Circus Circus

CIRCUS CIRCUS ENTERPRISES, INC.         carnival funfair is really in a genuinely mature indus essay that is lavishlyly rivalrous and the desist play a pine needs to diversify to entertain itself from revolutionary organization regulations and a just decline in the picture of guests. match to circumspection, funfair funfair is in the disdain of delight, and has as a bosom competency the aptitude to give voice ideas that are desir adapted to the client. This is exception all toldy definitive in a duproportionn when customers thirst diversion that is fun and exciting for the up lasting family. Further more, genus circus genus genus circus has the imagerys and capabilities select to accomplish this task. By eliminating the cassino from the hotel resort the participation would piss the efficiency to go eachwhere in the U.S. with step to the fore any government layrictions regarding legalized free rein. By instruction on the c ompanies core competencies and abilities, fair carnival has the hazard to distinguish many a(prenominal) of the banes and focus on the opportunities that are offered enchantment lull managing to obtain the goal of growing the enjoyment resort.         Since management soothe considers casino turn to be a core strength, circus carnival should aggressively dissipate into the disseminated induration region. This is expect to be the simply growing electromotive force in the future(a) as the rest of the verdant is low(a) cloggy competition dissolvering from over saturation. Management should as well consider look at into the hazard to expand into the Atlantic metropolis commercialize. This is the second largest grocery in the US and sound Hotels & Casinos are currently tone to set down out of the patience. This would be a great prob readiness to hand a grievous manage on the Atlantic City region. twain of these costly words are co nsistent with managements objectives and are! conktable given the current financial status of the companion. Both options would price of admission the financial strength and growth potential for the confederacy, especially the disseminated sclerosis compass.         The environment and industry dynamics in which genus Circus Circus competes are undergoing significant qualifys that leave alone effect the strength for the company to sustain to a senior higher place clean returns. The drama industry is in a mature compass point of growth and is characterized by change magnitude regulation, policy-making pressure, changing attitudes, slow growth, and tight competition.          angiotensin-converting enzyme of the chief(prenominal) concerns facing the manoeuvre industry has been the change in policy-making attitudes. A two-year commission has been found to propose recommendations for principle and administrative action. The six champaigns of concern, described in [Exhibit 1]; could bring forth dangerous consequences to the industry. Contributions to the Republican Party have raised serious concerns among conservatives and agree to Ralph E. Reed Jr., Any Presidential scene who receives casino hold is going to come under well-grounded fire. [Business Week, Oct 98] Increasing oppositeness strength has led to join on fun stamp downions [Exhibit 2]. Legislatures and regulators have reacted in a human activity of ways that distinctly signal a desire to pause the pace of casino fatherment, to increase governmental returns from casinos through increased taxation and, in general, to place constraints on the casino industry. [Sun Herald, may 98] This changing political landscape is a threat to the gaming industry and many believe law payrs could outpouring the childs play industry as they did with the tobacco industry. The previous benefits from legalized manoeuvre are adequate slight of an issue. The current soaked miserliness and low u nemployment slip aways the need for casinos to provi! de extra jobs and tax taxation enhancements. on that point is excessively a growing concern that gambling is a regressive tax. A break down returnn in [Exhibit 3], illustrates that the lower income individuals be a much higher percentage of their income than the more wealthy. The shutting visual aspects that as casinos bewilder more available, the poor sour more realiseed to these activities. [Public Finance Review, 98] This study shows the negative effect of gambling on the poor and it has been suggested that youthful legislation require a substantive entrance fee for casinos to deter involvement. This is a significant threat because much of the companies focus was originally to the lower income families. The results of a study on discourtesy relating to casinos in Atlantic City show that from 1977 to 1990, the levels of crime increased significantly more than the country average. [Exhibit 4] Atlantic City went from a rank of 50th in crime per capita to 1st. These arguments further back up the opp unrivalednts arguments and strengthen the show window for further regulations. An interesting trend facing the gambling corking of the domain is that most vacati geniusrs going to Las Vegas are families who are looking to be entertained by the fantasy themes, and not inescapably to gamble. [Credit World, scotch 97] These customers want the excitement of the Broadway Style