Going in Circles

Next January I’ll celebrate 30 years in the industry as a game and FEC operator, first operating redemption 25years ago in 1983 and cranes & merchandisers in 1986. In the early years we were working in the dark, gropingaround to see what worked. That got a lot easier as the years went by and the industry developed a body ofexpertise. I needed all of that 25 year learning curve and made plenty of mistakes along the way. Now I make myliving helping other operators avoid the same mistakes and to get up to speed quickly on redemption management.If you are reading this you are probably a Redemption Plus customer, so you’ve made a great choice sofar. I was a customer myself for 8 years before merging my business with the company, sold on the system thatcomes along with the merchandise.

The Redemption Plus system is based on operating principles: Game Management, Merchandising, Controls,Purchasing. Doing all four well maximizes profitability in the redemption game business.

1) The Games are the Cash Registers; that is wheresales are made. They have to a) be the right games,the ones that people want to play; b) score, operateproperly, and be kept neat and attractive; c) bearranged well to compliment customer behavior andcirculation, and d) have proper payouts (each gameis designed to pay out a certain ticket value in orderto maximize its sales).

2) The Merchandise Drives Sales: Redemption wouldbe a great study in psychology for a graduate studiesprogram. Remember, while certain customers doplay for a particular piece of merchandise we usuallycan’t tie a specific item to a specific sale. It’s thewhole package! A bright, exciting, active and, often,BIG display of colorful merchandise drives the salesin the games!

3) Control (Game Management) and Cost of Sales First: Counting back stock inventory (while necessary) andpinching pennies on merchandise are not redemption controls. Control starts on the sales floor with thegames (See #1). If payouts are not maintained (usually because of mechanical-technical problems), thenredemption costs will be out of control. As a Redemption Plus customer we provide you with the tools tocontrol ticket values, merchandise comes bar coded for you, and a digital packing list allows you to avoidinput-keypunch errors, a major contributor to inventory mistakes. The Redemption Plus system allows you tozero in on a cost of sales number and work out from there.

4) Purchasing: Buying the right merchandise that people want to play for, setting fair pricing that creates highperceived value, and maintaining stock levels are key contributors to redemption profitability.

These are just a few thoughts on four critical aspects of redemption; there are many moving parts to have theCircle spinning effortlessly toward maximum profits. More parts than we have time to discuss here.