Running Head: CASINO COMPANIES 1

Wynn Resorts, MGM Resorts and Las Vegas Sands Corp. Casino Companies Analysis

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Introduction

The Casino business is one of the most profitable businesses in the gambling industry. In

the United States, a major region where the activities are carried out is in Las Vegas. Gambling,

being the main service in the industry, refers to the act of risking something of value to acquire

greater value. Some of the players in the industry include, Wynn resorts, MGM resorts and Las

Vegas Sands Corp. However, in their operations. These companies experience various effects

from political, socio-cultural and Environmental factors, as such, this paper focuses on

evaluating these factors and their role across the companies.

Political Trends.

Political factors play an important and fundamental role in the running and operations of

business in a country. Across the globe, every country has its own rule, laws and regulations

curtailed towards the control of the extent or the various services different industries provided.

The provided regulations are aimed at ensuring that businesses operate with regards to the ethical

aspects of country. And in the United States, the stipulated laws and regulation in every industry

are provided by three different entities, local, state and federal governments. The gambling

industry, as such, is controlled and assessed through these entities to ensure that legalities are

adhered to. In the United States, Las Vegas is the largest gambling playground where the biggest

high stakes casinos operate. Among the big fish in the industry, Wynn Resort, MGM and Las

Vegas Sands Corp hold significant ties with the political sphere of the region. The Las Vegas

Sands Corp, for instance has high-political profiles controlling its operations, such as its

Chairperson Sheldon Adelson (Taylor, & Allison, 2019).

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With the recent global pandemic caused by the novel Coronavirus, the United States

government imposed regulations that saw the closure of MGM Resorts, Wynn Resorts, and Las

Vegas Sands Corp among other businesses. The Nevada state governments stated that the

companies including other business would resume operations as per their directives (Silverstein,

2020). Previously various regulations had been proposed by the government aimed at the

prevention of sexual harassment within the Casinos. This followed, the claims that Wynn Resorts

former chairman and Chief Executive Officer Steve Wynn had sexually harassed his employees

(Sayre, 2019).

Across the different Casinos operating in the United States, political as well as legal

trends are experienced, and their effects in these companies are significantly identified. One of

the companies, MGM Resorts, operating in the United States, has experienced several

implications as a result of legal trends. The company was sued as a result of a data breach that

affected about 10.6 million of its hotel guests (Sigh, 2020). The company had previously faced

staggering lawsuits involving a mass shooting that affected over 4,500 people. The shooting

carried out by one of its hotel guests, resulted to loss of lives and traumatic experiences to

numerous people, as a result, the company, having hosted the armed shooter faced legal

implications (Zusha, 2018).

Socio-cultural Trends

Assessing the socio-cultural trends facing an industry involves the evaluation of several

factors. The factors determine the reception of a business in a given population and as such, with

the gambling industry facing several connotations, such as it being legal or illegal, and

acceptable or sinful, among others. In the United States, Wynn Resorts, MGM Resorts and Las

Vegas Sands groups play crucial socio-cultural roles in the population and these ranger from
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employment to the creation of revenue for the country. Socio-cultural trends in these companies

include, employment and wage taxation revenues, consumer benefits, and development in the

economy (Walker and Sobel, 2016). MGM Resorts, Wynn Resorts and Las Vegas Sands Corp,

have experienced several socio-cultural trends, that have led to the growth of an economy in not

only the state government, but also in the federal government’s revenues. MGM resorts, have

indicated their individual approach in promoting corporate responsibility, aimed at benefiting its

large pool of employees and the communities it operates within. For instance, in their expansion

into other markets, the company not only ensures growth in employment opportunities, but also

facilitating a broader impact in the community. MGM resorts through collaborations with

minority and women owned local business in the regions, facilitates the improvement of lives

across the socio-cultural realms of its operations (Murren, 2020).

