How do you build a great membership in a club?

[Bill_McBride]

Adrian said, "Guest and Green fees make up a big percentage of the courses I have been involved with, most UK courses are open to all."

That's the big difference, our private clubs (not 'semi-private,' of which there are many) are not open to all in any respect unless a member invites a guest.  Just a completely different model which may have to change in the environment we are in and will be in for the foreseeable future.  Guest fees and outing may have to become a larger portion of the revenue of very private clubs.

Which would be fine with me.......

[Adrian_Stiff]

Adrian, this has been discussed ad infinitum on this website.....until tax laws change, the UK and US models regarding guest play will remain completely different animals at private clubs. 

Clint- What are the tax laws that make it difficult? Sorry if this has been discussed before, I must have missed it.

[Adrian_Stiff]

I know everyone has a different idea of what is great, but I agree with the posts that a great club is not always the best course. In the UK we have pubs and the great pubs are the ones with great characters, they draw others in and busy means better, a great pub would not be one where u sat and drank, you may as well be at home. The idea to make a great pub is to provide 'things' which draw people in and those people interact, could this form of principle be used to make a great golf club?

[Mark Chaplin]

Patrick - kind words, I would say I've played some pretty rough rural courses with fantastic golf loving memberships who get their fix with their friends on less than ideal courses. We are "lucky" at Deal to have a very varied membership of good people.

Bill/Kevin - most clubs I know over here limit the same guest to around 6 visits a year.

Adrian - I've been pretty lucky and played some great US courses, many of which I do not know how much they charge for a guest fee. It is pretty easy here to pay your way when a guest fee ranges from under a tenner (2 top 50 clubs I can think of) to around £30. It is harder in the US to say "come and be my guest for a round, by the way it will cost you $80-220 and don't forget the caddie $40-100". Your guest has to be a pretty good friend to pay around $300 including caddie at one top 10 club I visited. Only Wentworth at £90 a guest at weekends comes close in my experience.

As guest play isn't really a direct income generator in the US model the cost does seem high especially as the right to introduce guests is a benefit of club membership.

[Adrian_Stiff]

Patrick - kind words, I would say I've played some pretty rough rural courses with fantastic golf loving memberships who get their fix with their friends on less than ideal courses. We are "lucky" at Deal to have a very varied membership of good people.

Bill/Kevin - most clubs I know over here limit the same guest to around 6 visits a year.

Adrian - I've been pretty lucky and played some great US courses, many of which I do not know how much they charge for a guest fee. It is pretty easy here to pay your way when a guest fee ranges from under a tenner (2 top 50 clubs I can think of) to around £30. It is harder in the US to say "come and be my guest for a round, by the way it will cost you $80-220 and don't forget the caddie $40-100". Your guest has to be a pretty good friend to pay around $300 including caddie at one top 10 club I visited. Only Wentworth at £90 a guest at weekends comes close in my experience.

As guest play isn't really a direct income generator in the US model the cost does seem high especially as the right to introduce guests is a benefit of club membership.

Mark - Yes I can how the low guest fee is in effect a members perk. What I would say is that things in life are better if they are fair and the worlds leaders strive to meet this impossible task, Jeff on an earlier post alluded to a number of his 'hates' (13 of them) and whilst I dont agree with all of them I do agree with some, my point is paying for what you use is better than paying for things you dont use, so if the $600 monthly includes a bit built in order to bring guests cheaper why not drop the monthly burden a bit but take away the perk, the man that does not bring guests is inhibited. Equally, if you want the pool you pay extra, if you want to eat you pay, if you dont want to eat you dont have a forced position.
US golf clubs have been able to dictate because the clubs have been full and it is a case of these are our rules, remit or resign. With a shortage the balance will shift over time that the customer will get the bits that he wants, in a competitive market clubs will have to be less forcefull.
The scenario has shifted in the UK from an all in package at golf clubs too lots of modern clubs offering a cheaper platform of membership for limited use. Fairness is the man that plays twice a week should pay more than one that only gets out once a month, the problem is the higher user goes to clubs that do an all in deal because thats best for him, that club never maximises its revenue and is on a crash course to doomsville. Committees and boards at golf clubs are generally made up from the minority sectors that are the high clubhouse users which I think on GCA we are almost unanimous is the cause of a lot of the financial golf club problems.

[Patrick_Mucci]

Adrian,

The advantage of NO starting times is spontaneity, the ability to go to the course without notice and pick up a game.

With starting times, most foursomes are set in advance, and, starting times aren't reserved for singles.

If your plans change and you decide to play golf in the morning, without starting times you can usually pick up a game.

The lack of structure is a positive at a local club.
At larger facilities, tee times are almost a necessity.

