NEVADA COIN MINTING SUMMARY
NCM - History and Strategy.
NCM - History.
NCM is a private mint and was a market leader in the supply of coinage, gaming tokens, amusement tokens, transit tokens, commemorative coins and medallions to customers world-wide. NCM's assets are closely held by a single owner. NCM was started in 1984 by serving a few small Nevada casinos, and has grown to include a customer base covering the United States and countries throughout the world. The facility is located in 6,000 square feet of leased space in Las Vegas, Nevada from where it services a loyal worldwide customer base.
NCM's Strategy.
NCM's strategy has been to produce the highest quality product in the industry utilizing state-of-the-art graphic design, laser sharp die engraving, and the highest tonnage coining presses, that meet all of the specifications required for U.S. Mint production.
NCM's technology, expertise and reputation are the pinnacle of the gaming token and specialty minting industry.
The Products and Services.
Core Products and Services:
NCM offers basic and specialty coin minting and manufacturing services. In addition to coin manufacturing, NCM offers a coin destruction service which is mainly intended to obsolete and mutilate discarded tokens in accordance with various state gaming control regulations. This process utilizes custom-designed and manufactured portable, high speed machines.
There are several attributes that differentiate NCM's product lines from its competitors. NCM has not compromised its product quality by minting softer metals which typically have shorter useful lives and trouble-plagued performance in the casino's slot machines. Thirdly, NCM prides itself as the most innovative and quality conscious coin manufacturer in the casino industry.
Minting metals include precious and non-precious metals. NCM typically uses brass, nickel-silver, copper plated zinc, aluminum, silver and gold. All coins and tokens produced for the gaming industry are in strict compliance with the gaming control regulations of the approving jurisdiction.
NCM's innovations include two exclusive products, branded by trademark names of Kaleidocolor™ and Kaleidoprint™, which were developed to offer a new and exciting products to the casino table and slot market. These advanced technologies are the first and only durable full color gaming tokens designed for slot and table play. Kaleidocolor™ and Kaleidoprint™ are considered to be the next generation of gaming monetary devices and are beginning to obsolete standard tokens and coins.
The Kaleidocolor™ process applies a colored aerospace coating which can be applied to any coin or token to obtain stunning effects. The Kaleidocolor™ process is permanent and protects the design of the coin and enhances the useful life and appearance of the coin. This coating is available in over 800 stock colors and adds a smooth, clean texture to the coin.
NCM has found that the Kaleidocolor™ process adds a new dimension of variety and excitement to the casino. Customers like the Kaleidocolor™ coins because it differentiates the casino and the process makes the coin smooth to the touch. Casinos like Kaleidocolor™ because it makes their coins easier to sort from other casinos and many more customers take them home as souvenirs.
NCM's newest, most exciting and exclusive product is the Kaleidoprint™ product line which is built on the foundation of the Kaleidocolor™ product. Kaleidoprint™ tokens feature a very high quality full color image in the center of the coin, and are covered by a crystal clear aerospace polymer that protects the image from damage and offers an elegant glossy appearance. The full color image on the coin can be the customer's own artwork, photographs, logo, etc. The Kaleidoprint™ product line offers many exclusive value-added qualities such as:
· Extraordinary quality and consistency
· Proven product durability
· Fantastic eye appeal
· Difficulty to counterfeit
· Fully compatible with both slot machines and table games
· High color visibility for increased camera surveillance
· Completely non-toxic
· Will not harm machines
· Has no negative effect on token acceptor's performance
· Will not yellow with age
The Kaleidoprint™ tokens are exclusive and unique. These coins can be designed and produced for any purpose. These new exclusively produced coins are very popular and attractive. Since the introduction of these patented products into the casino industry in 1993, NCM has discovered that these product lines have unlimited applications such as collectible coin series, advertising and promotional products, and can be embedded into unique mounts for authenticity or aesthetics. The Kaleidoprint™ product line was built upon the foundation of our long-standing experience with Kaleidocolor™ tokens. Kaleidoprint™ coins have been so successful that these coins have replaced the Kaleidocolor™ coins in customer demand. Introduction of a new holographic form of Kaleidoprint™ tokens is now in the research stage.
The Kaleidoprint™ and Kaleidocolor™ products are proprietary property of NCM and protected under a multitude of patent, trademark and copyright laws and various trade secret agreements and procedures.
Market Diversification:
Commemorative Coins: NCM's commemorative coins and medallions include: sports coins, geographic commemoratives, historical commemoratives and holiday commemoratives.
