Is The Philippines PCSO Lotto Agent Business Profitable?

To have a deeper look into the PCSO Lotto Agent Business, I conducted a series of survey, research and interviews to find out whether this business model was economically feasible or not. The data was collected through deep researching for the lotto agents and some times making few phone calls for interviewing the lotto agents and general public.

Key Findings

  • Minimum, the PCSO lotto outlet has to generate PHP 15,000 in revenue.
  • On Average, the lotto agents generate PHP 25,000 in profit.
  • 60% of the lotto agents were happy with their business, remaining were not.
  • Manila and Cagayan proved out to be the ideal location for lotto agents.
  • Lotto agents generating above PHP 50,000 were mostly in Manila, with ideal display location in malls
  • 20% of the lotto agents got the bonus amount once in a duration of two two month
  • On average, lotto agent can expect PHP 1500 every month in term of bonus amount.
  • 60% Lotto agents do it by themselves along with two more sales people. It’s their primary source of income.
  • 60% are lotto agents because of the safety of this business model, 30% are in this due to the economical stability while 10% are here for other reasons.
  • Almost every Filipino is interested in lotto, at a single time there are almost 30 people in a single line ( Manila, lotto booth ) { is gambling ruining your life? Click here to seek help with Gamblers Anonymous }
  • All the Lotto agents are open from 7 am to 8 pm.

Listen to PCSO lotto outlet Case Study

Detailed Findings
For the details of each of the key finding, you may continue to read down below.

Introduction

In Philippines, the lottery/lotto is governed by a governmental body known as the PCSO ( Philippines Charity and Sweepstakes Office ). They offer a variety of games with different odds and prize structures. Their popular games include Swertres, Ez2, Lotto, 6/42 and STL Lotteries. While others are highly played, these are benchmarks for their progress in this area of practice.

PCSO works like this ( I am not talking about lotto agent licensing, instead how they handle it all )

  • PCSO offers 55% Lottery Payouts
  • 30% Goes To Charity Funds
  • 15% Is Kept For Operation and Administration

A payout ration of 55% is certainly not bad but it’s not good either. While most of the lotteries stand between 50%-70%, the PCSO lotteries and lotto make up to the minimum mark i-e 55%.

1- Minimum, the PCSO lotto outlet can generate PHP 15,000. 

Let me give you an estimate of how much you would be generating as of revenue perspectives.

This was to show you how much minimum amount you would be generating with your lotto booth. It should be noted that this criterion mentioned above is the minimum. Your earnings depend upon the sales as you get 5% commission from all the sales you make. You can make 50,000 worth Peso sales and get a commission of 2500 Peso in a single day.

To operate a PCSO lotto booth there is a certain threshold of sales you need to keep regulating for your lotto booth to stay alive. It varies differently with in different cities but usually it’s around PHP 300,000 to PHP 600,000. Even if you are generating sales to keep your lotto booth alive, you are still generating PHP 15,000 to PHP 30,000 in terms of revenue.

2- On Average, the lotto agents generate PHP 25,000 in Profit.

To get an average of how much do lotto agents earn on a daily basis, I studied the lotto profiles of few agents. There was a lotto outlet on Luzon that made PHP 100,000 in a single month [link] and there was this outlet who was in consistent loss ( A fellow of Mark Abellon – One of the information providers for this case Study). Upon average inspection, it appeared the lotto agents on average generate PHP 25,000 in profit.

Most of the lotto outlets performed better when the jackpot was high but the rent and staff took a considerable portion of their earning. Most of the successful lotto outlets were operating on a rented land of around PHP 20,000 – 25,000 with 2 workers. All that costs around PHP 60,000 – PHP 70,000 on max. The remaining is your profit ( the bills and all are included in the rent ) so you can expect a PHP 30,000 profit. On the other hand if you are dealing with the lotto outlet all by yourself ( meaning its a family business ) then you don’t have to pay for workers and you can earn up to PHP 70,000 in a single month. That’s a considerable amount.

3- 60% of the lotto agents were happy with their business, remaining were not.

We simply cant come to some sort of conclusion without getting our heads cleared for this one. There is no specific answer for this one but by asking few, I was able to understand whether it’s good o bad.

As for the lotto agents who were happy

While the sad ones had their own part

The survey data showed mixed result but the number of those contended lotto agents was higher than the one’s in loss.

4- Manila is the ideal location for Lotto Agents

Most of the lotto agents are operating their lotto terminal in Manila, primary reason being the high foot traffic. One more reason is the bonus amount ( The commission a lotto agent receives if a winning number is from their stall ). In Manila, a lotto booth on appropriate location faces enormous sales which result in a a lot of winnings. It’s the PCSO’s policy to give a certain percentage of the winning number to the stall from which it was bought.

That way, a lotto agent can keep selling lotto tickets with a fixed commission and on every successful winning, they still get another percentage of that winning amount. So the streams of profit in the business is not just the commission, but the winning numbers do bring a handful amount of commission that can be a blessing for the lotto agent.

