Paradigm shift needed for clubs

[Geoffrey_Walsh]

Golf clubs need to migrate towards an all inclusive upfront annual fee, rather than assessing costs piecemeal throughout the year.  For the individual this shifts the focus from minimizing costs, to maximizing play to get the most value for the dollars spent.  Discuss.

[Jon Wiggett]

Geoffrey,

this is the model already used by almost all clubs here in GB&I as well as most of the rest of Europe. I suspect the monthly payment model that seem to be more the norm in the USA is what has lead to golf in the USA being so expensive and many clubs concentrating on other things a head of the golf itself. Of course I could be wrong with my last assumption.

Jon

[Jason Topp]

We have that structure at my club.  I don't know if it makes economic sense or not but I can tell you it is nice to have one day of pain followed by a season of pleasure. It is also nice to avoid all of those individual charges one incurs along the way.

[Brent Hutto]

I'm not sure what all you are proposing to bundle into an annual charge. Our club has recently streamlined its billing somewhat with a couple of nickel and dime fees now part of the monthly dues. But there's still a food minimum beyond the dues and if one wishes to acquire a clubhouse locker or have ones clubs and/or pull cart stored at the club, those are separate (yearly) charges.

Are you just talking about billing 12 months of dues in advance on January 1? I for one would find it inconvenient to have to pay up front something over $4,000 rather than sending in a check for 1/12 that amount on the first of each month. Not sure what exactly that would accomplish at our club other than further depleting our already below-target membership numbers.

And even then wouldn't you still need to post-bill periodically for whatever food and beverages, not to mention pro shop mechandise charges, were incurred?

[Paul Gray]

Brent,

I'll try to give a little insight into some general practices over here, just to give a little feel for what Jon W was referring to:

1) Annual subs are due in either January or April. Most clubs will allow you to set up a monthly direct debit to spread the cost over twelve months.

2) Minimum food expenditure sounds alien to me and I'm not quite sure what this is about. You pay for what you eat as and when you eat it. Some clubs will run a tab system but most people will just pay for food and drink up front. Receiving a monthly bill from the golf club would be regarded by us Brits as a bureaucratic nuisance, not to mention rather poor form! If anyone does have a tab and it builds up a bit they will be gently reminded of the situation. Only after a prolonged period would a letter be sent out.

3) Most club comps, aside from winning a trophy, involve winning pro shop credit. Spending that credit on a little treat always feels like a rewarding and pain free way for members to shop. Typically you'll pay about £3 to enter a weekly competition and all the proceeds are then converted into prize funds. £300 or so spread out amongst the top five finishers means modest but acceptable winnings.

3) Your average club doesn't necessarily have lockers but those that do will have varying policies. Certainly nothing is obligatory.

Perhaps one of the key points to realise here is that traditional clubs are more like cooperatives than businesses. The only shareholders in many cases will be the members themselves and any profit will be pumped back into the club.

[BHoover]

I know there are plenty of former threads that my comment could go under, but the title seemed appropriate.

I recently received an email from my former club (for whatever reason, I haven't been removed from the email list), and I noticed an interesting and disturbing item.  Specifically, the board provided yearly financials that show the YTD expenses for food and beverage exceed the expenses for BOTH golf course operations and golf course maintenance (by a not insignificant amount).  Maybe this is not unique compared to other clubs, but HOW is that type of situation sustainable?

My guess is that, unfortunately, it is not sustainable.  Clearly, a paradigm shift is needed.

[Brad Klein]

Paul Gray,

Regarding minimum food expenditures. This is a function of several converging developments in U.S. golf:

-over-built clubhouses
-lousy food service at high cost per meal (each dinner served loses $)
-too much outside competition from decent restaurants
-declining consumption of high profit-margin liquor and the need to generate replacement revenue streams
-exploiting a captive market of post-golf guys and their abandoned families
-the pretense of being a full-service country club in an era of multiple other social options that are more compelling
-the desire by F&B managers to have a massive kitchen/staff on hand for lucrative social functions, banquets, weddings, corporate events 30-X a year, which means that you have a big underused kitchen with too much staff the other 200-days a year and you have to create work for them
-the need to be able to draw a renowned big-name executive chef who then has to have something to justify his 6-figure salary, so he now gets to provide dinner for reluctant members who only jam up the dinning room at the end of each billing cycle.

