazz, blues, and R&B.
Future Competitor
There is a casino planned for downtown construction to replace the Edgewater Casino and be
three times the size. It is currently expected to be finished by 2013. This new casino has yet to
be named and is going to be positioned as a Vegas style destination casino. (Rockel, 2010)
Great Canadian Gaming Corporation Page 14 of 35
15. 4.2 Indirect Competitors – Present and Future
Online Gambling
The online gaming industry has grown from $87M (2002) to $4.7B (2010). By 2014 online
gambling is expected to grow to over US$7B. Examples include online poker, etc. ( iGaming
Business)
Clubs and Smaller Venues
Many acts prefer this medium since it costs less and there is not as much set up costs. The
artist can do a shorter show and tickets are usually cheaper than going to an actual theatre for
the customer.
YouTube and Video Upload Sites
Almost anything can be found on the Internet and many people will wait for a concert or show to
be uploaded online rather than pay to watch. A lot of previous shows of the artist or comedian
will be posted on YouTube so only loyal fans will pay to watch their shows.
DVD’s and Blu-Ray
Many artists and acts have their concerts come out in these mediums. Rather than pay a higher
price for a ticket, customers will wait for a DVD or Blu-Ray to come out than go to a concert
where they it may be too noisy or the crowd can have unexpected behavior. With Blu-Ray
quality, it can be almost as if you’re at a concert.
4.3 Substitute Products or Services
For the casinos and gaming sector as a whole, almost any leisure activity can act as a
substitute, which can be taken up with minimal switching costs and may also be cheaper than
gaming for consumers. Aside from cost advantages, some customers may value social aspects
of using non-gambling forms of gaming facilities. The threat of substitutes in this sector is
strong. (Source: Datamonitor, United States - Casinos & Gaming, March 2010)
4.4 Competitive Edge
River Rock Casino’s floor is open 24 hours a day and 7 days a week. Theatre shows are more
intimate with a smaller theatre when compared to large venues such as Rogers Arena, and The
Pacific Coliseum. River Rock Casino has the largest show theatre out of all the casinos in the
lower mainland allowing them to attract larger performers.
River Rock is able to give value for the consumer due to the lower ticket price when compared
to similar sized venues since the majority of the casino’s revenues come from slots machines
and table games. This allows the casino to reduce the ticket price to bring in more consumers
to use its gambling facilities enticing them with a free $5 gaming chip with the purchase of a
theatre ticket.
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16. Any new company attempting to enter this sector would require large amount of capital to set up
a casino, employ staff and acquire gaming equipment. However, the willingness of customers to
switch from one gaming company to another and easy access to suppliers are conductive to the
entry of new players. The likelihood of new entrants to this sector is assessed as a moderate
overall. Datamonitor. (2010). Great Canadian Gaming Corporation. New York: Datamonitor.
The strong barriers to entry to the gaming industry in Canada have assisted in the growth of
Great Canadian Gaming Corporation due to reduced competition. (Corporation, 2010)
4.5 Competitive Analysis Chart
Comparing casinos that compete with River Rock that also have show theatres.
Edgewater Casino River Rock Cascades Casino
Show theatre 430 950 seats 420
# Hotel Rooms 0 220 (193 more to be 77
added end of 2011)
Restaurants 2 5 3
Gaming space 30,000sq ft 70,000sq ft 50,000sq ft
Parking spaces Underground valet 1,200 spaces in a Large outside
available parking large multilevel patrolled parking area
structure
Ease of Access Drive or two block Drive or casino is Must drive or bus
walk from Stadium located at Bridgeport with one bus route to
skytrain station skytrain station on the location
the Canada line
Pool N/A Yes N/A
The River Rock Casino has the largest show theater when compared to its main casino
competitors. The River Rock Casino has the highest amount of amenities and largest gaming
space for patrons to utilize after viewing a performance.
Great Canadian Gaming Corporation Page 16 of 35
17. 5.0 Marketing Strategy
5.1 Positioning
River Rock offers competitively priced, high quality musical and comedy performances as a pull
strategy to attract the 25-35 aged market in Lower Mainland. They offer a wide variety of
additional services for its clients to enjoy including food, drinks and gambling. River Rock also
encourages the use of these services by offering a free alcoholic drink and slot or table game
credit with the show ticket.