Sports Coins: NCM has minted products for Quarterback Legends, the National Football League, baseball, the Professional Golfers Association, Deacon Jones, America's Cup. NCM entered into this marketplace and found it to be totally bereft of a quality supplier of coins, medallions and tokens. NCM has high expectations from this marketplace due to the rapidly increasing demand for sports related memorabilia.
Other Product Plans:
NCM also produces geographically related commemoratives such as coins that commemorate a state or city's centennial, national parks, and tourist attractions. NCM has produced coins for such places as Pike's Peak, Yellowstone National Park, Calico Ghost Town, Silverton Narrow Gauge Railroad Cripple Creek, Charleroi (Pennsylvania) and Knott's Berry Farm, just to name a few.
NCM had been developing a marketing plan for historical commemoratives such as national monuments, the old Catholic Missions, famous homes, etc. NCM planed to develop a holiday commemorative line of coins and Collectable Coins CardsTM that could be sold through gift shops and mass merchandisers such as K-mart, Wal-Mart, and Sears.
The Market - Evaluation of the market and competitors.
Overview.
NCM's customer base is large and includes both domestic and international customers. The casino gaming industry has historically represented the largest customer segment with orders representing both standard and specialty coins. NCM has done work for almost every major gaming establishment in the United States. The remainder of the customer base includes arcade, transit, commemorative medallions and medals. Respect that NCM has earned from its customers has enabled NCM to obtain non-gaming business with companies like McDonalds, Warner Brothers, PGA of America, and Knott's Berry Farm.
Competitive Analysis.
NCM has a minimal number of competitors at its level in the industry. They are:
· Osborne Coinage Company
· Hoffman & Hoffman
NCM established itself as the dominant mint in the gaming industry by creating products that other mints cannot produce at any price.
Primary market for products and services:.
NCM's primary markets are:
1) The legalized gaming markets of the USA and abroad. Major U.S. markets include riverboat gaming, cruise lines, Indian gaming and traditional casinos.
2) Commercial / Commemorative markets. These include
Tourist Attractions: San Diego Zoo
Calico Ghost Town
Disney
Corporate: Cereal boxes
For prizes or McDonalds Happy Meals
Keepsakes Beer packaging
Soda packaging
Negative Option Plans: Monthly coins
Bi-Monthly
Quarterly
Coins in conjunction with stamps, plates etc
Framed with a single stock share
Clubs: Motorcycles Ducks Unlimited
Fly Fishing Masonic
Car Clubs Pilots Assoc
Rotary Lions club
Fundraisers: Chamber of Commerce City Anniversaries
Charities St. Judes
Zoos Boy Scouts
Schools Metal detector hunts
Churches
Make A Wish
Breast Cancer
Conventions: Giveaways in packets commemorating event
Calling cards Given away at conventions by exhibitors as calling cards depicting their products such as a raised golf ball, brass screws, computer chips, etc)
State or National Parks Hoover Dam Black Hills
Yellowstone Grand Canyon
Retail Sales: Zodiac Misc. Occasions
Internet or Magic coins Ball markers
Advertising Good luck Heads n Tails
Coin Toss
Grand Openings Door Prizes $ off of first sale
Party Favors New Years Retirement
Wedding favors & Guest favors Invitations keepsakes
Corporate Incentives: Best grossing employee Employee
of the Month
Coin Dealers: Bullion coins Collectibles
Licensed Products: Disney Knotts
Coors Dodgers
Barbie Harley Davidson
Historic Events: Desert Storm Concerts
Museum openings
Operation Iraqi Freedom September 11th
Professional Fights Political events
Rodeos Ball games
Marketing on Television QVC Sales
Repeat Customer Sales: Casinos Role playing
Liquor tokens “good for” tokens
“free oil change” “free coin” with demo rides
Merry-go-rounds Parking tokens
Bus tokens
Home game use- Pachinko, slots
Board game pieces Food, drink tokens
Pony, train rides
Gaming Legal tender in casinos
Promo coins sold in gift shops
Home use slots
Home use for poker playing, card games
Armed Services: Squadron coins
Religious coins: Coins with bookmarks
Pocket or purse pieces
Union coins: Brotherhood of Electrical Workers
Sheet Metal Workers
Recovery coins: Alcoholics Anonymous
Narcotics Anonymous
Banks: Incentives for deposits
County Clubs: Golf Ball markers
Visitor Centers: Hawaii
California
New York
Pressed Product
Uses other
Than coins Insets on cigar boxes, pen boxes, gun boxes, sculpture bases
Emblems
ID tags
Key tags
Refrigerator magnets
Lapel pins
Sales and Promotion
NCM's products were promoted and sold through the following channels:
1. NCM attended major trade shows each year.
2. Sales people contacted old customers on a regular basis to maintain relationships and contact perspective customers to develop interest in NCM's products.