In other words, you're forcing people to spend money to keep the club from going under.

[Mike_Young]

The clubhouses have hurt the US Country Club model much more than the golf.  GM's have often convinced boards that F&B is a much bigger money maker than golf and will often allocate the majority of the dues to F&B and clubhouse overhead.  It will change.  I think one thing we will see is more lodging incorporated into once banquet rooms and other "leaking" areas of the "upstairs".  The model is broken and our kids don't want it.  It will change.

[Andrew Buck]

The clubhouses have hurt the US Country Club model much more than the golf.  GM's have often convinced boards that F&B is a much bigger money maker than golf and will often allocate the majority of the dues to F&B and clubhouse overhead.  It will change.  I think one thing we will see is more lodging incorporated into once banquet rooms and other "leaking" areas of the "upstairs".  The model is broken and our kids don't want it.  It will change.

Agreed.  Even if enough members do want one or two dining evenings, at some point it makes more sense to cater and do bar than have full staff.  

I enjoy that we can bring our kids to the club on Friday nights and know other members will do the same.  That said, if going out, generally there are better options, and if dues would go down a lot without F&B, we can find other places to socialize with our friends and kids.  Now take away the swimming pool, and I'll have trouble convincing my wife it's more valuable than the public course options.  

[BHoover]

I enjoy that we can bring our kids to the club on Friday nights and know other members will do the same.  That said, if going out, generally there are better options, and if dues would go down a lot without F&B, we can find other places to socialize with our friends and kids.  Now take away the swimming pool, and I'll have trouble convincing my wife it's more valuable than the public course options.  

My wife and I enjoy the occasional meal at our current club.  But we enjoy it because the atmosphere is casual and the club has a nice patio with outdoor seating.  We go maybe twice each month.  She also uses the pool and plays tennis.  When we have kids, I hope they will want to use the club (although the thought of a large monthly bill scares me).

I have no doubt that there are clubs where F&B is not a money loser.  If the members are willing to support it, then that's great.  But what's not sustainable are situations where F&B consistently loses money and yet the board does nothing to change.  I can't see the members at most clubs willing to put up with year-end dues true-ups to cover the bloated costs of F&B and other fluff.  Speaking for myself, I won't do it.  That's one reason I'm no longer a member at my former club.

[Tony_Muldoon]

Paul Gray,

Regarding minimum food expenditures. This is a function of several converging developments in U.S. golf:

-over-built clubhouses
-lousy food service at high cost per meal (each dinner served loses $)
-too much outside competition from decent restaurants
-declining consumption of high profit-margin liquor and the need to generate replacement revenue streams
-exploiting a captive market of post-golf guys and their abandoned families
-the pretense of being a full-service country club in an era of multiple other social options that are more compelling
-the desire by F&B managers to have a massive kitchen/staff on hand for lucrative social functions, banquets, weddings, corporate events 30-X a year, which means that you have a big underused kitchen with too much staff the other 200-days a year and you have to create work for them
-the need to be able to draw a renowned big-name executive chef who then has to have something to justify his 6-figure salary, so he now gets to provide dinner for reluctant members who only jam up the dinning room at the end of each billing cycle.

In other words, you're forcing people to spend money to keep the club from going under.

Unbelievable.

Next time some wag quotes me "Cocaine is God's way of saying you earn too much", I'm going to reply that's nothing, there are places in this world where folks cue up to join a golf club where the Chef earns six figures.


Paul there are a no of UK clubs where members have to pay an annual minimum ammount into this fund.  Normally it goes on a a card, earns you 10% discount on quoted prices and any credit balance can be carried over from one year to the next. Normally its no more than £50 to £100 per annum.
I know a guy who was a member at a fairly toney club on the eastern seaboard and he had trouble spending his minimum unless he took the family for two meals each month as there was no monthly carry over. It wasn't a problem as he lived nearby. He learned to time his second visit for the end of each month, whereupon another member who was about to see a large part of his monthly sum wasted, would send him over an expensive bottle of complimentary wine!