The customers will perceive the theatre’s entertainment as high quality and relatively
comparable to shows offered downtown as an example, yet at a lower price. River Rock is
positioned as one of the most high class gambling establishment in the Lower Mainland. This is
reinforced with the company’s recent upgrades to the facility and focus on high quality service.
Great Canadian Gaming Corporation Page 17 of 35
18. 5.2 Sales Strategy and Tactics
The success of this marketing strategy is reliant on advertising and promotion efforts, which will
be discussed in detail in the following section.
5.3 Advertising and Promotion Plans
The primary strategy is to use the show theatre to bring in more guests onto the casino floor by
adding incentives such as free drinks and a $10.00 credit that can be used for table games or
slot machines with every ticket purchased. These tickets must be redeemed on the same date
of the performance.
Sales Promotion
In order to bring more guests onto the casino floor, River Rock Show Theatre will be including a
free drink and free credits for the slot machines or table games. At the end of every
performance, the performer will remind the guests to use their free drinks and credits that come
with the ticket and encourage them to continue their night at the casino. This reminder at the
end of each performance will be included in each performer’s contract.
Social Media
River Rock will be using social media to promote the new shows they are presenting through
the means of Facebook and Twitter. These pages will display information about what kind of
shows are up coming and when they will be presented. On these pages there will also be
information about “What to do after the show” that will explain with each ticket purchase they will
receive a free drink, and a $10.00 credit that can be used for either table games or slot
machines.
Newspaper
River Rock will promote their upcoming shows with advertisements in the local daily Metro
Vancouver newspapers, 24, and the Georgia Straight, which have a combined readership of
95,800. The advertisements will feature the date of the show, details of the sales promotion
included with the show, as well as a call to action to both where the ticket can be bought and the
casino website. (Advertise. (2010, September). Retrieved from Metro Vancouver:
http://www.metronews.ca/vancouver/advertise)
(Straight Facts. (2010). Retrieved from Georgia Straight: http://www.straight.com/straightfacts)
Newspaper advertisements will run every day for a week before the show, from Monday to
Friday. The advertisements will be a 40 line banner in each newspaper. This will total to a
monthly cost of $11,720 for promoting Class A performances and a cost of $5,860 per month for
promoting class B performances.Metro Vancouver, 24 Hours (Vancouver), and Georgia Straight.
(2010, January 1). Retrieved from Card Online: http://cardonline.ca/
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19. Transit
River Rock will be using transit advertisements to promote their upcoming shows through both
sky train station advertisements as well as in-train banners. There will be 15 advertisements
each of vertical and interior cards and platform poster advertisements at 8 Class A Skytrain
stations. The Class A Skytrain stations include Burrard, Granville, Broadway and Metrotown, all
of which have high foot traffic, and will therefore generate the most awareness for the shows.
Each interior card will cost $41, vertical cards will cost $109, and platform posters will cost $616
and will cycle for the 4 weeks prior to the show.Translink. (2010). Products and Rates. Retrieved
from Vancouver Transit Advertisment:
http://www.vancouvertransitadvertising.com/dev/wordpress/products-and-rates/
5.4 Advertising and Promotion Calendar
Strategy Tactic / Vehicle Description Why Useful? Timing
Facebook Run update on Facilitates the Daily twitter
Twitter Twitter and artist’s current updates, regular,
Social Media Facebook daily. method of weekly
promotion Facebook pasts.
Beginning April
2012
Metro Vancouver There will be There will be These
Vancouver 24 banner ads Metro and 24 advertisement
Georgia Straight placed that will newspapers that will be starting in
promote the up- are distributed April 2012
Newspaper coming on the sky train
performances, in that will have a
the very large reach.
entertainment
section.
In performers Each performer This will add an At the end of
contracts will end their incentive to visit every
Sales show by the casino floor performance.
Promotion advising the after the
audience to visit performance
the casino floor
Advertising at 8 Posters River Rock Starting in April
stations and 30 in displaying the Casino is 2012 with double
Transit train poster ads upcoming shows located on the promotions
Advertising at River Rock Canada line before class A
route performances
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20. The first show will be May 6, 2012, and will act as a premiere for River Rock’s new upgraded
show theatre. There will be two large performers in Year 1 (May 6, 2012 - May 2013), the first
one being May 6, 2012. Each large performer will do three shows. In addition to these special
shows, River Rock’s show theatre will feature 1-2 shows per week of trendy local musicians or
comedians which are popular with the 25-35 age demographic.