In Nevada, the gambling industry, spearheaded by Wynn Resorts, MGM Resorts, Las

Vegas Sands Corp and other casinos, are a major boost in the economy. These large companies

have successfully proven a positive impact in the society through the creation of employment

(Murren, 2020). The companies, According to the American Gaming Association, of which they

are a part of, have made significant contributions to the society through donations and charitable

events (Murren, 2020). However, the emergence of the Coronavirus and its spread across the

United States and other regions, have affected the tourism and entertainment industry, of which

the companies are a part of. The virtual shutdown of the economy in the United States, and thus

experienced across the three multi-billion dollar companies, as an approach aimed at curbing the

diseases’ spread, caused severe economic challenges as operations begun to nosedive (Edwards,

2020). The companies made announcements of their closure, and with it followed unprecedented

challenges to thousands of employees affiliated to the companies.

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Environmental Trends

The environment is an important aspect for every business, especially in the current

century where emphasis is made on the reduction of global warming. As such, the casino

companies have played a significant role to this effect. Wynn Resorts, MGM Resorts and Las

Vegas Sands Corp casino Strip have provided effective strategies aimed at the conservation of

water in not only Nevada, but also globally by identifying means by which the objective can be

achieved. The fountains in Nevada including, The Fountains of Bellagio show, and Venetians

iconic indoor fountains are not just epitomes of beauty and extravagance but also water

conservations programs that have resulted in the saving of water every years, in millions of

gallons (Murren, 2020).

The casinos and resorts affiliated to the Strip have shown increased interest in the

conservation of the environment through the adoption of renewable energy strategies. Wynn and

MGM indicated the strategies for the utilization of renewable energy sources were their aims at

the reduction of their impact on the environment. Wynn Resorts, after leaving the Nevada

Energy utility grid, have recently developed their own solar facility, the Wynn Solar Facility.

The strategies not only affect the company’s position in the reduction of environmental impact

but also result to a reduction in their initial energy costs (Wynn Las Vegas, 2020). The facility is

expected to offset the company’s power requirements by 75%. Further, MGM resorts operating

one of United States largest rooftop solar arrays aims at powering 90% of the energy consumed

in the region during the day, through its Mandalay Bay off site solar farm (Schulz, 2019; Murren,

2020). Additionally, the MGM resorts developed waste management programs aimed at ensuring

a greener community. The Las Vegas Sands Corp, contributed in the adoption of better

environmental conservation strategies, such as ECO360 sustainability program and energy

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resources conservation by implementing the ECO-tracker projects. Through the projects, the

company achieved the salvaging of electricity and the adoption of green energy resources (Las

Vegas Sands, 2020).

Value Chain

The gambling business in the United States incorporates several activities through which

it adds value to the different contexts of the country, through production, marketing as well as its

after service provisions. Several Casinos including MGM Resorts, Wynn Resorts and Las Vegas

Sands Corp have various strategies in their value chain, stemming from their sustainability

efforts. In the wake of the year 2020, the world was faced with a never wrecking pandemic that

affected the position and capabilities of businesses, as a result, forcing multiple enterprises to

close their services in a bid to adhere to governmental regulations on controlling the COVID-19

pandemic. The casino companies based in Nevada, experienced the rampaging effects of the

virus, and as a result forcing most to adopt measures in order to keep afloat.

MGM Resorts, Wynn Resorts and Las Vegas Sands Corp derive most of their profits

from their gambling operations distributed across locations in United States and China among

other regions. Las Vegas Sands acquires most of its revenue from Macao and Singapore, which

is rated at 63% and 22% from the locations respectively. The companies regard Macao as their

major business hub in China and as a result of the impact posed by the Coronavirus, closure was

imminent, in adhering to the country’s regulations. However, with demands increasing the

companies were set to re-open their operations in the regions (Lahiff, 2020).

Since 2015, the companies, based in the Casino Hotel industry experienced significant

growth in their revenues. As states that had imposed strict regulations on the context of gambling
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loosened them in the United States, the companies experienced considerable growth, as well as

an increase in domestic competition. Macau, the companies’ major international hub provided

tax exemptions for new establishments in the region as a result, increasing the rates of

competition. However, there have been significant increases in the industry’s revenues for the

last 5 years. The annual growth rate is estimated at about 1.8% increasing the revenues to 66.8

billion annually for the industry.