I have played but one game at an upmarket US Club. Don't get me wrong it was a great and memorable day. But would I have enjoyed it any less if the members hadn't paid for a man to spend his Saturday’s handing out wet Golf Towels for the bag?  It was so alien to me I forgot it was there when I threw the clubs in the trunk afterwards.

Two great Golfing Nations separated by strange customs.

[Bill_McBride]

I enjoy that we can bring our kids to the club on Friday nights and know other members will do the same.  That said, if going out, generally there are better options, and if dues would go down a lot without F&B, we can find other places to socialize with our friends and kids.  Now take away the swimming pool, and I'll have trouble convincing my wife it's more valuable than the public course options.  

My wife and I enjoy the occasional meal at our current club.  But we enjoy it because the atmosphere is casual and the club has a nice patio with outdoor seating.  We go maybe twice each month.  She also uses the pool and plays tennis.  When we have kids, I hope they will want to use the club (although the thought of a large monthly bill scares me).

Brian, it's very important that your kids NOT know the family club account number!

[BHoover]

I enjoy that we can bring our kids to the club on Friday nights and know other members will do the same.  That said, if going out, generally there are better options, and if dues would go down a lot without F&B, we can find other places to socialize with our friends and kids.  Now take away the swimming pool, and I'll have trouble convincing my wife it's more valuable than the public course options.  

My wife and I enjoy the occasional meal at our current club.  But we enjoy it because the atmosphere is casual and the club has a nice patio with outdoor seating.  We go maybe twice each month.  She also uses the pool and plays tennis.  When we have kids, I hope they will want to use the club (although the thought of a large monthly bill scares me).

Brian, it's very important that your kids NOT know the family club account number!

Great point!  I'm also going to make sure that if we have any daughters, they won't take up riding horses.  Talk about expensive!

[David_Tepper]

"Two great Golfing Nations separated by strange customs."

Tony M. -

Yes, you are correct. Attempting to compare the cost structure, expenses, dues, fees, budgeting, etc. of golf clubs in GB&I with the golf clubs and country clubs in the U.S. is a pointless exercise. They are two very different animals. Since I belong to a club on both sides of the Atlantic, I am well aware of this.

Each model has been, and likely will continue to be, successful in their own way.

DT    

[Bob_Huntley]

Paul Gray,

Regarding minimum food expenditures. This is a function of several converging developments in U.S. golf:

-over-built clubhouses
-lousy food service at high cost per meal (each dinner served loses $)
-too much outside competition from decent restaurants
-declining consumption of high profit-margin liquor and the need to generate replacement revenue streams
-exploiting a captive market of post-golf guys and their abandoned families
-the pretense of being a full-service country club in an era of multiple other social options that are more compelling
-the desire by F&B managers to have a massive kitchen/staff on hand for lucrative social functions, banquets, weddings, corporate events 30-X a year, which means that you have a big underused kitchen with too much staff the other 200-days a year and you have to create work for them
-the need to be able to draw a renowned big-name executive chef who then has to have something to justify his 6-figure salary, so he now gets to provide dinner for reluctant members who only jam up the dinning room at the end of each billing cycle.

In other words, you're forcing people to spend money to keep the club from going under.

Brad,

I think that just about sums up the problems with many clubs.  I know of one club where there seven places to eat. The yearly dining tab is about $1800.00 a year and is split into two semi-annual payments. The out of town members get hosed when they are here for a retreat from excessive heat or cold for a couple of months.

Bob

[Brent Hutto]

At our not particularly upmarket club, the dining service is mostly there as an amenity for the roughly 50% of the members who live either adjacent to the club or in subdivisions within a mile or two. They love doing the Friday night dinner thing and they see all the usual suspects there each week. Problem is, those "usual suspects" are at most a dozen couples and fewer than a handful of families. Most Fridays there are single-digit numbers of occasional diners. So you've got this enormous kitchen and dining room with a moderately elaborate menu being put into service for about 30-odd people. And that leaves off the occasional Friday where for various random reasons nobody at all shows up or there are only a single-digit number of dinners served, total.

The monthly food minimum (note that I did not say F&B, just food counts) is 50 bucks which is just about exactly what I manage to eat there in lunches after golf at the weekends. So I don't complain. But the whole deal even with every member "spending" at least that 50 bucks has still been a money loser for longer than I've been a member. It's nice for those 30 regulars to have a decent neighborhood place to eat, I guess.

