How Do Bookmakers Make Money; Your Guide To Bookmaking

How Bookmakers Make Money

A Bookmaker or bookie is someone or an organization that accepts or facilitates bets on outcomes of sporting events or other face-off events like political office elections at established odds. Many people think bookies place bets to generate revenue since they are the ones setting the odds. Well, that’s not usually the case since the business is a government-regulated one. Are you interested in knowing the money-making secrete of bookies anytime punters place their bets? Perhaps, you are interested in becoming a bookie? Then follow this short article on how bookmakers make money: your guide to bookmarking. 

Understanding Bookies

No doubt, sports betting is a bit like gambling. However, placing bets is not usually how bookmakers make money. They charge punters transaction fees on their bets. By compiling odds with an established, agreed, or built-in profit margin, the objective of a bookie is to take the range of available bets at the existing odds and guarantee returns regardless of events’ outcomes. 

Furthermore, bookies also lay off bets or spread risks when the liability or amount to payout is above the accepted level of exposure. The bookies’ job is a government-regulated activity. The level of regulation is dependent on the state or country. 

Types of Bookmakers.

Before the Internet age, bookmaking used to be a service supplied over the telephone, at a licensed office, or the sports or event centre, like the racecourse. Thanks to the Internet, bettors, punters, or bookies’ customers now have the option of choosing different ways to place their wagers. 

What’s more, free racing tips and other sport betting tips are a click away. Because of these multiple betting avenues, there are three types of bookmakers. Based on these, you’ll understand how bookies make their money more.

Fixed odds

Fix odd bookmakers will offer odds on all the possible outcomes of an event. e.g., the outcomes of a football match are home-win, away win, and a draw. With this simple calculation, you can determine a bookies profit: 100/(A + B/B)%

Therefore, a football match example with 11/10 home win odds, 5/2 away win off, and 9/4 draw odd. 

Home: 100/(11+10/10)= 47.62%

Draw: 100/(9+4/4) =30.77%

Away  100/(5+2/2) =28.57%

Total= 106.96%. 

In this situation, the book is “over-round” as the total is above ground. The horse’s excess, i.e., 6.96%, is the bookies’ profit. 


Spread bookmakers issue a spread and punters bet on an outcome that is high or lower than the spread. E.g., bookmakers can spread the number of goals in a soccer match from 3.1 to 3.3. As a punter, you may predict that there’ll be less than 3.2 goals or more than 3.3 goals. The bookie will make money from the difference between the stakes and the amount paid as reruns to bettors. 


Exchange bookmakers use the bettors who bet for and against an outcome the betting odds of a game. Bookies make sure the back price is lesser than the against or lay price. Exchange odd are usually expressed in decimal. Here, bookies don’t profit from the outcome of the event but from commissions charged on winning bets. This way, bookies make a profit irrespective of the game’s outcome.