Starting a Slot Machine Business

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Understanding the Slot Machine Industry

Illinois Slot Machine Business

Under current Illinois law, licensed establishments are allowed to operate up to six video gaming terminals (VGTs) per location. The Illinois Gaming Board (IGB) oversees the licensing, regulation and tax collection of the video gaming industry.

Not every municipality allows video gaming in Illinois. On the IGB website, you can find a breakdown of each municipality in the State and if they allow video gaming. If your municipality doesn’t allowing gaming right now, we are here to help!

In 2018, the average month of video gambling in Illinois generated $123,381,510 in total revenue.

profits associated with an illinois video gaming business

What is Your State-Determined Cut of the Profits? 

Pie-Chart_Chicagoland-Area-Graph

Net Terminal Income (NTI) is defined as the money put into a VGT minus the credits paid to the player. The State of Illinois receives 33% of the NTI generated from each licensed VGT (of that, 5% goes to the local municipality). Of the remaining 67% of NTI, a company called Scientific Games receives 0.8513% as compensation for maintaining the Central Communications System (CCS), which all VGTs connect to. Finally, the remainder is divided equally between the Terminal Operator (who owns/leases and places the VGTs in locations) and the Licensed Location's business owners.

Slot Machine Terms You Need to Know

Video Gambling Terms

It doesn’t matter if you’ve been in the slot machine industry for years or you have no experience, there are MANY terms to know and understand. For instance, one source of confusion is what to call the actual industry. Is it video gaming? Is it video gambling? Video slots? Slot machines? Truth is, it just depends on the person(s) talking about it. For instance, the IGB refers to it as video gaming (hence, the Video Gaming Act). But, if you are talking to a person that plays the VGTs, most likely they are referring to them as video slots.

slot machines in Illinois

Here are some of the terms and definitions you’ll find in our terms guide:

  • Illinois Gaming Board (IGB) – The IGB is the state agency that regulates both casino gaming and video gaming in Illinois. The Board itself is a five-member board, appointed by the Governor and confirmed by the Senate. They have a large staff consisting of investigators, enforcement agents, financial and licensing staff, as well as attorneys. The IGB investigates and issues licenses to persons and entities involved in gaming and regulates all day-to-day gaming activities.
  • Terminal Operator (TO) - The TO is the licensed entity that owns, services, and maintains VGTs for placement in Licensed Video Gaming Locations (licensed Retail Establishments, Truck Stops, Veteran and Fraternal Establishments). In the State of Illinois, to operate video slots, you need to have a signed contract with a Terminal Operator.
  • Central Communications System (CCS) – The CCS is designed to provide real-time communication to and from every licensed VGT in the State.

How to Secure Your License to Run a Slot Machines Business

Illinois Gaming Board License

If you’re new to gaming and wondering how to get started with VGTs, you’ve come to the right place. We’ve outlined some of the most important steps you’ll need to take if you’re looking to add video gaming to your location:

  1. Ensure your Illinois business is operating in a municipality that allows video gaming. The IGB’s website provides a list of where video gaming is permitted.
  2. Make sure the type of business you own (or plan to open) is one of the types of locations allowed to apply for a video gaming license.
    1. By law, there are four categories of video gaming establishments that the IGB can license:  retail, fraternal, veterans and truck stops.  However, a wide variety of businesses make up the category of licensed retail establishments, including some that are known as “non-traditional.” Learn more about non-traditional gaming establishments here.
    2. Note: Unless you qualify as a truck stop, you must have (or obtain) an on-premises Illinois liquor license and serve alcohol at your location.
  3. REALLY IMPORTANT STEP: Fill out the application for your gaming license! There are 10 parts to the application that your Terminal Operator can help you with. Luckily, we’ve broken down the process to becoming a video gaming establishment in seven easy steps.
Download 7 Steps to Becoming a Licensed Illinois Video Gaming Establishment

Preparing Your Slot Machine Business

Illinois Slot Machine Business

Now that you’ve applied for a license, it’s time to start thinking about where your slot machines will go within your establishment. The placement of your video gaming machines can directly influence how successful you are. Once you’re licensed and ready to go, the last thing you want is lost revenue due to distraction or a poorly planned gaming room.

There are certain things you need to be aware of when designing space for your VGTs, and a few of them are required by law.

  • Signage (required)
  • Dedicated electrical (required, and most Terminal Operators will provide or help provide)
  • Stanchions to separate the gaming area (required if patrons under 21 allowed in your location)
  • A clear line of sight to the entrance to the video gaming area by employees of your location who are 21 years of age or older

 

Other considerations:

  • Purse hooks
  • Spacers between machines, if space allows for them. Even better if they provide a space for patrons to charge their phone!
  • Bin for cash out vouchers near the NRT or ATM
  • Terminal Operators can provide guidance when creating your gaming room

From our experience of designing and redesigning gaming rooms, we know what layouts contribute to a successful gaming environment. For instance, privacy can make players much more comfortable, as well as nice chairs and a non-drafty space that’s not too noisy.

Want to see your game room re-imagined?

Call us today and our game room design specialist will re-design the space with no obligation from you!

mock up video game room

Staffing Your Slot Machine Business

Illinois Gaming Jobs

There is an art to staffing your video gaming business, and it can be more intricate that you might think. First, hiring the appropriate staff is really important. Whether that means hiring responsible and friendly bartenders, or a dedicated gaming manager, you need to make sure that they are ready and able to perform the functions when it comes to a slot machine area.

Your video gaming application requires that you name someone to be a video gaming manager.  If a lot of your business will be focused on gaming, hiring a dedicated person to serve in this role is a great idea. This person would work with your Terminal Operator and manage license renewals. He/she might also manage social media and marketing efforts, customer engagement and promotions.

Staff training will be key once you get slot machines and your Accel Relationship Manager is instrumental in providing you this information.

A few pointers to keep in mind for training:
  • Gaming is strictly limited to individuals 21 years of age and older.  Your staff will need to card patrons in the gaming area (preferably before they enter) and at least one employee who is over 21 years of age must always have a clear line of sight to the entrance to the gaming area.

  • Your staff should also be prepared if any issues occur, like who to call if anything happens to a video gaming terminal (VGT) or if patrons experience problems with cashout vouchers.

  • Your staff should be familiar with those involved with the gaming industry (as it relates to the maintenance of machines and collections).
  • Discretion should be a top priority among staff and patrons. Stressing the importance of keeping financial information confidential is huge!

 

How Long Does it Take to Get Slot Machines

Illinois Video Gaming Application

The process for getting licensed as an Illinois Video Gaming Establishment can be a long process, in part depending on your ownership structure. With any licensing process, it’s difficult to determine the exact amount of time it will take to complete. You should not expect to have VGTs immediately after applying. In most cases, you can expect the process to take about 2-3 months. However, certain steps can take longer than others and delay your location going live with video gaming.

 So, how can you prevent delays in the process?

  • Work with your Terminal Operator to make sure all paperwork is completed correctly
  • Check that all licenses required for a video gaming license are up-to-date (state liquor license, local liquor license, etc.)
  • Ensure all required signage is in place
  • Pay all fees (IGB license fee and any required Municipal fees)

    Reach out to us to get the process moving today!

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