Picture Hunter's Run or Boca West, residential golf communities with about 3,000 golfers.
Tee times have to be set early and randomly.  Everyone can't have the 8:00 am tee time.
Hence, golfers have to make a committment five days in advance.
And, if they wake up on the morning of their tee time, they may not feel like playing, but are more or less obligated to do so.

Having experienced both systems, I prefer NO tee off times by an enormous margin

At a local course, no tee times allows for more intermingled play, whereas tee times seem to encourange clicks or set games.

I'm familiar with a club that had NO tee off times, then switched to tee off times and it changed the culture of the club, for the worse.

It created set games and clicks, whereas with no tee times there was more intermingling of the membership.

In the U.S. clubs with NO tee off times seem to be better "GOLF" clubs

[C. Squier]

Adrian, this has been discussed ad infinitum on this website.....until tax laws change, the UK and US models regarding guest play will remain completely different animals at private clubs. 

Clint- What are the tax laws that make it difficult? Sorry if this has been discussed before, I must have missed it.

US clubs can't be supported in the same way UK clubs are by non-member sponsored guest play.  Most clubs are tax exempt and to keep that status non-member revenue has to be under a certain level.  

Mark - I'll be happy to take your place at any of the US's "top 10" clubs for $300    

The supply/demand curve is a tricky thing.  Fees too high, you feel like you can't bring anyone out.  Too low, and the course is all guest play.  I don't want to be a member at a golf factory that has guest play stacked on the first tee all day long either.  

[Kevin Cahoon]

Adrian, this has been discussed ad infinitum on this website.....until tax laws change, the UK and US models regarding guest play will remain completely different animals at private clubs.  

Clint- What are the tax laws that make it difficult? Sorry if this has been discussed before, I must have missed it.

Adrian,

The basic issue is that many private clubs are not for profit entities for tax purposes. As such, only 15% of a clubs total revenue can come from non member sources.  

[C. Squier]

Adrian,

The advantage of NO starting times is spontaneity, the ability to go to the course without notice and pick up a game.

With starting times, most foursomes are set in advance, and, starting times aren't reserved for singles.

If your plans change and you decide to play golf in the morning, without starting times you can usually pick up a game.

The lack of structure is a positive at a local club.
At larger facilities, tee times are almost a necessity.

Picture Hunter's Run or Boca West, residential golf communities with about 3,000 golfers.
Tee times have to be set early and randomly.  Everyone can't have the 8:00 am tee time.
Hence, golfers have to make a committment five days in advance.
And, if they wake up on the morning of their tee time, they may not feel like playing, but are more or less obligated to do so.

Having experienced both systems, I prefer NO tee off times by an enormous margin

At a local course, no tee times allows for more intermingled play, whereas tee times seem to encourange clicks or set games.

I'm familiar with a club that had NO tee off times, then switched to tee off times and it changed the culture of the club, for the worse.

It created set games and clicks, whereas with no tee times there was more intermingling of the membership.

In the U.S. clubs with NO tee off times seem to be better "GOLF" clubs

Pat, I was typing my response as you posted yours.....what you say is a big deal.  At Olympia during the work on the South Course, we had to go to tee times on the North.  It was managed very well by the golf staff, we had a website we could arrange times on, or we could just call in and book.  For the most part, it worked very well and didn't have any problems.  But you immediately lost the freedom of dropping what you were doing to just head out to the course.  A huge intangible benefit to playing at a club without tee times. 

There was no big celebration when the website was disabled and tee times went away, but regaining autonomy was a good feeling.

[Dan Herrmann]

We have a really cool thing I'll call Tightwad Tuesday.  Guest fees are 50% off every Tuesday.  I don't know how many members we've gotten out of it, but I know it's been successful to increase play on a day where the course otherwise would've been essentially empty.

In the US, at least, private golf clubs need to figure out how to build a good membership when folks are spending so much time at work. 

[Patrick_Mucci]

Adrian,

Many have forgotten that a Judge ruled that UNACCOMAPNIED GUESTS are a form of member/ship, and as such, had to be counted in determining if the club had reached the "non-private" threshold of 400 members, which had onerous consequences, so, it's not just the tax laws, it's the anti discrimination and public use laws that influence the amount of guest play in the U.S.

However, there's another factor that hasn't been discussed.

Some golfers seem to think that they have a right of entitlement to play any course they choose.
Some guests, especially unaccompanied guests, don't take proper care of the golf course, don't follow the club's rules and can be rude and obnoxious.

Why would a membership want to open its doors to golfers who are unaccountable for their behavior ?

Why would members, who pay a pretty penny to play at their club, want others, en masse, to invade their golf course at a deeply discounted rate ?

Many courses were already busy, why would they want to become even more crowded ?

[Carl Rogers]

I have read everything each contributor to this thread has written and make a few observations:

1. I caddied when in junior high school at Wellesley (Massachusetts) Country Club.  Sadly, most of the membership treated me like just a dumb piece of furniture. (Somehow this did not thwart my developing interest in the game.)