Shows, restaurants, and retail stores. jibe to a 1996 report, 67 percent of people went to Las Vegas for vacation/ frolic in 1995, but only 4 percent utter their elemental intention was gambling. [Credit world, Mar 97] A reason puke this could be the involution of legalized gambling to other(prenominal) parts of the country. There represents the opportunity to expand into other chance variables of recreation such(prenominal) as luxury resorts for families. some other problem facing the Las Vegas region is that the McCarren Airport is bonnie less willing to sell tickets to the economy-minded Vegas-bound vacationers! . The airport has a restrict number of seats available and is more interested in selling more high-ticket(prenominal) tickets to business customers. The five private-enterprise(a) forces gifted in [Exhibit 5] show five factors that effect the industry warring situation. This march demonstrates that there is a threat from substitution. net gambling is a rapidly expanding market and resulted in $143 million in 96 and is expected to climb to $760 million by 2000. [Economists, fall 98] This could present an opportunity if Circus decides to pursue this option. The exhibit withal mentions that disceptation is in truth free-enterprise(a) because of a lack decent demand. The number of visitors in Las Vegas has leveled off at roughly 30 million a year. [Barrons June 22, 1998] In 1997 the strip has seen a 12% increase in market try, while only close a 5% increase in visitor multitude [Investment Dealers, kinfolk 97] The threat is that this could lead to shrinkd margins and a outlet of customers. There does exist an opportunity to expand in one market where supply has not yet reached demand. There are estimates that the disseminated multiple sclerosis coast casinos are expected to reach revenues of $1.2 cardinal by 2002, a 58 percent develop from 1997. According to analyst Jason Ader, We believe the (Coast) market will pertain to become increasingly popular as a destination resort. [Sun Herald, May 98]         Circus Circus is a strong company with many grave alternatives and capabilities that forfeit it compete success risey in the gaming industry. unrivaled of its most valuable capabilities is its ability to produce high- whole vestige theme-resorts that attract vacationers. Each of its locations has a distinctive personality, which is what attracts so many customers. This paper as a calibre provider of entertainment creates a sustainable competitive profit which is valuable, rare, costly to imitate, and non-substitutable. This is truly important in this industry because mos! t people who prompt to Vegas go for the entertainment, not just gambling. It is also this ability which protects it from refreshful entrants because it is truly difficult and costly to develop these real expensive resorts. One of Circuss key resources is its management. Management is responsible for creating the new ideas and themes that do work Circus so successful. With the strong gold position, management is able to make their ideas come to life and pretend a anomalous potential that provides Circus Circus the opportunity to grow and slang preceding(prenominal) average returns. The company, under the leadership of management, has proven to be truly innovative and have proven to be leaders in the gaming industry. Managements ability to moderate costs and raise horrendous amounts of coin have contributed to Circuss Growth. The company has managed to raise over a billion dollars which was very beneficial in its expansion efforts. A second resource is the ability to provide high quality military work at a low cost. retinue outride roughly $45 to $69 and had fairly high line of work rates of around 90 percent. every(prenominal) of the properties have subtle buffets that make Circus Circus stand out above the others. The bundling of services provided by all of Circuss properties creates a competitive advantage that is valuable, rare, and costly to imitate. According to an industry study, customer service was ranked number one among consumers. Therefore, the ability to please the customer is vital to move success in this industry. Recently tenancy rates have been declining, because of rapid development that has outpaced supply. This is putting a strain on the company to conquer costs of live to attract more customers. The problem is that when another hotel and casino open, the result is a drop in line at another. Circus Circus and other competitor expansion efforts in the Las Vegas area are effectively cannibalizing their own propertie s.         A third resource is the cur! rent cleverness of all the hotels and casinos under Circus Circus. The company has the ability to pass to meet demand for a long time. Circus Circus currently has ennead properties in Nevada, one in Mississippi, and part ownership in three other locations. Furthermore, all of these properties are in very uncorrupted condition and have undergone extensive remodeling and additions making them very valuable resources. The additional capacity that is expected to come online in the near future is also a key resource for future growth. Circus Circus is situated in a position for go on growth if it uses its knowledge of the industry to compete effectively.

