What elements should be considered to create a casino industry from the ground in a new market such as Brazil?
John Connolly - First of all a regulatory body should be set up. Premises would need to be licensed, ideally, all local employees should also be licensed and only those with clean backgrounds should be certified. The gaming commission should have authority to oversee all licensed premises. All equipment should be passed fit for purpose by a weights and measures authority. Responsible gambling awareness should be a requirement for all gaming employees and all those personnel who serve alcohol. Gamblers anonymous should be available to patrons who may have a problem with their gambling habits.
What are the legal and business challenges that an international investor may face in Brazil?
As we have seen in other Brics countries casinos have generated much interest and RoI has been substantial. Taxation levels should not be so high as to discourage investment
as
business will level off after the first five years: The Las Vegas business model should be considered as we have seen much reinvestment throughout the decades and this will be necessary to keep future local and international visitors interest and excitement on a high plain.
Future new casinos should be operated just by a local company, international groups or with a mixed model? Is Brazil an attractive market for key international casino brands?
Yes, Brazil is a very attractive market. I am sure all the large casino brands will be queuing up to have a foothold in this marketplace and I would suggest a mixed model, as local partnerships will aid with integration. Certainly Sands Corp, MGM, Hard Rock, Century Casinos, Sun International, Melco, Suncity Group, groups from Macao such as Macau Legend Ltd who are building a resort in Cabo-Verde an ex-Portuguese colony. Billions of dollars will be spent on building these resorts and Chinese firms will enhance casino tourism and this is an added advantage, to the benefit of the Brazilian economy. The main cities and coastal resorts will be the focal point of the international casino brands, so perhaps local companies only could operate in the smaller remote cities.
What would be the impact of having integrated resorts and casinos in Brazil?
The impact would be to create a large service industry within the environs of such resorts. Improvements in infrastructure. A great amount of local employment, although expatriates will be needed to provide the expertise. Taxation to benefit local government coffers.
Do you think that the future Brazilian market can be similar to some other one worldwide? Is there any market similar to what Brazil may become?
In terms of land mass, population and GDP it is difficult to find another comparable gaming jurisdiction. Brazil would certainly outshine any other South American country. South Africa, for example, has a strong gaming market although it is a little insular, therefore there is an opportunity for Brazil to be a huge player in international casino gaming.
Is it clear the player profile of Brazilians in order to create an industry that considers those features?
In my opinion, Brazilians belong to a rich society of European, African and Native ethnicity and this lends itself to having an appreciation for casino games, as we have witnessed in other parts of South and Latin America. I would suggest a mixture of the European and US gaming models. With a strong emphasis on traditional games of chance. The important lessons which we have learned is that good customer service is the best reward for player loyalty as the in-house market is the main focus of importance. Strong security and surveillance is a requirement in all gaming operations and experienced players from across the world will also be attracted to a new location. We have experience of this in all the latest jurisdictions to be opened up to the international casino gaming industry.
Source: Exclusive GMB
