talltree2 - Rehma Mohamed Professor Elrod TallTree2 Hotel...

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Rehma Mohamed Professor Elrod TallTree2 Hotel Casino Case Analysis Property president: Terrence Wei Industry: service industry (casino industry) o Located in Reno, Nevada, the TallTree2 Hotel Casino features Nevada-style gaming. Besides the hotel and casino, however, it also has four restaurants, two entertainment showrooms, and three gift shops. o Casinos generate revenue by keeping their customers gambling within their property. This requires that the casino provides drinks, food, and rooms. Thus, the revenue for TallTree2 Hotel Casino comes from the casino (64%), rooms (14%), food (12%), beverage (6%), and other (4%). o While majority of the revenue comes from the casino department, management wants to utilize the other departments as profit centers. o TallTree2 Hotel Casino has developed special events that compensate for the slow periods. These special events were developed to create incremental revenue. Some of the special events have included: Golf tournaments Boxing matches New Year parties Pit, keno, and slot tournaments Since Mr. Wei has been his position, special events have to now be approved by the Casino Marketing Committee and must have a proposed budget. This is to ensure that every department is a profit center, not a cost center. 1. Can any of the TallTree2 departments be run as a profit center? a. Casino department: as stated above, 64% of revenues for TallTree2 come from this department. Thus, this department should be run as a profit center.
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