How to Be a Bookie
Sports betting in the United States alone is a multi-billion-dollar industry and growing in revenue every year. Advances in internet technology and sports betting software have fueled this growth over the years. Along with sportsbooks in land-based casinos and racetracks that are located in states with legal sports betting, big commercial online sportsbooks continue to cater to the US market.
Even with the recent proliferation of sports betting in certain states and a large number of online commercial betting sites, the private sports bookmaker still accounts for almost two-thirds of the revenue generated on sports betting in the US. This creates a very lucrative business opportunity for anyone looking to run and manage an independent sportsbook.
Just like placing a wager at a casino sportsbook or at a commercial online book, a private bookie acts as the House guaranteeing payment on a winning bet. They also collect funds on losing bets. In the role as a private bookie, upfront cash reserves will be necessary to cover all the weekly action taken in. Bookies will also need an operating system that can track those bets.
The primary way that any bookie makes money is on their ‘hold percentage’. This is the difference between the money paid out on winning bets and the money collected on losing bets plus the standard 10 percent commission. That commission is also referred to as the ‘juice’ or ‘vig’ owed on a losing wager.
The goal of any bookie is to balance out the money wagered on either side of a game. This way, the hold percentage would be the full 10 percent. In reality, a bookie usually walks away with around five percent given that bettors tend to lean heavily towards favorites. Upsets are a bookie’s best friend with a hold percentage much higher than the 10 percent standard juice.
Running a Bookie Business
There are a few things needed to successfully start and run a private bookie operation.
At the top of that list would be:
- Cash reserves to cover weekly action
- A group of active betting customers
- A computer software system to process online transactions
The first two items on the short list are self-explanatory. The third is a bit more complex, but fortunately easy to solve. When the first offshore sportsbooks first started booking bets on the internet, they developed a software system to take their business online. Following in those same footsteps, other companies developed similar online sports betting software solutions that allowed private bookies to offer their bookmaking services online.
Since it would be cost-prohibitive to try and create an online operating on their own, the private bookie was now able to gain easy access to these online sports betting software solutions at a much lower cost.
The ‘Pay Per Head’ Bookie Software Business Model
Private bookmakers looking to automate their business gave rise to the Pay Per Head industry over the past few decades. The business model of any pay per head service charges a low weekly price per head fee for a bookie’s active betting customers.
If the bookmaker has 100 active betting customers each week and their pay per head fee is $10 a head, the weekly operating cost would be $1000. Given the overall cost of trying to duplicate these service on their own, a quality pay per head bookie software solution is actually a low-cost way to create a very lucrative business opportunity.
Pay per head bookie software is designed to process all the daily transactions that go into a business of this nature. It can basically handle the entire operational end of a private book, so the bookie can spend their time on the sales and marketing side of the business.
A few or the primary features of pay per head bookie software solutions include:
- A turnkey business system for booking sports bets
- An online application that can be customized to specific business needs
- Fast and easy access to sharp betting lines for more than 80 different sports
The Art & Science of Running a Bookie Business
With the proper tools in the box, a private bookmaker can build and grow an independent sportsbook that can meet, and many times, exceed financial expectations. The most important business decision any bookie will have the make is which pay per head service best meets any specific business needs. Fortunately the choices run deep given all the recent advances in online sports betting technology and software packages. However, due diligence is still needed to make the right decision right out of the gate.
The other important business decision a private bookie needs to make is the makeup of a sports betting customer base. Some bookies are only interested in working with recreational bettors that are rather predictable in their betting style, habits and strategies. Since it would take quite a few recreational bettors to deliver solid bottom-line profits, the quantity of customers is the top priority.
Other bookies are looking for home run hitters. This bettors may hit a few big bets out of the park, but they also swing big and miss quite a bit. This could be considered a quality approach since a smaller quantity of big bettors can generate some big profits to the bottom line.
Working with the right PPH service, a bookie can accomplish the plan in place to find and expand an ideal customer base while also increasing the overall weekly handle through a built-out betting board. The addition of a custom website that creates a highly professional online presence will not only level the playing field against the big online commercial sportsbooks, it will become the strongest marketing tool in the box for promoting business growth.
Running a Successful Bookie Business
Making money in the short term is great. However, the proper planning along with the right pay per head business support is essential to creating a bookmaking business that can deliver lucrative profits over the long haul.
Even with a top-notch pay per head site covering the operational end of the business, successfully running and managing an independent sportsbook is hard work that requires a high level of dedication to the craft. The goal is to always stay way out in front of things to take full advantage of opportunities as opposed to falling asleep at the wheel and being forced to constantly put out fires.
Another important aspect of running a successful bookie business is creating multiple streams of revenue. As part of the weekly per head fees paid to a PPH service, a private bookie has access to wide variety of sports betting options that can expand the overall weekly handle. They can also operate their own racebook for betting on horses as well as an online application to run a full-service casino with slots, video poker, other electronic games and table games.
Becoming a private bookie as never been easier and the customer demand for this service is at an all-time high. With a quality pay per head service acting as that silent business partner, the blueprint to success in this business is already in place. Proper planning, commitment and hard work are the intangibles that brings everything together for long-term success in this profession.