Wynn Resorts Essay
Wynn resort is a public listed company that is based in Paradise, Nevada. Started in 2002 the hotel usually deals with high end hotels and casinos. This paper will evaluate the role of the owner, Steven Wynn in the operations of the resorts, the powers that he holds in the actual running of the hotel chain. It will also assess the outcomes that may arise if the owner, Mr. Wynn leaves the company, what would be the repercussions of when this vacuum is created by his exit. This paper will also focus on the strengths and weaknesses of the strategy for the hotel chain based in Macau PPC. Finally the paper will also address measures that Wynn’s management should take to ensure that that its main sources of revenue, Wynn Las Vegas and Macau continue to be profitable.
Role of Steven Wynn on the Wynn Resorts Operations
Mr. Steven Wayne remains the largest shareholder of Wynn resorts which he bought in 2002 after selling Mirage his other hotel company. Currently Wynn occupies the position of Chief executive Officer for Wynn Resorts Limited since he bought in 2002. He has also occupies the positions of Executive Director for all Wynn subsidiaries and branches. He sits as the chairman in the board of directors for the resorts meaning that he has powers to influence company policy and projects. He is also the chairman and chief executive officer CEO of Wynn resorts Macau.
These positions that Wynn occupies in the company’s executive both locally and internationally, imply that Steven plays a huge role and influence in planning process, investment decisions and also expansion strategies. As the majority owner he has the right to vote and participate in any company decision. It is important to note that Mr. Wynn was previously engaged in private entrepreneurship and is identified as one of the pioneers of the second economic boom of Las Vegas playing an important role in the expansion of the airstrip. His business sense was driven by vigorous campaign as he tried to expand his business empire. This same drive explains most of Wynn resorts policies and strategies meaning that Wynn still pulls almost all the strings in the decision making process (Bradsher, 2012).
Leadership vacuum after Wynn exit
As discussed above, Mr. Wynn plays a very huge role in the management and decision making process of Wynn Resorts powered by his position as the chairman of the board of directors, CEO of the local and international branch in Macau and also his role as the executive director. In case Mr. Wynn exits from all executive positions at the firm, then there is the likelihood of a change in the company’s strategies in areas regarding operations of the firm and also expansion strategies (Palmeri, 2009). It is hard to find a CEO with the guts to invest in unknown territories as Mr. Wynn did. The successor will probably scale down on Mr. Wynn’s vigorous expansion strategies even in areas or environments that pose a risk and which does not guarantee return on capital. Lack of aggressiveness will largely make the resorts to stagnate leading to reduced earnings.
The strengths and weaknesses of Wynn’s Macau (People’s Republic of China) strategy
The Wynn Macau location in an area with demography of more than 1.2 billion has proved advantageous as there is a large market for the resort’s casino and boutique hotel services. The advantage is that Macau is the only region in China where gambling is legal, meaning that all gamblers in China assemble in the region bringing brisk business for Wynn resorts (Chris, 2011). Macau was also an important alternative to the Nevada main branch in its location on one of the fastest growing economies in China. There is a growing middle class in China numbering millions who have an appetite for luxury which Wynn Macau will provide. The company’s strategy has been to price its products for this high earning segment with its luxurious hotel rooms and 5 star casinos. The main weakness for the strategy is the pricing strategy which targets high earners yet the Chinese economy is showing signs of depression and stagnation which may make it harder for people to afford Wynn Resort’s services.
How to Ensure Improved Profitability for Wynn Macau and Las Vegas
Wynn Resorts is a market leader in the casino and boutique hotels, one aspect that the resort should maintain is its continuous improvement of its services and investing in new technologies and security systems to ensure its services are quality. Keeping and continuously standards of service is a definite way of maintaining and attracting more clientele in Vegas and Macau.
The other important aspect that the company should concentrate on is its pricing. It is important to that pricing of services take into consideration the current economic situation. In both locations, Wynn has a very high price for its services (Sieroty, 2012). It should try to create segments for lower spenders and provide them with tables; this is a sure way of attracting more clientele and thus revenue. The third aspect that Wynn should focus on to maintain and increase business is to continue investing in facilities with alternative revenue channels such as 5 star hotels, restaurants, conventions and shopping malls. These avenues play an important role of complimenting revenue from gaming activities.
Bradsher, K. (2012). “Wynn Resorts Partners Split, and Accusations Fly”. The New York Times.
Chris, H. (2011). Wynn Success in the Chinese Gambling capital.Macau Daily Times.
Sieroty, C. (2012). “Okada wants court to stop stock seizure; Wynn says game over”. Las Vegas Review-Journal.
Palmeri, C. (2009). “The revenge of Steve Wynn”.Bloomberg Journal of Finance.