Interview with Paul Gauselmann

"Our focus is on our employees, so we cannot abandon them now"

"Our focus is on our employees. They have worked faithfully for the company for years and we, therefore, cannot abandon them now. Their jobs must be kept if at all possible," Paul Gauselmann said.
Reading time 4:20 min
The Founder and Chairman of the Management Board of German-based group delved into the impact of the coronavirus outbreak and revealed that although production is currently largely at a standstill, their development teams are continuing to work on new products and, in light of the recent regulation of iGaming in Germany, on the Group’s future participation in the online business. “Our development departments are working flat out on this issue,” he assured.

Could you detail the different consequences the COVID-19 pandemic has had on the Gauselmann Group and the whole gambling sector?

The consequences of the coronavirus are affecting the entire sector, both the industry itself and the operators in the arcades and pubs. All arcades and casinos in Germany and Europe are closed and almost all pubs also. The Gauselmann Group alone had to close over 700 branches throughout Europe, with revenues falling to zero.

Which were the first changes your company had to implement in the wake of the coronavirus outbreak? What can you tell us about the results of your current approach so far?

If a company is no longer there, then it can no longer receive any help. Therefore, the first line of action is immediate crisis management. Our focus is on our employees. They have worked faithfully for the company for years and we, therefore, cannot abandon them now. Their jobs must be kept if at all possible.

The way to do this is short-time work. We have put almost all 14,000 employees on short-time work. Our Sales and Production divisions are also affected. The state will refund us in part and, where hardship arises for employees, we have decided to pay top-ups. Given the size of our company, that is a huge load that we are bearing, not only for solidarity reasons but also to secure the future of our company.

Although production is currently largely at a standstill, our development teams are continuing to work on new products so that we can offer players the best games and cabinets in the future also.

What is your opinion about the measures adopted by the different governments in the markets you do business? Have you received any financial aid?

The quick and far-reaching decisions in Germany were entirely correct to ensure comprehensive care for sick people. This succeeded well in Germany, but unfortunately not in many other countries.

The state has put together an enormous rescue package so as to prevent as many companies as possible from going insolvent. The order of the day is for each one of us to use all of our strength to get benefits and supports from the state that are necessary for economic survival. The state can and wants to provide an unlimited amount of money to partly close income gaps that are already opening up now and to do so where it is particularly necessary. That gives hope.

Do you think the customer behavior tendencies expected for 2020 and beyond will change in any way?

When we have survived this crisis, people will be happy to get out of the shackles of the restrictions and be able to enjoy life again. What they will need then is our entertainment offering. People will expect a choice of games from us as if there had never been any crisis. Therefore: In all of our thoughts about how we ourselves can get through this and survive, we cannot lose sight of the fact that, in an industry such as ours where we are so closely interdependent, consumers will not be able to manage in the long run without great new products from our industry. This means that, both in the industry and in the community of operators, we have a great responsibility while practicing mutual respect.

The course was set by the prime ministers of the federal states on 12 March, three days before the arcades closed, which means that at least the future of gaming is regulated both for us and also online for Germany, and is not wildly and illegally imposed on us online from abroad, as has been the case to date. I am certain that amid all the new laws – especially the transition from illegal to legal under German law – our business will continue to endure, as we have seen from our experiences in the United Kingdom. Illegal online competition caused us a lot of bothers. It will now remain in place “legally”, with the additional effect that we will also participate in the online business. Our development departments are working flat out on this issue.

Are there any bright sides to this situation? If so, could you detail them and explain how your company and the industry could capitalize on this experience?

After more than 60 years as an entrepreneur, things can be thrown at me thick and fast but that does not bowl me over. I have developed my own special method: I specifically search for the good aspect of the bad thing that has happened. And I always find that bit of a silver lining. I initially suppress what is bad and only work through it after several days, weeks or even perhaps months – according to the following motto: There is nothing so bad that it also does not have its good sides. This makes difficult situations easier to cope with.

Are there any similar situations (whether an economic or any other type of crisis) you or your company have experienced that you think can relate to the difficulties that the industry is currently experiencing?

What happened to the world and us in Germany and also our industry, especially from 15 March onwards, is unprecedented, not easy to comprehend, and is a cause of anxiety for most people – ranging from concerns about the future to survival fears. It is an existential challenge that some politicians are comparing to a war. I was a teenager in the years after World War II. I saw how the war literally reduced the country to debris and ashes. I stood in the rubble of my home town of Münster and had to improvise daily.

We need to keep the right perspective here. The pandemic will not reduce our country to debris and ashes. Corona will force us to accept losses. We will have to strive and improvise to survive economically. The situation will sooner or later demand an enormous reconstruction effort from us all. But: We will ultimately come through this stronger.

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