In Year 2 River Rock plans to increase its number of special celebrity performers to three, and
four performers in Year 3. The special shows will feature a celebrity musician or comedian such
as Chris Rock.
5.5 Pricing Strategy
The pricing strategy that River Rock Show Theatre will be using will be a competition based.
Prices will be set lower than the competitors because River Rock will be trying to attract the
audience to the casino floors after each show. The price for low profile tickets will average
around $35.00, high profile performers will average around $75.00 and VIP will be priced higher
at $440.00 a ticket.
5.6 Channels of Distribution
To attend River Rock’s shows and concerts, the targeted customers will have to purchase
tickets. River Rock uses Ticketmaster for all their shows at the theatre so that will not change for
the new acts that they will be bringing in as mentioned in section 2.1 of the business plan.
Customers can purchase tickets at a physical Ticketmaster store or online at
www.ticketmaster.ca and print out a paper copy of the ticket. It’s the same thing as an actual
ticket with the seat number, authenticity bar code, name of the concert or artist and time and
place of the event. Being able to print it is for the convenience of the customer if they do not
have the time to go to a physical store.
5.7 Public Relations and Publicity Plan
The River Rock Casino will keep investors informed through bimonthly newsletters which will
highlight upcoming shows, expected profits and traffic as well as success points from past
shows.
The publicity for these shows will be done through articles in the entertainment section of local
Metro Vancouver newspapers. These articles will profile local artists and their upcoming show
dates at the River Rock theatre.
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21. 6.0 The Management Team
6.1 Key Management Team Profiles, Qualifications, and Responsibilities
The following are the profiles of the Key Management Team, along with their qualifications, and
responsibilities sourced from the Great Canadian Gaming Corporation website.
Director Executive Chairman, Chief Executive Officer - Great Canadian Gaming
Corporation
Ross J. McLeod
Ross J. McLeod has over 30 years of experience in the hospitality industry and served as a
Divisional Director of Operations for the Pacific National Exhibition. An acknowledged expert in
community charity gaming and a respected and major contributor to British Columbia's current
regulatory framework for casino gaming, Mr. McLeod is responsible for the evolution of the
charitable gaming industry in British Columbia. In 1999, Mr. McLeod was recognized by his
peers for his industry leadership and awarded Canada's most prestigious gaming award, the
Outstanding Contribution to the Canadian Gaming Industry Award.
Ross J. McLeod. (2009). Retrieved from Great Canadian Gaming Corporation:
http://www.greatcanadiancasinos.com/overview/governance/ross_mcleod.aspx
Director, President
Great Canadian Gaming Corporation
Rod N. Baker
Mr. Baker is the President of Great Canadian, a position he has occupied since March of 2010.
Prior to assuming this role, Mr. Baker served as a consultant to the company from June of 2008.
In his capacity as a consultant, Mr. Baker was responsible for developing and implementing the
efficiency improvement initiatives that allowed Great Canadian to remain both profitable and
competitive during the global economic recession. Prior to joining Great Canadian, Mr. Baker
worked in the field of merchant banking, both managing and investing in private and public
companies throughout North America. Mr. Baker’s background also includes various roles with
several large Canadian based investment dealers.
Rod N. Baker. (2009). Retrieved from Great Canadian Gaming Corporation:
http://www.greatcanadiancasinos.com/overview/governance/rod_baker.aspx
Lead Director
Great Canadian Gaming Corporation
Earnest C. Beaudin
A member of the Law Society of British Columbia, Mr. Beaudin was one of the founding partners
of the Vancouver law firm Alexander Holburn Beaudin & Lang. Mr. Beaudin left the firm and
private law practice in 1986 to become the President, Chief Executive Officer and General
Counsel of Decker Management Ltd. Decker Management Ltd.'s primary focus is healthcare
Great Canadian Gaming Corporation Page 21 of 35
22. issues while Decker Construction Ltd. is principally involved in residential development and
construction. Mr. Beaudin continues to hold the position of President and CEO of both divisions.