P.S. And don't get me started on the underpriced, overserved "money making" wedding banquets we host 25 or so times a year. By the time all the staff make their overtime we either lose a few dollars or maybe occasionally come out a hundred bucks to the good. But the staff love their twice a month extra hundred bucks and I suppose I should not begrudge them that.

[Wayne_Kozun]

I recently received an email from my former club (for whatever reason, I haven't been removed from the email list), and I noticed an interesting and disturbing item.  Specifically, the board provided yearly financials that show the YTD expenses for food and beverage exceed the expenses for BOTH golf course operations and golf course maintenance (by a not insignificant amount).  Maybe this is not unique compared to other clubs, but HOW is that type of situation sustainable?

My guess is that, unfortunately, it is not sustainable.  Clearly, a paradigm shift is needed.

Is that expenses for overhead or is that F&B cost of goods sold?  If it's COGS then don't forget that this is totally dependent on the amount of food sold at the club, therefore it is not at all surprising.  The more food you sell the higher your expenses. If it is overhead like wages for cooks, waitresses, etc then that's excessive.

[John McCarthy]

Foodies of GCA:  

Have any of you ever had a great meal at a country club?  

I have not.  There were plenty of OK stuff, like a good filet, and some OK fried chicken.  But in a city filled with great food there is no way I'd like to dine on overpriced rubber chicken at the country club.  

Exception:  I love club sandwiches and most clubs make a good one.  But that is lunch...

[BHoover]

Foodies of GCA:  

Have any of you ever had a great meal at a country club?  

I have not.  There were plenty of OK stuff, like a good filet, and some OK fried chicken.  But in a city filled with great food there is no way I'd like to dine on overpriced rubber chicken at the country club.  

Exception:  I love club sandwiches and most clubs make a good one.  But that is lunch...

I have some damn good burgers and soups at a few clubs. But generally I agree. If I want great food, I'll go to a restaurant.

[Tommy Williamsen]

Foodies of GCA:  

Have any of you ever had a great meal at a country club?  

I have not.  There were plenty of OK stuff, like a good filet, and some OK fried chicken.  But in a city filled with great food there is no way I'd like to dine on overpriced rubber chicken at the country club.  

Exception:  I love club sandwiches and most clubs make a good one.  But that is lunch...

John, I have to say that the food at my clubs rivals the food at some of our best restaurants in Annapolis. In the las t twenty years food at many clubs has become an important part of the culture.  People at Four Streams have been heard to say that the only thing better than the golf is the food.  The chef has been there since the club began.  If I know I am gong to be at the course I sometimes call ahead and ask her to make one of my favorite dishes.  So yes, some clubs have exceptional food. 

[Lou_Duran]

Brian, it's very important that your kids NOT know the family club account number!

Impossible.  For domestic tranquility, the club bill should be sent to the office and paid from a separate account

To the guy who has never had a good meal at a club, I have had many.  Sadly, very few at my former club of over 20 years.

Without monthly billing, membership rolls would decline, probably steeply.  Not a small number of members struggle enough to pay the monthly bill, even with their names and amounts owed posted on the bulletin board.

[Dan Herrmann]

John McCarthy - the best steak I've ever had by a wide margin was at Sand Hills.  My wife and I were the only customers for dinner the day we were there, and we were treated like we were family.

On the other hand, I'm not rich, and I wouldn't be able to afford my golf club if I had a minimum for food.  As a charter member, I'm exempt.

[Daryl David]

The food at my club in the desert is as good as any of the upscale establishments in the Coachella Valley. Our executive chef was recruited from Herb Kohler's American Club so we are in good hands. Food and wine is a huge part of the club culture and there are many members that feel as passionate about it as they do golf.

[BHoover]

I'm sure there are clubs where food is a key part of the culture of the club. In those cases, where the F&B supports itself and the members are willing to foot the bill, then there's no need to change. But where that is not the case, and particularly where the F&B costs exceed ALL golf related costs, how is that sustainable?

[Wayne Wiggins, Jr.]

once again, i'm staring at the end of the quarter, and a pretty significant bit of my minimum goes unused.  of course, i always remember at the very last minute... talk about throwing away money.  I might be better off with that cocaine habit Tony M. mentioned.