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Gaming Profile -- David Ross

Suncoast: Solid Plan Spells Success

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By Len Butcher

If you're going to build a resort in today's competitive Las Vegas, you better have a plan, the money, and most of all, know what the hell you're doing.

Fortunately for Suncoast Hotel & Casino, the newest addition to the local Coast Resorts chain, it had all three, thanks to successful, supportive owners and a savvy manager who had started his hotel/casino career as a valet parking attendant.

David Ross, vice president and general manager of the recently-opened Suncoast Hotel & Casino, is a happy guy as he sits in his office overlooking the green fairways of a neighboring golf course.

And why not? The property that he, as much as anyone, was responsible for planning and seeing it through to its opening, is doing very well, thank you. Since opening September 12 of last year, it's hard not to be pleased with its performance.

"From an ownership standpoint," Ross says, "I believe we've met expectations. From Wall Street, it's ahead of expectations." That doesn't mean that Ross is satisfied. His response to the success is, "I know we can do better, but I'm very proud of it and very proud of the team that has brought it this far."

Ross and owners Michael Gaughan and Frank Toti may be breathing a little easier now, but they had taken two major risks when planning the property. First was the location. The 50-acre site was adjacent to the ill-fated Regent Las Vegas on Rampart Boulevard in northwest Las Vegas.

Although Gaughan and Toti had a successful track record with the Barbary Coast and the off-Strip properties Gold Coast and The Orleans, the poor performance of the Regent Las Vegas (an elegant, upscale hotel/casino resort now in bankruptcy) hovered over them.

Secondly, and just as significant, was the decision to implement a "coinless" slot system known as "ticket-in, ticket-out." In other words, there would be no cash used in any of the 2,100 slot machines. Ross addressed both problems, as well as giving an insight has to how and why the Suncoast came about.

As for the failure of the Regent Las Vegas, Ross said they weren't worried because of it. "We were targeting the locals market, while the Regent is more reminiscent of Palm Springs or Scottsdale or Maui, where it's more of a resort."

With an approximate population of 350,000 people within a five-mile radius and some 50,000 cars driving by the site daily, the decision to build was not a difficult one, says Ross. Add to the fact Ross now had "two great business models for the local market, the Gold Coast and The Orleans, so we knew what we had to do at the Suncoast to be really successful.

"What we did was execute Michael Gaughan's business plan for the locals market, as 90 percent of our business comes from that market. What many people don't know," says Ross, "is that Michael and Frank Toti have been doing this for almost 30 years. Back in the mid-'70s, they opened the Royal Inn Casino on Convention Center Drive and introduced the first football contest. They also offered low drink prices and prime rib at great value.

"When they opened the Barbary Coast, they had one of the very few race and sports books in town so they continued to drive their local business through the Barbary Coast. When the Gold Coast and The Orleans were built, it was just a continuation of the local property mentality that the two men brought to the table.

"We needed to bring those amenities from the two properties and put them under one roof. We had certain things at each of those properties that the other didn't have, so what we did was bring all the great things from each property and put them in the Suncoast." That included bingo, which Ross says is a "terrific volume driver for the Gold Coast which we didn't put in The Orleans. We also had twelve movie theaters at The Orleans, but only two at the Gold Coast. The twelve were the most successful Century Theaters in Las Vegas, so we put sixteen theaters at Suncoast."

Ross said the plan was to put everything the locals wanted under one roof, from good food at great value to a child-care center for customers. He also wanted to make it user-friendly. For instance, Ross says, "We have bowling, bingo and banquets all in the same space, literally door-to-door. All of our restaurants are in a row. It's a very simple floor plan."

Those decisions were relatively easy to make. The next was not. While planning the Suncoast with owners Gaughan and Toti, and vice president of slots, Marcus Suan, Ross had seen some new technology, "a ticket-in, ticket-out system from IGT (International Game Technology is the world's leading manufacturer of slot machines) that they were willing to share with the different game makers." The decision now facing Ross and Suan was whether they were prepared to propose the use of this state-of-the-art technology to the owners. "Probably the main driving force in our decision to do it was to try and set ourselves apart from the competition in terms of customer service. This really was an expensive proposition, to test your entire organization against the unknown. It's a big risk.

"I remember meeting with Mr. Gaughan and Mr. Toti and asked: 'Is this the gamble we want to take?' The good thing is that we all believed this was the future of the industry and knew it would work." So what are the advantages for the customer?

The main advantage, Ross says, is that "You no longer have to wait for hopper fills. When you're playing multi-line, multi-coin games, it's very easy to empty hoppers. What happens is that the customer has to wait, and no matter how many people you put on staff, it's very hard to service a customer in an acceptable time.