2. My family was from Memphis, Tennessee which in its clear racial, cultural and economic divides precluded me from ever getting near any of the better (private) golf courses.  Thus my golf was confined to the typical crowded burned out muni.  I have spent a lot of time in the singles line.

3. Now in the middle age, I could belong to any of the private clubs where I now reside (Tidewater Virginia).  I have chosen not to because (1) old habits are hard to break (2) the bang for buck in 2 daily fee courses (1 being Riverfront) very close to home that offer better golf.

I have discovered 1 item about the game and that is it brings together people that otherwise have nothing in common but the game itself.  It has reinforced the conviction I have that golf represents its own separate world apart.  Any effort of a new club to create litmus tests other than a willingness to play and enjoy the game is not for me.

[Adrian_Stiff]

I suppose No tee times works okay if your not a busy club and yes it does help interaction of members. If you were busy you would be gagging to book a time.
We have tee times and there are players that form groups that just turn up and go out, so we have both those plusses.
I still dont see a minus in being able to book though, if I was taking a guest I would want to agree a time, not let my guest turn up and have to hang around for ages.
There is still no sense to me in not having tee times.

[Dan Herrmann]

Carl,
Your last sentence is right on the money:  "Any effort of a new club to create litmus tests other than a willingness toplay and enjoy the game is not for me".  Well said, sir!

[Patrick_Mucci]

Carl,

When a developer pays a good amount of money for the land on which to build a golf course, hires a quality architect and builds a superior product, and builds a nice clubhouse, should he operate the course as a charity, letting everyone in without any financial consideration, or, is he entitled to attempt to recoup his investment through initiation fees and maintain his facility through annual dues ?

Should Sand Hills, Pacific Dunes, Bandon Dunes, Sebonack and others allow everyone to play for $ 25 and ignore the developers right to recapture the money he spent to create these courses ?

[Adrian_Stiff]

Ok I understand the US tax situ abit now. Do some US golf clubs, ie those with lots of daily green fees pay tax?

In the UK we have a situation although I think it will change soon where some clubs (the not for profit ones) are exempt from charging tax (17.5%) on their subscriptions. It allows an unfair situation with two the different type of clubs trading. I think the goverment will overturn this and return the tax possibly 25 years worth back to the clubs that have paid the tax.

I think at the moment clubs are just Membership exempt athough their are challenges that green fee income should be treated the same way.... If both cases win its gonna cost the goverment £1,000,000,000.

[Adrian_Stiff]

Carl,

When a developer pays a good amount of money for the land on which to build a golf course, hires a quality architect and builds a superior product, and builds a nice clubhouse, should he operate the course as a charity, letting everyone in without any financial consideration, or, is he entitled to attempt to recoup his investment through initiation fees and maintain his facility through annual dues ?

Should Sand Hills, Pacific Dunes, Bandon Dunes, Sebonack and others allow everyone to play for $ 25 and ignore the developers right to recapture the money he spent to create these courses ?

Patrick - Clearly each facility should cost more, if its high quaity its a high price, those are just normal market conditions. I am not totally against snobotoriums it would not be a golf club for me but it suits some.

[C. Squier]

Pat, isn't the 400 member provision only for New York?

[Steve Lang]

   Don't forget that a well placed pool can serve as a firewater reservoir and get a Fire Inspector off your back! 

[Jeff Shelman]

My club has found a way to create a hybrid model between tee times and no tee times.

On weekend mornings, every other tee time is left open for walkups. It encourages members to show up and play with different groups. But it also allows those who want the same group to make a tee time.

Later on weekends and during the week, every third tee time is left open and isn't bookable on our internet tee time system. That means that if you suddenly find yourself free on a Wednesday afternoon, you can go out to the club and know that your wait isn't going to be that long.

I basically only make tee times if I'm bringing out guests.

Also on topic of guest fees. Ours are about $80 to walk and more to ride. However if you play after 3 p.m. on Saturday or Sundays AND you stay to eat in the grill, the fee is only $40 to walk. That is when I bring the vast majority of my guests out.

[Patrick_Mucci]

Pat, isn't the 400 member provision only for New York?

NO, it isn't.

[Patrick_Mucci]

Ok I understand the US tax situ abit now. Do some US golf clubs, ie those with lots of daily green fees pay tax?


NO, they limit revenues from non-member activities below the threshold because the tax isn't limited to green fees, rather, it's applied to all non-member revenue, parties, dinning, etc., etc.

Hence, if 14.99 % of non-member revenue was $ 1,000,000 and a $ 50 green fee pushed them over 15 %, I believe the entire $ 1,000,050 would be subject to the tax, and that's a major hit to the club's budget.