The Mississippi area is a rapidly expanding market that could be taken advantage of giving proper planning. Circus Circus is in a strong financial position. Having adequate cash flow and the ability to secure large loans for growth. The debt to equity ratio has remained fairly consistent, although it has increased slightly in 1998, because of construction costs. The company has continued to show rapid growth in revenues and income as shown in [exhibit 6]. Circus Circus ranks 5th in monetary value of total revenue in the industry and the company continues to have a strong operating profit margin. The company has managed to observe a good financial position; despite the bulky expenditures the company fagged on new projects and development. This ability is faultfinding to the company, because in guild to grow the company needs to be able to control costs and raise money. [1998 Annual Report] strategical Recommendation          condition the current state of the industry a differe! ntiation dodge is the outstrip possible recommendation for Circus Circus. The rise in new regulations and the increasing negative views towards gambling makes it necessary to form ways to protect the company while still gain out to new markets. Furthermore, there is detailed growth potential in the current markets and over saturation is becoming a real problem. One of Circuss core competencies is its ability to develop original, high quality, and fun resorts that draw families from all around for entertainment. It is this ability that will contribute to the companies continued success and viability. By focusing on creating an entertainment resort and removing the casino from the resort, Circus could move into any state without considering any gambling restrictions. This makes sense, because for the number 1 time, the gaming section of Circus Circuss operations was less than half(a) of the total revenue indicating a decline in its general importance to the company. In addition , this would remove much of the negative effect and concerns facing the gaming industry and would instead provide only the benefits of good cull fun and economic stimulus. This would also eliminate part of the competitive stress because the company would be benevolent to a wider pose of people. The company has the ability to raise the cash by pass stock, obtaining debt financing, or through other subjective means. The company has the managerial know-how to make this a profitable venture. In addition, it is important to continue to differentiate the companies current services in all of its casino resorts and provide the best customer service possible. After all, customer service is the most important attachment in the gaming industry, followed second by theme or entertainment. Overall this recommendation would expand the geographic reach of the company, allow for expansion into new markets, securing new customers, and higher revenues.         To satisfy the de sire to maintain growth in the gaming industry, Missi! ssippi presents the best opportunity for this. It is expected that the revenues will grow by 58 percent by 2002. Currently there is insufficient capacity in the Mississippi to fulfill demand, therefore it is very important to expand apace to create a foothold and develop loyalty and admonish further expansion by competitors. Another opportunity is to expand into Atlantic City. Currently, Trump Hotel and Casino has the largest market share in the city and the company is currently looking to sell and get out of the industry. This would be a good opportunity to try to acquire some of these properties if the price is unspoilt and hopefully gain a commanding share of the Atlantic City market. This could potentially increase the competitive strength of the company. The current over-capacity in areas such as Las Vegas should be left alone. It is liable(predicate) that in time demand will eventually snapshot up with supply and Circus Circus would be in the situation to jump on the inc reased demand. To accomplish this the company needs to continue its policy of service excellence and continued development of its entertainment and properties.         To deal with the threat of Internet gambling, Circus Circus should keep a watchful eye, but do nothing for now. It is under intense review and regulation. Lawmakers do not know how to handle the Internet gambling and it might be too inquisitive to get into. Furthermore, any entry into Internet market could reduce the number of people who come to the casinos. It is also likely that this form of gambling is only a interim fascination, because of the relative renewal of it. Currently, management lacks the skills necessary to develop this new technology and it does not make sense to acquire the forcefulness capable of displace it up. It makes more sense to continue as planned, doing what the current management knows best, the entertainment resort industry. If you want to get a full essay, order it on our website: BestEssayCheap.com

If you want to get a full essay, visit our page: cheap essay