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LAS VEGAS, Nevada -- Major casino companies based in Las Vegas have expanded their presence along the Strip and beyond Nevada's borders. But they still look to local businesses to supply some of their needs.
The task for small businesses, however, has become a bit more challenging.
Mark Stolarczyk, vice president of corporate purchasing for MGM Mirage, who has spent 17 years in the gaming industry, said the days of small suppliers knocking on opportunity's door have long since passed.
Suppliers need to understand the varied needs of the different gaming operators, he said. MGM Mirage, for example, owns 10 Strip casinos in various customer markets, from the ultrahigh-end Bellagio to the budget-conscious Circus Circus.
"The first thing we do is encourage all suppliers to do their homework on who we are and what types of goods and services we provide," Stolarczyk said. "Some small suppliers will come to our door and ask what they can do for us. Immediately, they have eliminated themselves. It's up to the supplier to do their homework and come in with a plan."
Several companies questioned said they don't give total preference to Las Vegas-based businesses but just want the best product at a good price. All the major gaming companies have instituted diversity programs to ensure minority and women-owned businesses can compete equally for supplier contracts.
Rick Darnold, vice president of strategic sourcing for Boyd Gaming Corp., said suppliers must register through the company's Web site. An area has been set up where prospective vendors can list their company's information, goods and services and target the particular Boyd property they would like to work.
Darnold said the listing gives the company a clearer picture of their supplier base and a listing by product, region and other factors.
"We ask for a lot of information from a supplier because the more we know about them, the better chance we both have of finding a good fit," Darnold said.
But just because a prospective company registers on the Boyd Gaming Web site, doesn't mean the business should wait for a phone call. Darnold suggested want-to-be vendors continue interacting with the gaming company.
"From a small business standpoint, the more we know about them, the better chance they have," Darnold said. "They need to stay in front of our buyers. We have a company that's been talking to me for two years and we are now going through a bid in the category they have registered. The main reason they are in the process is they kept in front of us."
While Boyd Gaming has centralized all purchasing, MGM Mirage still allows some vendor-dealing to continue at the property level.
Both gaming companies suggested potential suppliers have a plan of action before entering the bidding process.
"They need to have their work done and come in with a plan," Stolarczyk said. "It gives them an opportunity. It doesn't mean they will get the business, but it puts them in the running. In some situations, we don't want to put all our eggs into a single basket so we'll use a couple of suppliers of one product."
If Darnold could offer one tip, it would be to not oversell what can be offered. Sometimes, a small business trying to get a contract, will bite off too much.
"In some instances, if a small business tries to service all our casinos in Nevada, it could kill them," Darnold said. "Our suggestion is to take a narrow rifle shot rather than a shotgun approach."
Even the major slot machine manufacturers look for help from local companies.
Industry giant International Game Technology handles the bulk of its equipment manufacturing internally at its plant in Reno.
But the Las Vegas office will contract out some of the reconditioning work for older slot machines.
Nevada Custom Cabinets, a North Las Vegas company, handles much of the work for IGT.
"It's very convenient for us because we don't use too many outside suppliers," said Lori Gotshall, an IGT production manager in Las Vegas. "We will have some unique needs that Reno can't fill, and we look to the local market for that type of work."
Former bellmen build a better doorstop
Brian Agster and William Hengler, two Mandalay Bay bellmen, spent two years designing and developing a doorstop that was easy to use, decreased property damage and was safer than the old-fashioned models.
Getting Strip hotel purchasing departments interested in their product was another challenge.
Today, bellmen, maids and guest room service personnel in thousands of Strip hotel rooms, including resorts operated by MGM Mirage and Harrah's Entertainment, use the Door Pro, produced by Vegas Doorstops, a business founded by the two.
Agster and Hengler have taken the doorstop outside of Nevada. It is being used at more than 600 hotels operated by Walt Disney World, Hyatt Hotels and the Marriott Corp. The next step is getting the doorstop in the hands of a distributor, which could place the product into 26,000 hotels and motels worldwide.
In 2005, the International Hotel, Motel and Restaurant Show in New York honored the Vegas Doorstops' device with the "Best New Product Award."
By the way, Agster and Hengler no longer work as bellmen.
"We're really too busy and that's a good thing," said Agster, the CEO of Vegas Doorstops. Hengler serves as the company's president. The Door Pro is manufactured in Las Vegas and distributed out of Las Vegas.
When the pair came up with the idea, they made the pitch to hotel purchasing departments. The company's success, Agster said, was in understanding the needs of hotel operators.
"If you don't have a product that is different and solves their problems, you won't get into these big properties," Agster said. "It was not only an amazing amount of persistence, but most importantly a great product that got us through the door of these big properties. You are not going to get any time with these buyers and purchasing agents without a fantastic product."
Mark Stolarczyk, vice president of corporate purchasing for MGM Mirage, was the first buyer to give the two bellmen a sale. He said their energy and creativity impressed him. He said the product made sense for use at MGM Mirage properties.
"It's not often that I meet a new supplier for the first time and become as impressed as I was," Stolarczyk said. "They had a professional presentation and a tremendous amount of enthusiasm and pride about their product."
Because of Nevada law, Agster and Hengler had to get the written approval of Mandalay Bay officials in order to patent the doorstop because it was developed while they worked at the casino.
"They signed off and told us to go make a million bucks," Agster said.
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