"Now customers don't have to wait. Everything that goes with the handling of coins is eliminated. This system also gives customers great flexibility. They can move between games without waiting for hopper fills, or change. They simply hit Cash Out, take their voucher with their credits, and feed it into the bill validator on another machine."

Ross points out that it's also an advantage for those customers waiting for a table in one of the restaurants. "If there's a line-up, you leave your name to be paged and when the page comes, you can instantly cash out."

That doesn't mean they didn't worry about how this revolutionary system would be accepted. "A lot of the industry was watching us, and waiting to see how the customers would react. The good news is that when we talk to our customers, it's evident that this is one of the components they like most about Suncoast." What about cost savings for the casino with decreased handling of coins by staff?

Ross says there is no immediate savings, "simply because the hard cost, the cost of setting the whole system up and the cost of the technology, was very, very expensive.

"If we took a spread sheet and said we were going to amortize these costs over a number of years, once the conclusion of that comes, and not having to redo that in capital expenditures, there will be future savings."

Having better customer service and less down time on machine fills, says Ross, "is an unquantifiable measure of its success. For instance, if you come in here as a customer and 1,500 machines are being played, you would still be able to enjoy your evening and I don't know what that's worth. By allowing you to have this kind of experience, do we, as a business, retain customer loyalty?

"If you go down the street to another casino and have to wait a half hour for a hopper fill, are you going to ask yourself, 'Hey, why am I doing this? I'll go to Suncoast where I don't have to wait for anything.' We can't judge that right now, but I know there is a benefit to that. It's a win-win scenario for everyone."

One thing Ross knew was that they had to "hit a home run with customer service, We knew we couldn't let the customer down because we wouldn't be given a second chance." The result, he says, has been positive. "They like what we're giving them and we have to make sure we don't slip."

When asked if there were any difficulties in putting it all together, Ross says the hardest part of his job was getting a staff of 1,800 to understand the company's philosophies on customer service in the local market.

"I often use the example that it's hard enough to get our own families to cooperate, let alone almost 2,000 people who have never worked together." It's a demanding job that takes 75 to 80 hours a week of Ross's time. "Listen, Michael Gaughan and Frank Toti still work six, if not seven 10-hour days or more."

Ross's major concentration is "managing the managers so that they continue to educate our staff in customer service. You know that you're always going to have problems and that you have to work through them. I look at them as challenges and try to find solutions, without ever losing sight of the customer.

"I'm in charge of a $250-million asset and it's a tremendous responsibility. There are a lot of people counting on me, so I better do it right." As for his style of management, Ross says he believes in contingency management. "That means there's no one right way to manage every situation. There are times when you have to be tough, but also be able to pat your team on the back and say, 'Hey, you did a great job. I'm proud of you.' You better do that, because you have to work as a team. You can't do it alone. And you must treat people with respect."

So how did this 36-year-old hotshot get to be the head honcho of Suncoast?It all started in 1981 when he began parking cars at the Barbary Coast. His dad and other relatives had worked in the business so he knew at an early age what he wanted to do, and that was to work in the gaming industry.

Ross was fortunate to have three mentors - Michael Gaughan, Frank Toti, and Leo Lewis, all successful veteran gamers. Starting from the ground up, he went downtown to work for Michael's father Jackie as a craps dealer when he was old enough, then dealt blackjack, pai gow and baccarat.

"I literally worked every game in the casino, then worked every department as well. Michael Gaughan created a management program for me that was second to none." This on-the-job training included working a normal shift as a dealer, then working in another department once his shift ended.

Three years later, Ross went to Gaughan and Toti and said, "I want to run joints, guys. This business is what I love. I want to put myself on a program that in 10 or 15 years from now I can run a property. So that's what happened and it was concurrent with me getting my degree from UNLV."

The going wasn't easy. Ross was married, going to school, working two shifts. But the hard work and dedication paid off. Gaughan made Ross director of hotel operations of Barbary Coast, then sent him to the newly-opened The Orleans, in the same position.

Shortly after, Leo Lewis retired as vice president and general manger of Barbary Coast and Gaughan offered the position to Ross. At that point, Suncoast was in the planning stage.

When Gaughan and Toti decided to move ahead with Suncoast, Gaughan approached Ross and asked: "If you go to the Suncoast, what's the succession plan?" Ross told him that Gaughan's son, Michael Jr. was ready. "He's you to a T."

Ross says Michael Jr. had been coming up in the business. "He's a little younger than me, so I had moved him up, putting him into the positions I had held, like director of hotel operations. He's great with people, knows the business, and is currently vice president and general manager of the Barbary Coast."The next question Gaughan asked Ross was: "Are you ready to do the big one now?"

The rest, as they say, is history.