Earnest C. Beaudin. (2009). Retrieved from Great Canadian Gaming Corporation:
http://www.greatcanadiancasinos.com/overview/governance/earnest_beaudin.aspx
6.2 Board of Directors
The Board of Directors consists of Earnest C. Beaudin, Brian E. Egli, Larry Campbell, Peter
Meredith, Adrian R. Thomas, Ricahrd S. Buski, Thomas W. Gaffney, and David L. Prupas.
Directors and Officers. (2009). Retrieved from Great Canadian Gaming Corporation:
http://www.greatcanadiancasinos.com/overview/governance/
6.3 Principal Advisors
For booking talent, artists and comedians, River Rock will be affiliated with the following firms
and companies:
William Morris Endeavor Entertainment – http://www.wma.com
Creative Artists Agency - http://www.caa.com/
International Creative Management - http://icmtalent.com/
United Talent Agency - http://www.unitedtalent.com/
The agencies listed above are known as the “big four” who dominate the entertainment industry.
They have hundreds of agents globally, and own the rights to numerous mediums. These
agencies represent a large portion of the entertainment world, from television, commercials,
musicians and sports figures.
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23. 7.0 Operations
7.1 Location
River Rock Casino Resort is located on 8811 River Road Richmond, British Columbia. The
office space for the marketing and promotions employees for the show theatre will be set up at
the head office location at 350 - 13775 Commerce Parkway Richmond, British Columbia. This
will allow for ease of communication and transportation between the marketing managers and
River Rock staff.
7.2 Capital Equipment Requirements
Office Space
Office equipment is required for two new employees. The current office has phone and Internet
connection established; therefore the new employees only require computers and work space.
Theatre
Each artist requires different equipment to perform at the show theater. River Rock provides the
basic equipment for the venue. If an act has any special requirements for their show, they will
provide their own equipment to fulfill these needs.
7.3 Labour Requirements
Marketing
Two marketing managers will be hired to run the new marketing campaign for the show theatre.
These two employees will be experienced in creating and running a marketing campaign. Their
pay will be based on the industry average for a marketing coordinator with a starting salary of
$70,614 with bonuses and pay increases based on performance.
Pay scale. (2010). Pay scale Canada. Retrieved from Pay scale:
http://www.payscale.com/research/CA/Job=Marketing_Communications_Manager/Salary
The Show Theater
Increased staff will be required for the show theatre since it will be operating at a higher than
normal capacity and frequency. These staff will be part time and paid an hourly wage of $13 per
hour. The increased attendance of the show theatre during the weekends will require the hiring
of additional table staff or adding hours to the table game employees current schedule.
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24. 7.4 Sources of Supply
Ticketmaster – the show theatre tickets will be supplied from Ticketmaster. The prices for the
show will vary depending on the performer. In addition to ticket price there will be other costs
such as service charge, building facility charge, processing charge and shipping or e-ticket
convenience charge. Management will not be using any other ticket distributors other than
Ticketmaster. River Rock will track ticket sales to compare with promotion usage and casino
sales.
The “Big 4” talent agencies – William Morris Endeavor, Creative Artists Agency, International
Creative Management and United Talent Agency will be River Rock’s source for booking talent
and shows. River Rock chose the Big 4 as they are amongst the largest agencies in North
America and provide access to a wide variety of performers. The Big 4 are located globally and
prices vary depending on the talent, location, and amount of shows requested.
7.5 Production Process
Contact
Agency
Set-up and
Negotiations
show
Advertising
Talent Arrival and
Promotion
Contact Agency – River Rock’s marketing team will have a list of comedians and music acts
that they want to have performing at the theatre. The list will be separated with Class A and
Class B performers. Class A are celebrity-level performers that are more established or
command a higher fee or arrangements. Class B are performers that are on the rise or local
acts that have a steady, existing fan base. River Rock will contact the “Big 4” talent agencies to
book talent and see who’s available.
Negotiations – River Rock will contact the agent of the performer they want booked and ensure
the availability of the performer will coincide with the theatre’s schedule as to avoid conflicts.
Great Canadian Gaming Corporation Page 24 of 35
25. Cost of performer, accommodations, number of shows and length of shows will all be negotiated
and completed before the next step commences.
