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FOBT News
Pubs are starting to feel the pinch caused by the heightened competition of the FOBT market with some sites suffering a reported 50 per cent decline in takings as their customers decided to spend their money in nearby bookmakers.
It appears that the prospect of an adult stake of up to �100, combined with the possibility of winning five times that amount is far more appealing to many traditional pub AWP players than a 30p stake for a �25 jackpot.
It appears that pubs that are located near to LBOs are suffering the most from the competition.A Greenwich licensee, whose pub is just 25 yards from a bookmakers, told the Publican
My takings on the AWPs have dropped by 50 per cent in recent months.
I was in the bookies for a bet this week and a customer on one of these machines had built up credit of �2,800.We can�t compete with that.
Another pub manager in Leeds told how he�d seen taking drop by 30 per cent in just six months. David Purvis, sales and marketing director at Leisure Link, said the FOBT was bound to make a difference
It must have affected pub retail because it�s a new product and value for money.
Licensees have been criticising it for some time and it has stolen a bit of a march on what pubs offer.
They want to know why they can�t have a fixed odds betting terminal but it�s because it�s still regarded as a betting machine.
Even when the new legislation comes in,the FOBT will be tantalisingly out of the reach of regular pubs.
Reclassified as a gaming machine, it will be pigeon-holed as a category B machine which members� clubs will be allowed to operate, but not public houses. John Powell, MD of SE Leisure and chairman of the Independent Operators Association, agreed that the FOBTs are having a detrimental effect, but it�s hard to measure precisely the cost to the machine income.
He explained It really does vary from site to site,depending on the competition not just from LBOs,but from other pubs.
He argues,however, that while a great deal of the decline is down to FOBTs, the pub AWP market has been in the doldrums for some time
It is partly due to a lack of innovation in pub AWPs.
They�ve remained the same year in, year out,with only minor modifications.
But the FOBTs have been a big danger and they�ve knocked out on average 10 per cent.
But Powell believes it is not all bad news and the pubs have something in their armoury that will help stem the tide
Note acceptors on machines have made a big difference in machine income,where they are managed properly.
We�ve noticed an uplift of probably between 7-10 per cent in takings with the acceptors.
However, the machines have to be looked after and refilled everyday, because if the hopper is too low then the machine will not accept notes and the customers will get annoyed and stop using the facility.
Mitchells and Butler�s John Appleton said that while his firm hadn�t experienced a decline of the levels mentioned in some quarters, FOBTs have still impacted on machine income, especially at sites close to bookmakers.He confirmed: �Overall management action has mitigated much of the negative impact, but this is unfair competition and if ever there was an uneven �playing field� this is one.
We hope that a favourable triennial review of category C machines stakes and prizes is not delayed beyond October this year as it is very much needed by the industry.
While the Gambling Bill will offer no respite to pubs in this situation, they might benefit from the triennial review which is currently being conducted by the Gaming Board.
If the conclusion of the review would see AWPs sporting higher stake and prize options, then pubs might be successful in winning back some of the custom from the bookies.
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