The Sand Dollar Plays The Odds As Bar 702July 7, 2013 By: Kristen Santoro
You can’t make emotional decisions. You need to make practical decisions to success. – Jon Taffer
The Sand Dollar opened in 1976 as a gaming and blues bar two blocks off the strip in Las Vegas, NV. In the late 70’s blues music topped the charts and the bar quickly gained a famous reputation for hosting popular performers like Eric Clapton, Etta James and B.B. King. In 2006 blues music lost its audience and the once legendary Sand Dollar was forced to close.
Six years later single mom Lisa borrowed money from her friend Dr. Paul to try to resuscitate the dead bar. Lisa thought that by simply hosting blues bands she could restore the Sand Dollar to its former glory. The once lively crowds that frequented the bar and enjoyed the blues tunes are now in their mid-forties to early sixties and less likely to be spending nights out on the town.
Now the few locals that still pass through have no interest in the music or gambling. As the Sand Dollar continues to go under, Lisa, a 10% owner only makes money if the business profits and tries to bail it out by getting behind the bar on a daily basis.
To make matters worse co-owner Paul make the female customers uncomfortable and embarrasses them with his crude comments. Currently, the bar is five months away from playing its last riff.
Las Vegas, Nevada is known as the live entertainment capital of the world. It is home to 15 of the world’s 25 largest hotels and casinos. The businesses on the Las Vegas Strip rake in more than $14 billion per year and the 103,000 local hospitality professionals take home a fair share of the pie; making and estimated $90 thousand per year.
With unlimited gambling at their fingertips, slot machine play is the most popular and puts nearly $7 billion back into the Las Vegas economy. In a city where the house always wins, the legendary Sand Dollar should be claiming their fair share of the profits. Instead they are $300 thousand in the hole.
The 25 hundred square foot space with a music stage, two pool tables and a massive horseshoe bar with two speed wells and 14 video poker machines in the bar top, two blocks off the strip fails to cash in on both the local hospitality workers and the gamblers.
At a typical gaming bar the average table slot machine brings in between two and three thousand dollars a day. Therefore, the Sand Dollar should be running at about four to five percent of that, which makes each machine worth about 40 to 50 thousand a year in profits. With 14 machines it should average out to be about 500 to three quarters of a million a year.
A big problem with the Sand Dollars is that players didn’t like the schedule. The schedule determines the likelihood that a player will win each time they bet. Looser schedules mean that gamblers will win more frequently. While it appears that looser schedules will lead to losses by forcing the bar to pay out more, the improved payout schedule will actually entice gamblers to stay longer, drink more and come back again. The Sand Dollar needs to sweat the money and embrace the winners in order to start turning a bigger profit.
In addition to the gambling issues, only 3% of the population really calls blues their favorite music genera. B.B. King, himself, had a club down the street that closed. The music selection isn’t helping to attract the young local gamers that the bar needs.
The bar is also lit by florescent lighting; which is the kiss of death. Florescent lights blink quicker than the eye can see. That blinking fatigues the optic nerve and making you feel tired after a period of time, affecting the length of stay in the bar by 30 to 40 percent.
At her wits end owner Lisa decides that she doesn’t know as much as she thought and has decided to make the call for help.
The staff doesn’t respect their management and thinks that the only reason Lisa is taking shifts behind the bar is because she doesn’t believe that anyone else can handle it. Respect as a manager is something that is earned. It’s earned by holding your employees to perform better every day; you can’t be behind the bar all the time, you have got to be managing the place.
Jon Taffer knows that they will never be able to perform on an A level unless they clear the air. Therefore, he first meets with the entire team to discuss the issues. Then allows the team to speak amongst themselves in a “safe room” format where no stone is left unturned.
Once everyone understands the bad hand, Taffer brings in mixologist Jennifer Jakubowski. Jen has years of experience catering to hospitality employees in several prominent resident bars across the country. To help with the gaming issue, Taffer brings in Anthony Curtis, president of LasVegasAdvisor.com. Anthony has been a professional gambler for more than 15 years and has even been banded from casinos for frequently pulling in hundreds of thousands of dollars in a single sitting.
In order to bring the bartenders up to speed, Jen quizzes them on basic knowledge of simple cocktails that are ordered frequently on the Las Vegas Strip. During the stress test, Jen brings in a cow bell that she rings every time a bartender does something wrong and by the end of the night the inexperienced bartenders want to rip the bell from where it hangs.
In order to correct the problems the bartenders face they are taken to off sight training. Jen explains that they are one of the primary factors that influence and impact the guest experience. Time is money and they need to be as efficient as possible. The more efficient they are the more professional they look.
When it comes to the gambling the prime directive is to get players in seats quickly therefore you need to engage the customer. The game can’t make money if money isn’t going into it. Anthony and Taffer sit with Paul and Lisa to go over the schedules of the machines and make the strategic decision to loosen them; allowing them the chance to keep customers longer and compete with other local hangouts.
Taffer also needed to find a way to work around the fact that the bar doesn’t serve food. When a venue has a full service menu patrons gamble about 52 minutes longer. Therefore, Taffer and his team installed a window through to the Vietnamese restaurant next door. The restaurant put together three special food items that fit the bar and will stimulate gambling. Through a smart phone or tablet you can send the order directly to the restaurant and when ready they will put it in the window.
The fact is that there was a great history of the Sand Dollar and blues in the 70’s and early 80’s but do you think those people are still going out? No! Therefore, Jon Taffer and his team made the bar relevant to the local community by calling it Bar 702 (702 being the local area code). They also created a local Bar 702 mug shot area where guests can take pictures of themselves. This is a great opportunity for the bar’s viral marketing and social media campaigns.
Six weeks later, Lisa’s phone is ringing off the hook about local bands wanting to play at the bar. Even though Lisa and Paul were nervous about the increased pay back because they took a pretty big hit in the beginning they decided to trust Jon and Anthony’s decision. Now, people are sitting longer, playing more and the slot machines are beginning to turning a profit. The drop from the video poker has increased by 33 percent and Bar 702 has the loosest gambling machines in Las Vegas.
Lisa has been out from behind the bar and transformed into a manager, delegating tasks to staff members. They are finally on the road to success.