In 2019, the revenue growth was estimated at 2.6% and an overall average industry

growth rate of 2% in the period 2015 to 2020. The three companies’ value chain stemming from

domestic to international markets, saw their operating revenues in 2019 records improve with

Wynn Resorts operating at $6.6 billion revenue, which one-third was acquired from its casino

enterprise operating at $2 billion (PYMNTS.com, 2020). However, with the spread of the

Coronavirus, travel restrictions imposed by the United States government and Chinese

governments are bound to cause a ripple in the revenue of the three companies. This is because,

since in the United States the companies’ major business hub is Las Vegas, which is dependent

on tourists from other states, will be affected due to the restriction. Thus, the Las Vegas

vacationing drop caused the companies to close most of their operations.

Macau being the companies’ central hub in the international markets trading in China,

poses a positive means through which they can improve their value, when the pandemic gets

under control. The flow of cash is a major factor in contributing towards this endeavor as the

businesses face trying times as a result of the Coronavirus. Therefore, through the generation of a

positive cash flow in Macao, Wynn Resorts, MGM and Las Vegas Sands stand a chance at

reviving their revenues. Further, online markets are not closed, thus presenting a better position

for operating during the indefinite closure.

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Summary

The Casino industry has experienced significant growth for the last five years since 2015,

with average estimates indicating a 2% growth in the revenue annually. However, this year,

uncertainty looms the markets with the growing spread of the Coronavirus and the impending

political regulations aimed at minimizing the spread. The Wynn resorts, MGM resorts and Las

Vegas Sands Corp, are among the affected companies. However, prior to the spread of the

Corona virus, MGM and Wynn resorts had experienced various law suits. MGM was sued for a

$800 million compensation by the public as a result of a mass shooting that took place in Las

Vegas, afflicting about 4,500 people. On the other hand, Wynn Resorts, was sued following a

sexual harassment claim in 2018, leading to a fine of $20 million. The political trends in the

companies’ operations affected their operations in different markets, both domestic and

international. Governmental regulations such as travel restrictions, and business closure to avoid

social gatherings, caused a ripple in the industry as the year 2020 kick started. The Las Vegas

Sands Corp, with operations in Chinese markets, got affected by the imposed regulations. H

Nevertheless, the companies have experienced socio-cultural trends that have shaped

their operations in the different markets. MGM resorts, in their different markets of expansion

have improved their sustainability and corporate responsibility through charitable donations and

partnerships with local women and minority businesses. Further, the business provided

employment opportunities to the communities of operation as well as promoting the value of

education. However, as people fear the spreading infection, the companies have been forced to

close their enterprises in different locations, thus affecting employment and the acquisition of

income among many of their employees.

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Environmentally, the companies in a bid to improve their contributions in the

conservation of the environment and reduction of their footprints in the context, have merged

into various strategies. Conserving water and energy and managing waste are among the

strategies towards this objective. Wynn and MGM engaged in renewable energy sources that are

focused on playing a role in the promotion of a green-ecosystem. Las Vegas Sands Corp also

plays a significant role to this effect by developing their sustainability program Sands ECO360,

through which various buildings have been constructed in Macao and other regions. Also, in

promoting energy consumption through renewable sources, Las Vegas Sands implemented the

ECO-tracker (Las Vegas Sands, 2020). Additionally, the companies through their value chain

have implemented several approaches to improve their production, marketing and consumer

benefits. Through online casino platforms the companies promote their position in the

competitive market, where digitization is rapidly taking form.

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References

Elinson, Z. (2018, March 23). Casino Surveillance Video Shows Las Vegas Gunman Days

Before Massacre. Wall Street Journal - Online Edition, 1.

Singh, K. (2020). MGM Resorts sued over data breach that possibly involved 10.6 million

guests. iTnews. Retrieved 28 April 2020, from https://www.itnews.com.au/news/mgm-resorts-

sued-over-data-breach-that-possibly-involved-106-million-guests-538454.