Advertising and Promotion – Once both parties have agreed on negotiations. River Rock and
the performer’s marketing team will devise an advertising and promotion plan. Costs and
magnitude of advertising will vary depending on the performer. River Rock will use social media
and newspaper and transit advertisements to promote upcoming shows. Tickets will be sold at
Ticketmaster outlets or on Ticketmaster.ca.
Talent Arrival – Once the performer and the agent arrives, River Rock Resort will provide
accommodations at the River Rock Casino Resort. The River Rock marketing team will discuss
with the performer on songs that they will perform on the night of the show and if it’s a comedian
then the topic of material they will perform.
Set Up and Show – River Rock staff will assist in theatre stage set up, according to the
performer. After a couple of practice rehearsals, the performance will begin later on that evening
or the next day.
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26. 8.0 Implementation Schedule
8.1 Overall Schedule with Timelines
The following will outline a general schedule for Class A and Class B music and comedy
performers at the River Rock show theatre venue. Each Class A performer is scheduled for
three consecutive shows. Each Class B performer is scheduled for two shows performing on
Friday and Saturday night.
In the case a performer cancels or is unable to perform, management will maintain a small
number of Class B performers able to step in on short notice. Shows will be scheduled such that
they avoid conflicts with large Vancouver events, such as playoff hockey games and large
concerts at Rogers Arena in order to maximize show attendance.
Each month The Company will raise awareness and create “buzz” through advertisement and
promotions one month in advance of upcoming shows.
April 2012
Advertise and promote upcoming entertainers for May 2012 and increase the quality and
quantity of shows at the River Rock’s show theatre venue.
May 2012
Class A: 3 shows
Class B: 6 shows
June 2012
Class A: 0 shows
Class B: 10 shows
(Two additional shows booked on Wednesdays)
July 2012
Class A: 3 shows
Class B: 9 shows
(Two additional shows booked on Wednesdays)
August 2012
Class A: 0 shows
Class B: 10 shows
(Two additional shows booked on Wednesdays)
September 2012
Class A: 0 shows
Class B: 9 shows
Great Canadian Gaming Corporation Page 26 of 35
27. October 2012
Class A: 0 shows
Class B: 9 shows
November 2012
Class A: 0 shows
Class B: 8 shows
December 2012
Class A: 0 shows
Class B: 10 shows
January 2013
Class A: 0 shows
Class B: 8 shows
Management performs casino-show theatre sales assessment
February 2013
Class A: 0 shows
Class B: 8 shows
March 2013
Class A: 0 shows
Class B: 10 shows
April 2013
Class A: 0 shows
Class B: 8 shows
Summary May 2012-April 2013
Total Shows Planned
Class A: 6
Class B: 105
Assessment
In September 2012 management will assess the use of gambling credits, increase in casino flow
and casino sales in comparison to show theatre attendance. If Year 1 show theatre strategy
proves profitable for casino, The Company will increase the number of Class A performers and
maintain the same number of total shows.
Year 2 and Year 3 Show Theatre Schedule
Year 2
-3 Class A performers (9 shows)
Great Canadian Gaming Corporation Page 27 of 35
28. -105 Class B performances
Year 3
-4 Class A performers (12 shows)
-105 Class B performances
8.2 Potential Problems to achieving Deadlines
The accuracy of the show theatre schedule could be affected primarily by Class A performer
cancellations. These cancellations could be due to factors such as illness or performer
scheduling conflicts. The Company plans to minimize these risks through binding contractual
agreement. A cancelled Class A performer act could offset negative word of mouth for the River
Rock show theatre. A second potential problem is the advanced booking time or the possibility
of changing performers. Management estimates an 8 month advance booking time-frame.
8.3 Milestones
January 2011
Obtain a $500,000 loan by September 1, 2011.
September 2011-April 2012
Book Year 1 schedule. Begin scheduling September 2011, will be completed by April 2012.
January 2012
8 month assessment of show theatre patron casino usage. January 2012
September 2012-April 2013
Book Year 2 schedule. Begin scheduling September 2012.
January 2013
20 month assessment January 2013
September 2013-April 2014
Book Year 3 schedule. Begin scheduling September 2013.
