Bookie bets on law change for better business
Published:Friday | June 18, 2010 | 12:00 AM
Sabrina Gordon, Business Reporter
Track Price Plus Limited is planning a multimillion head-start to cash in on a one-month old legislative change that expands business possibilities for bookmakers, even as the country's betting and gaming watchdog is forecasting that some of the 11 registered bookies may be forced out of business by the upgrading.
Taking the early lead, Track Price Plus, one of Jamaica's largest and oldest bookmakers engaged in horse racing and other sports betting, will be spending around J$50 million over the next year to freshen up the look of its betting shops with location redesigns, while opening an undisclosed number of new spots.
"We can now have slot machines in the betting lounges, offer food and beverage, and a complete betting and sports lounge now," Xavier Chin, the owner of Track Price Plus Limited, said of the opportunities created by the May 6 changes to the Betting Gaming and Lotteries Act.
"The amendments will allow us to sell other things other than horse racing and sports betting."
The transformation of some of the traditional betting shops in gaming lounges is expected to start in the busy Kingston capital and rolled out into other parishes over the coming months.
Other shops will be given a more limited facelift with new signage and the introduction of betting by telephone.
"We will redesign our existing shops to give customers more options with games like poker, bingo and slot machines as well as offer food and beverage," said Chin.
He declined to say how many new locations will be added, noting that the number would be determined by the market.
"We will test it in different areas, but one of the first will be Kingston, then Ocho Rios, where we will have a betting lounge and not just a basic betting shop," Chin added.
Already, Track Price Plus has advertised for approved individuals and companies to sign up as agents, an opportunity enhanced by longer opening hours to 11 p.m. from the previous midday closing time.
Track Price Plus now operates a network of 65 branches and agents throughout the island with sales amounting to J$950 million at the end of December 2009, shy of the J$1.2 billion in sales it had projected.
And while the company is yet to get the green light from regulator, the Betting Gaming and Lotteries Commission (BGLC), Chin said that he is pleased that the amendments are now law, a move he said the industry has been anticipating for a long time.
Orderly expansion
"The amendments to the BGLA, which became law subsequent to May 6, 2010, is to facilitate the orderly expansion of the gaming industry including sports betting," Derek Peart, the executive director of the BGLC, told the Financial Gleaner.
"Licensed bookmakers will be able to operate betting lounges with gaming machines, wagers on sports and animals, the purchasing of lottery tickets, the watching of sports and other events, and other forms of entertainment."
He expects that the change will result in significant financial gains for those bookmakers who can capitalise on it.
"All of this means that the investment cost can be spread over a wider range of activity and therefore reduce the unit cost of doing business," Peart said.
With total industry sales last year of J$2.9 billion, the BGLC official said operators are making what he described as only modest returns, with as low as J$50 million in annual sales.
"The amendments mean that betting, not only on sports, can be done electronically, including by way of the telephone and the Internet. This will open up the prospects of significantly increasing the distribution channels for wagering in a more cost-effective way," said Peart.
The number of gaming machines the bookies will be able to operate in each location is capped at 19.
Meanwhile, the changes to the betting and gaming law will also extend the lifespan of bookmakers' permits, creating the environment for better planning, the BGLC's administrative head said.
"Bookmakers will be eligible to receive permits of up to five years, instead of one year, with annual review."
But as the amendments bring added business for bookmakers, it may also lead to some consolidation in the industry, according to the BGLC.
"It will increase the distribution channel for those punters who use the Internet and the larger groups who use the telephone and contribute to improved efficiency,