3. Advertising in major gaming magazines each month.
4. Direct market mailings in the form of the NCM’s newsletter that is was designed in-house to keep customers updated on NCM's newest products and changing regulations affecting the industry.
5. Brochures and catalogs sent out to everyone that contacts us.
6. Many satisfied customers, enthusiastic about NCM's quality and service, tell other people in the industry to do business only with NCM. (An extensive listing of customers is attached as an appendix.)
Internet Site. NCM maintains a comprehensive website which provides access to NCM's products and services to millions of internet users. This site enables customers and potential customers to access NCM to ask questions, request a price quote, place orders. The internet presence provides an access to customers that seek immediate knowledge and assistance with coin and token orders. The website can be found at http://www.tokens.com.
Manufacturing
Minting Machinery. NCM uses the highest tonnage knuckle and hydraulic presses to produce each order. These are the same presses used by the United States Treasury to produce coins and tokens and in some cases the presses were actually purchased directly from the various United States Mints. These presses are capable of normal high speed production as well as intricate proof coin production.
All in-service minting machinery is well maintained and not pushed to maximum production capacity.
Machine Shop Machinery. NCM can produce almost any machined part that is necessary for the operation of the minting process within its own computerized machine ship. Among the tools in the machine shop are a Computer Numerically Controlled (CNC) vertical machining center and fully digital lathe.
Die Cutting Machinery. NCM owns all the machinery necessary to produce two and three dimensional coining dies. These machines include 2D and 3D pantograph machines used for scaling and cutting artwork into the dies for fine detail work. In the current business configuration, die cutting is outsourced.
NCM uses its own heat treating furnaces to soften or "draw" metals, so that they are easier to strike. The heat treating furnaces are also used to harden coining dies so that the life of the die is extended thereby producing less wear and fatigue during the production run.
Coin Finishing Machinery. NCM owns specialty finishing equipment which customizes ordinary coins and tokens. NCM's gold plating equipment can be used for any application but mainly allows coins to be fully gold plated or selectively gold plated at the customer's preference. NCM owns antiquing machinery used to give the coins a rustic, old and circulated appearance. Specially designed Kaleidocolor™ and Kaleidoprint™ machinery are used to produce the exclusive colored coin products.
Packaging Machinery
NCM owns thermal forming, vacuum forming, and die cutting machinery. This allows us to produce our own coin blisters, skin sealed coin cards, and box inserts. This machinery will be used to its fullest in the production of Collectible Coin Cards™. We also have plastic bagging equipment that is used to individually package coins intended for retail sales such as recovery program medallions.
Token Destruction
Our token destruction machines are the first Gaming Control Board approved portable method of destroying old gaming tokens. In the past old tokens were thrown into cement, Lake Mead, or taken to scrap yards to be destroyed, which caused unnecessary expenditures of time and money to ensure that security was properly maintained.
With the machinery that was developed by NCM we can destroy approximately 900 coins a minute per machine in the casino’s cage, warehouse, or wherever is convenient for our customer. In addition, Independence Mint, Inc. gives the casino a check for the scrap material. Until NCM did this, even the scrap yards did not pay the casino for the coins because the charge for destruction was equal to the value of the metal.
NCM profits from destruction also. The metal that we destroy is then returned to the mill to be recycled for credit against our future orders. This can mean up to a ten cent break in the price of each dollar blank -- which allows for a substantial increase in profits. We have to date destroyed many millions of coins.
Art Department. NCM maintained one of the most sophisticated art departments in the minting industry and one of the most sophisticated art departments in Southern Nevada. Utilizing state-of-the-art hardware and software, NCM could produce the best artwork possible in the least amount of time. NCM is capable of accepting a wide range file formats for designs provided by customers.
Machinery Applications
There are many spin off applications that may be done with the equipment we now own. We could expand the manufacturing of wooden boxes that we have individually designed for our customers. For Legends Sports Memorabilia Magazine we developed a round wooden box cut with the company’s logo on the lid. Boxes could even be cut in special shapes. For example, they could be shaped like a football, Mickey Mouse, or Snoopy. A range of specialty shapes could be produced and marketed. We could make all sorts of thermo-formed products from box inserts for cosmetics to signage for gas stations. With our presses we can stamp other products besides coins, things like belt buckles, tie tacks, ball markers, stick pens, name plates and buttons just to name a few. With our blanking capabilities we can produce key blanks, face plates, cams, and specialty metal parts.
All our machining capabilities are now totally in-house. Just about every metal part that exists on our presses can be replaced and reproduced by the equipment we own at a substantial cost saving.