BuSiNeSS PlAN - California Lottery

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Figure 1.2 – 2004–05 K-12 Percent of Lottery FundExpenditures by Category*Salaries and Benefits 64.9%Books and Supplies 19.2%Services and Operations 13.1%Capital Outlay and Other* 2.8%* As reported by the California Department of Education1.3 Distribution of FundsFor every dollar the CSL receives in sales, it returns approximately 88%to schools and players. The Lottery Act only requires the CSL to return84%. Figure 1.3 details how lottery dollars are spent.Figure 1.3 – Allocation of CA Lottery Revenues FY 05/0654%34%12%The CSL uses just 12% ofthe allowed 16% of ticketsales to cover its operatingexpenses, with mostof these costs dedicatedto retailer compensation.Prizes Education Operating ExpensesThe CSL is allowed to use 16% of ticket sales to cover its operatingexpenses; however, through efficiency efforts, the CSL has reduced itsexpenses and only uses about 12% of the money made from ticket salesto cover administrative expenses. It should also be noted that the largestsubcategory of administrative expenses is retailer compensation. 4% ofadministration expenses are allocated to prizes. Figure 1.4 shows howthis 12% was spent in the 2005-06 fiscal year.California Lottery 2007–2010 Business Plan – –
Figure 1.4 – Detailed Breakdown of the AdministrativeBudget FY 05/062%6.7%1%1.2%1.1%Gaming ContractorsPersonnel ExpensesRetailer CompensationAdvertising and CommunicationsGeneral Operating Expenses6.7% Retailer CompensationRetailer compensation includes all money paid by the CSL to retailers assales commissions and cashing bonuses. In the 2005-06 fiscal year, thetypical CSL retailer had ticket sales of approximately $14,500 per month,and received associated compensation in excess of $1,000 per month.2.0% Gaming Contractors CostsGaming contractors costs include payments for the operation of thegaming system and Scratchers ticket development and printing. Alsoincluded within this category are costs for distributing Scratchers ticketsto retailers.1.0% Advertising and Communications CostsAdvertising/communications costs include television and radio advertising,retailer point of sale materials, internet, billboards, and retailer andconsumer promotions.1.2% Personnel CostsPersonnel costs for employee salaries and benefits.– –California Lottery 2007–2010 Business Plan
Page 3: CommissionersJOHN MASS, of Los Ange
Page 6 and 7: Introduction
Page 8 and 9: IntroductionIn order to fulfill the
Page 10: focus on huge jackpots and more foc
Page 16 and 17: 1.1% General Operating ExpensesGene
Page 18 and 19: SupermarketsAlthough supermarkets h
Page 20 and 21: handles all Spanish language advert
Page 22 and 23: Fantasy 5Value Proposition: The bet
Page 24 and 25: 1.6 Organizational Structureof the
Page 26 and 27: ITSD consists of four offices and t
Page 30 and 31: Integrity,Security,Honesty,and Fair
Page 32: The CSL not only employsinternal au
Page 35 and 36: Since its inception, the CSL has wo
Page 37 and 38: Last year, the California Problem G
Page 39 and 40: Marketanalysis
Page 41 and 42: EthnicityThe following charts show
Page 43 and 44: GenderThe household incomeof past m
Page 45 and 46: 3.2 Consumer ProductSales Compariso
Page 47 and 48: Technology TrendsAll of these techn
Page 49 and 50: are large, to maintain sales in lot
Page 51 and 52: IntroductionIn FY 05/06, the CSL re
Page 53 and 54: Figure 4.2 is a list of some of the
Page 55 and 56: Figure 4.4 - Overall PRIZE PAYOUTS
Page 57 and 58: Figure 4.5 shows that in terms of p
Page 59 and 60: Raffle GamesRaffle-style games are
Page 61 and 62: Pursuant to section 8880.64 of the
Page 63 and 64:
Fig. 5.12 CSL Scratchers Game Growt
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As shown in Figure 5.13, the lotter
Page 67 and 68:
Fig. 5.15 Sales per RetailerFigure
Page 69 and 70:
etailers with special “Check-a-Ti
Page 71 and 72:
Gaming System ComplexityThe CSL’s
Page 73 and 74:
Fig. 5.19 Budgeted Per Capita Adver
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There is an opportunity to reverse
Page 77:
Public Relations and OutreachOur fr
Page 80 and 81:
Ticket Dispenser RestrictionsThe re
Page 82 and 83:
IntroductionA careful analysis of o
Page 84 and 85:
Unfortunately, increasing jackpot s
Page 86 and 87:
Key StrategicInitiatives
Page 88 and 89:
Shift the Jackpot ParadigmOur strat
Page 90 and 91:
12. Recruit Non-traditional Retaile
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www.calottery.com600 North 10th Str
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