Tar Heel Tattler - March 2007

It's a lotto work for a little dough
By Frank Maley

In their first year of selling tickets for the North Carolina lottery, retailers are learning to leave little to chance. To get the games to pay off for them, they’re finding ways to turn losers into winners, even if it means peddling tickets for nothing to customers who buy something.

Barry Everhart, owner of Parker’s News in High Point, thought selling tickets and scratch cards was a sure thing. Sales started strong last spring when the state launched the games but withered during the summer. The result: Everhart says his 7% commission on ticket sales doesn’t cover his costs — which include having to pay for tickets he doesn’t sell within 21 days and hiring an additional clerk. But, he says, the games do lure customers who make other purchases.

He hopes a couple of promotions he’s running will people playing the lottery — and shopping. Since the games started last March, he has been holding a weekly drawing of losing tickets, with the winner getting $10 worth of new tickets. About three months later, he started giving five tickets to individuals or groups that buy $100 worth of tickets. Beyond that, he has made it a point to pay off winning tickets — even if they weren’t bought at his store. Though reimbursed by the state, not all retailers want to be bothered with that, he says.

At Quick Snack in Greensboro, co-owner Rishy Bisoondutt also has been holding weekly drawings of losing tickets. The winner gets $20 of gasoline. In early February, he was about to launch another promotion: a free ticket for those who buy at least $10 of merchandise other than gasoline. “It’s just another tool to bring a customer in your store, like selling money orders.”

Retailers aren’t the only ones stung by lower-than-expected sales. The North Carolina Education Lottery will gross just $1 billion in its first full fiscal year, some $200 million short of initial projections, Executive Director Tom Shaheen forecasts. Several factors have affected sales. Neighboring states all have lotteries, and North Carolina’s doesn’t pay jackpots as large as theirs. Some of Everhart’s customers still drive 40 miles to buy Virginia lottery tickets. Shaheen plans to raise payouts with money freed by lower-than-expected administrative costs.

And retailers plan to continue finding ways for the lottery to come up with some more scratch for them. “It’s going to be here to stay, so I might as well take advantage of it,” Bisoondutt says.