Small Casinos in Big Trouble

Small casinos might struggle to survive the financial crisis, the president of the American Gaming Association said at a conference Tuesday.

Speaking at the Las Vegas Convention Center before the Global Gaming Expo, Frank Fahrenkopf Jr. told reporters that size is a major issue for companies that support casinos, such as slot manufacturers and other suppliers.

"The big guys have more ability to go out in the marketplace and raise some (capital). Some of the smaller companies do not," he said.

Slump
Casinos of all sizes have taken a hit during the current financial crisis, with nationwide revenue in the third quarter falling by 4.6 percent to $8.4 billion, compared with the same period a year earlier, according to Fahrenkopf.

Fahrenkopf said companies are dealing with two unprecedented problems: banks unwilling to lend money at favorable interest rates to build projects, and consumers spending less on gambling and entertainment at casinos.

"All of our companies, if you talk to their CEOs, they will tell you, they are tightening their belts," Fahrenkopf said.

G2E
Around 30,000 people have attended the show over three days, with about 750 exhibitors setting up to advertise every different service used in the gambling industry.