In the UK we have a situation although I think it will change soon where some clubs (the not for profit ones) are exempt from charging tax (17.5%) on their subscriptions. It allows an unfair situation with two the different type of clubs trading. I think the goverment will overturn this and return the tax possibly 25 years worth back to the clubs that have paid the tax.

I think at the moment clubs are just Membership exempt athough their are challenges that green fee income should be treated the same way.... If both cases win its gonna cost the goverment £1,000,000,000.

[Mark Chaplin]

Some golfers seem to think that they have a right of entitlement to play any course they choose.
Some guests, especially unaccompanied guests, don't take proper care of the golf course, don't follow the club's rules and can be rude and obnoxious.

Why would a membership want to open its doors to golfers who are unaccountable for their behavior ?

Why would members, who pay a pretty penny to play at their club, want others, en masse, to invade their golf course at a deeply discounted rate ?

Patrick - You usually make excellent points but the above has me scratching my head, guests are accountable for their behaviour through their host. I would expect any member who makes an unaccompanied introduction knows the guest well and is comfortable with their behaviour and etiquette before making the intro.

Guests do not appear en masse they need a member sponsor, if the member cannot be trusted then are they a suitable person to be a member of the club? 

Adrian - HMG are skint there is more chance of private members clubs paying VAT than £1b being returned to for profit businesses.

[Patrick_Mucci]

Some golfers seem to think that they have a right of entitlement to play any course they choose.
Some guests, especially unaccompanied guests, don't take proper care of the golf course, don't follow the club's rules and can be rude and obnoxious.

Why would a membership want to open its doors to golfers who are unaccountable for their behavior ?

Why would members, who pay a pretty penny to play at their club, want others, en masse, to invade their golf course at a deeply discounted rate ?

Patrick - You usually make excellent points but the above has me scratching my head, guests are accountable for their behaviour through their host. I would expect any member who makes an unaccompanied introduction knows the guest well and is comfortable with their behaviour and etiquette before making the intro.

Mark, thanks, but, it's not unusual for the member to know ONE guest, while the others in the foursome are unknown to him.

In addition, it's not unusual for charities to auction off several foursomes for play at a golf course.  In that case, there's NO accountability.  And, like it or not, many guests don't take care of the golf course.  Is it any different from people who rent a car from Avis or Hertz ?  Do they treat that car like their own ?  Experience in this area is a great teacher.
I had to remind a member, that his guest would have to leave if he continued to drive his cart on newly seeded areas that had restrictive signs posted, along with ground markings.  Both the member and guest were intimately familiar with golf, rules and etiquette, and both were extremely prominent in their respective fields, but the driver was a large customer of the member.  I did the member a favor by being the "bad" guy. 

Guests do not appear en masse they need a member sponsor, if the member cannot be trusted then are they a suitable person to be a member of the club? 


En masse refers to the large number of guests that would descend upon the course if there were no guest restrictions.

Can you imagine the chaos at Winfed Foot, Pine Valley, CPC and others if guest play was unrestricted ?

[Jeff Goldman]

Here are the basic "safe harbor" tax rules (not saying this as a lawyer):

No more than 15% of gross revenue (generally excludes initiation fees) can be from non-member sources.  There are a bunch of IRS rules and regs about what constitutes a non-member source, which is why any member bringing out more than 7 guests at a time (assuming that is allowed) has to fill out forms stating basically that they are his guests and he isn't being reimbursed by any of the guests.

IF you blow by that number, the IRS may consider whether you qualify as a tax exempt social club.  There can be extenuating circumstances.  If you hold a big tournament, such as a US Open, that "occasional" exceeding of the 15% limit would not kill you (might be another story if you host an event yearly that brings in a lot of revenue, because then you really might be financing the tax exempt purpose with non-member income.

If you lose your tax exemption, you have to keep separate accounting for member vs. nonmember revenue and costs, depreciation etc.  The upshot would be that you would be taxable on your income adjusted by the rules.  It may be that all of your initiation fees would be subject to a 35% tax right off the bat (depending upon whether it's equity).  Banquet business might be heavily taxed because it is very profitable, as is guest play.

Patrick, does the 400 member limit relate to whether you are a public accommodation, and so subject to all of those laws?  AS far as I know, it has nothing to do with tax.

ON tee times, we have a big club, with pretty heavy play, and there is always a contingent wanting to go to tee times.  Most of that push is for member play, not guest play.  Our members who bring a lot of guests do NOT want to have to rush to the tee in the middle of lunch if someone is late.  Much easier to just spend a few more minutes on the range or putting.  We also saw a shift last year in the timing of guest play.  In prior years, only 20% of our guest play was on weekends -- if it was equally distributed, you would expect to see 32 percent on weekends.  Last year, weekend guest play went to 30%, a huge increase, which led to some significant crowding at times that used to be empty. Interesting.