Casino slot machine and electronic table game supplier Aruze Gaming America Inc has been shifting from its established business model of outright sale of its products to casino operators, amid the cash constraints placed on the industry by the Covid-19 pandemic, says Robert Ziems (pictured), the firm’s president.
“Our primary business has been outright sale of slot machines to casino operators, rather than leasing or gaining recurring revenue from them,” he noted.
Since the pandemic, “there’s been a drastic change, especially with casinos having to cut their capital expenditures,” the executive observed.
“We are now offering customer [operator] financing, that can help with casinos that still want to buy [outright] but are trying to control their cash, and we have switched to a more of a lease and recurring-revenue model in order to meet” industry needs, Mr Ziems stated.
He was speaking in an online interview with Frank Fantini of Fantini Research, a gaming industry news provider and consultancy.
The president of Aruze Gaming America – a privately held company founded by Japanese gaming entrepreneur Kazuo Okada – was asked about the business outlook for the casino supply sector.
Mr Ziems stated: “The purchase of our machines is down drastically compared to what it was in 2019,” which had been a “great year” for the brand.
“It’s nowhere close” currently “on the purchasing side,” he added.
But the executive noted: “We’re expecting in quarter one [2021] to see that start to change.”
Although he cautioned: “I’d like to be wrong about this, but I don’t think most of us [casino technology suppliers] are going to perform in 2021 the way we did in 2019.”
He further stated: “I think there’s going to be a drastic improvement early [in 2021], and then gradual [improvement] through the rest of 2021.
“I think players are just going to have a different feel” regarding the casino environment, “with trying to be safe and [being] conscious about cleanliness” as “never… before”.
“I think it will be ‘more’ of a return to normal in 2022,” said Mr Ziems.
The executive stated that in North America the firm had 100 employees, and globally “near to 1,000″. “We have a large manufacturing facility in the Philippines, which is where we bend all the metal, and make the boxes [game cabinets] and we have a large research and development team… in Japan.”
Mr Ziems said Aruze Gaming America had – like many of its peers – furloughed a significant portion of its workforce at the start of the global health crisis in early 2020, as casinos temporarily shut down in many markets around the world.
He added: “I’ve been impressed that… folks [Aruze staff] are resourceful, and our productivity hasn’t suffered at all,” even though circa “70 percent of our workforce that was normally in the office still works remotely.”