Besides that, Manila is a dense place. If the lotto outlet has such an ideal spot that it receives tremendous foot traffic, it can result in a lot of sales.

5- Lotto agents generating above 50,000 PHP were mostly in Manila, with ideal display location in malls.

The average profit of the lotto agents is already discussed above, however I decided to highlight those who were making above PHP 50,000 per month and inquired their specific strategy that would better help me in evaluation.

Those of the outlets who were producing more than PHP 50,000 per month had these following qualities in common,

  • All of these were in an area which was experiencing high amounts of foot traffic all the time. The outlet which I personally looked at as a success model was generating the sales of PHP 700,000 per week and it was located in the mall – an ideal location
  • The lotto outlets succeeding over PHP 50,000 were ideally located so that they were the only ones to face the lotto sales – no competition nearby was present.
  • Those running the business as a sole property owners and running it as their primary business were not doing too good at it. Consider the outlets of this Business Tycoon [link], this person had a lot of of lotto booths and was able to run them all with great profits.

6- 20% of the lotto agents got the bonus amount once in a duration of two month.

Bonus Amount ( The percentage a lotto agent receives on a lottery winning amount ) is one of the major influencer on this business. While it cant be taken into account as no one knows exactly how much it’s gonna show up but it’s a game of chance for the lotto agent.

Since bonus amount is a major influencer behind the lottery agent business model, I analyzed how much of an impact does it have and exactly what percentage of this bonus amount does a lotto agent can receive. Here is what I got

It is clear from the lotto experience of this fellow, that those who win; are addicted to the same lotto outlet. So if you are successful in selling a ticket which wins, not only you are going to receive a bonus amount but also a passionate customer who is coming to see you again and again.

While the data is the absolute bearer of good news, it doesn’t happen too often. Out of the five outlets I analyzed, only this was the outlet which got the bonus amount in a duration of two months. Bonus amount is difficult to grasp on at times.

7- On average, lotto agent can expect PHP 1500 every month in term of bonus amount.

Since bonus amount was a major factor in the decision of the lotto agent, it’s important to make a rough estimation for how much of the money can be generated from this. From the data, it shows that a lotto agent on average can consider a prize money of PHP 750 per month from the winnings made by others. The amount fluctuates heavily, the reason is already explained above.

8- 80% Lotto agents do it all by themselves, it’s their primary source of income.

For those who were not sure whether to adapt lotto agent business model as part time or full time, I collected the following information that might help. Out of the lotto agents I ended up asking information, 80% of those were doing it as a full time business. They received training from the PCSO and were doing the day to day dealings as well as the business management all by themselves.

9- 80% are lotto agents because of the safety of this business model, 20% are in this due to the economical stability.

Beside profit, there are certain other factors which decide the worthiness of a business model. Just like every other business out there, there has to be few reasons that make people adapt this PCSO lotto agent business. It was seen that most of the lotto agents were running this business because they believed ” It’s a government business, it’s not gonna suffer “. Because of the linking of this business with the Government bodies, the majority was following the suite. Few of the people believed Filipinos believe in lotto all the time, so they had this opinion of lotto never facing a demise in Philippines

10- Almost every Filipino is interested in lotto, at a single time there are almost 30 people in a single line ( Manila, lotto booth ).

It’s important to estimate the total number of visitors a particular lotto booth can receive, that would help in the estimation. To get the stats, we had a citizen of Philippines, sharing her Insight. Before we share the insight, lets say thanks to ” Dyowanuuuuh ” for helping me collect the data.

Well, the data reported shows how much of a potential out there is in being the lotto agent. It depends upon how much the people are going to bet but generally when the lotto jackpot is sky high, people don’t mind doubling the bet amount. They can increase it to 10 folds even, all you have to is to win the right moment.

11- 80% of the Lotto agents are open from 7:Am to 8:20 PM.

It’s important to understand the time frame in which the lotto agent can generate profit. A lotto agents can’t be 24/7 available as there is a certain time limit set for them on which they can operate the system. To take a deeper look, I analyzed some lotto agents and the impact of time of business hours on their profit.

Most of the lotto agents are open from 7 am to 8 pm on average. Some of the lotto agents were open till 8:30 pm but considering the average, it’s 8 pm.  Regarding the customers, ” You rarely get a player after 7 pm “, so with that it’s safe to assume that going beyond 8 pm wont help. The business hours are 13 hours for this one. If you do it all by yourself then its gonna be feasible at the start, for hiring someone, you may expect to pay a decent wage which can temporarily drop your profit but eventually would come in handy.

Conclusion

  • The PCSO lotto business is totally legit. It has its own good and bad parts.
  • It’s ideal for those who are comfortable in steady income.
  • If you wanna get rich from it then it wont help.
  • The only way to get rich with it is to own large amount of lotto outlets. That way the bonus amount and commissions can add up significantly.
  • It’s a good source of a middle income.

I would to hear your experience as a lotto agent, feel free to share it in the comment section below.

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