January 2014
28 month assessment January 2014
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29. 9.0 Financial
9.1 Type and Amount of Financing Required
Amount of Financing Required:
$500,000
The highest negative cumulative cash flow for the River Rock Show Theatre is the month of
December 2011, with a negative cumulative cash flow of $439,172. This represents the
maximum amount of financing the Show Theatre is expected to require. To compensate for the
possibility of underestimating financing requirements, a buffer of 13.9% will be included in the
total financing amount. This brings the amount of financing to $500,000.
Type of Financing:
The Show Theatre will use debt financing from a financial institution to meet the financing
requirement.
Financing Contingency Plan:
If returns are not seen as quickly as expected additional short term financing or line of credit will
be used.
Great Canadian Gaming Corporation Page 29 of 35
33. 9.5 Notes to Financial Statements and Important Financial Assumptions
Related Income statement and cash flow assumptions:
The class A artists are paid 50% when the artist is booked for the show and the remainder when
the artist performs. Class B artists are paid 25% of their expected ticket sales when booked and
the remaining 75% after the performance.
It is assumed that the class B acts draw 60% show theater capacity crowds in 2012. Projected
capacity for 2013 is 75% of show theatre capacity for class B shows, as well as a 90% show
theatre capacity for 2014.
All performers’ tickets go on sale 4 months prior to the show date.
Class A artists are expected to sell 100% of the tickets in the first month of the tickets being
offered.
Cash flow specific assumptions:
The class A artists are paid 85% of ticket revenue with 50% paid when the artist is booked and
the remainder when the artist performs. Class B artists are paid a total of 65% of ticket revenue
with 25% of their expected ticket sales when booked and the remaining 75% of their payment of
ticket sales after the performance.
Class A artists are expected to sell 100% of the tickets in the first month of being offered. Ticket
sales for class B artists are expected to have 50% of sales in the first month and the remaining
50% over the next 3 months with 10% in the second month of tickets offered, 10% in the third
month and 30% in the month of the performance. Ticket master forwards cash received from
the sales of the tickets within the same month of the ticket being sold.
Balance Sheet Assumptions:
Amortization for the theatre is straight-line method over 25 years.
Great Canadian Gaming Corporation Page 33 of 35
34. 10.0 Key Risks
10.1 External Environment Risks
- Terms of operational service agreements with lottery corporations
- Changes to gaming laws that may impact the Company’s operational service
agreements
- Pending, proposed or unanticipated regulatory or policy changes
Corporation, G. C. (2010). Annual report 2009. Richmond: Great Canadian Gaming Corporation.
- Cancellations of Class A entertainers due to health or other reasons
- Class A entertainers are unavailable for specific dates
10.2 Internal Environment Risks
- Unable to obtain key Class A entertainers that fit with the casino’s target market.
- Not a sufficient number of show attendees flow to casino proceeding shows
10.3 Marketing Risks
- The current marketing and promotions outlined in this plan does not create sufficient
awareness for shows consistently throughout the year
10.4 Human Resource Risks
Dependence on key personnel
Corporation, G. C. (2010). Annual report 2009. Richmond: Great Canadian Gaming Corporation.
RISK RESPONSE
Not a sufficient number of show attendees Track casino credit & free drink usage
flow to casino proceeding shows
Unable to obtain key Class A entertainers that Post-pone schedule until a suitable fit
fit with casino target market
Marketing and promotions not sufficient in Increase advertisement and promotions
creating show awareness spending and assess resulting casino
profitability
Great Canadian Gaming Corporation Page 34 of 35
35. 11.0 Contingency Plans
11.1 Contingency Plan if Objectives not met
If River Rock Doesn’t Reach Sufficiently Show Capacity
Spend more money and marketing efforts in increasing awareness and interest in the shows at
River Rock. Examples include radio contests or direct mail marketing towards target market.
If show attendees fail to move to casino following shows
Management will undergo close analysis between show demographics, gambling credit usage
and casino sales, and test various fan bases to determine which are most profitable for casino.
Potentially spend additional monies as well as write contractual agreements with the performers
which include celebrity appearance gambling after shows to encourage consumer involvement
on the gambling floor.
Execute direct marketing with past show attendees to market upcoming shows and create
repeat visits
11.2 Contingency Plan if Objectives Exceeded
If celebrity Class A performers create profits which exceed projections
-Management will adjust upcoming show schedules to increase the ratio of Class A performers.
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