Reaching the pinnacle of the land-based casino market is a different challenge compared to ascending to the top of the online casino market. Because people attend land-based casinos in person, there are many more factors to consider when creating a VIP experience for high-rollers, from visual aesthetics and furnishings to lavish refreshments and quality of service.
The Ritz Carlton is featuring heavily in London newspaper headlines because of tis financial struggles. However, those struggles are nothing to do with the luxurious casino’s approach to doing business. In fact, the casino managed to increase its revenue of late. So, where does the problem lie? Well, that would be with the VIP players who have racked up millions of pounds worth of debt.
VIPs Fail to Pay Back Millions
For this story, service is the word to consider. That is because land-based casinos like the Ritz have to work harder to foster loyalty, as personal communication and contact are part of what VIP high-rollers will value. To that end, all high-end casinos will offer a line of credit to their high-rollers, which basically means that they pay off any losses at a later date.
Financially, the Ritz Casino recently revealed that it had made an operating loss of close to £12.5 million in 2013, and that was in spite of generating profit of £9.6 million. The owners of the casino are Sir David and Sir Frederick Barclay, both of whom are billionaires. Now they appear to have lost patience, as the twin brothers have initiated legal action against 10 VIP players who have not cleared their debts.
Comparatively, just two VIP players were taken to court over debts in the past two years. One of the more recent offenders was Bharat Kalwani, a billionaire who made his fortune in the Singapore property and construction industries. After gambling millions in October 2013, he gave the Ritz a £5 million cheque that he knew would not clear. A settlement was eventually reached.
Nora Al-Daher is another previous offender, who accrued £2 million worth of gambling losses while playing at the Ritz in April 2012. She tried to fight the debt by arguing in court that she had a gambling addiction and that the casino should not have extended credit. However, the judge ruled that she possessed ‘unimaginable wealth’ and forced her to pay up.
VIP Presence Vital to Casinos
When analysing the recent financial struggles of the gambling industries in Las Vegas and Macau, it was immediately apparent that revenue from high-rollers had declined by millions of dollars. So much so that major media outlets the world over have been reporting the news.
The fact of the matter is that casinos like the Ritz have to extend credit if they want to attract VIP players. However, initiating legal proceedings against 10 high-rollers could harm the casino’s VIP image. Understandably, there will be select cases like the two highlighted above, but pursuing so many legal cases at once could harm the Ritz’s VIP attendance.