Should the private golf club business model be discussed openly on GCA.com?

[Mike Sweeney]

Google knows much about us, yet they keep their own algorithm secret.

Facebook knows much about us, yet they keep their own algorithm secret.

Hundreds of millions of dollars are spent, massive amounts of discussion surrounds trying to figure out how those models work to "get to the top of Google search" and "maximize ROI on Facebook".

It is a game that millions of people like to play.

The private golf club market in the USA has a history of secrecy around it. My impression is the next generation does not want to play that game and the private club market is suffering.

Over on the Dismal River thread, some of the "old guard" are keeping their private club secrets from being revealed online. Typically, one dinner, one beer, and maybe one email and they sing the truths of the private club finances in private conversations.

For the benefit of the private club market, is it time to discuss how private clubs work online?

[Tim_Weiman]

Mike,

No. At least not at Golf Club Atlas. We are here to discuss golf architecture. Getting into financial matters will only discourage people involved with  projects from participating here and that would be a step backwards.

Financial matters should remain private.

[archie_struthers]

 


I think private club strategies to grow memberships are certainly open for,discussion here. As to individual clubs balance sheets that is more of a sticky wicket.  Certainly if you are thinking of joining a club you would want to know if assessments are a matter of course and the financial,health of the club is an important consideration .

It is an important conversation for golf, if slightly OT for GCA?

[Sean_A]

What goes on at club X is of passing interest and not something I would raise as a topic of discussion.  I don't have anything against discussing private club business here, but I wonder why its so fascinating for some.  On the other hand, it could be the case that serious negative discussion when a club is in a financial bind could be very harmful.  I think its silly that this can be the case, but perceptions can damage reality. 

Ciao

[Jeff_Brauer]

A few years back, someone posted the overall plan of a NC club here.  Very informative, and discussable from the standpoint of the type of members they were going for affected the style of golf course design.

From memory, they realized they were a transition club, one step above an entry club, but not the final destination for serious golfers.  Interesting to see that the private club market is really several markets.

That said, I don't know who posted it, whether they had permission, etc. and I suspect most clubs, while they would work together for the greater good of the industry, would want to see their financials posted here, or anywhere.  They have the club manager meetings for that type of information sharing.

You guys already think you are really helping the gca's of the world....and now you want to "expand the brand" and tell club managers how to run their businesses?  I doubt it would be as well received as in the design industry, and as you all know, gca.com isn't exactly well loved in the golf design industry, either!

[David_Elvins]

.

[Mike Sweeney]

Mike,

No. At least not at Golf Club Atlas. We are here to discuss golf architecture. Getting into financial matters will only discourage people involved with  projects from participating here and that would be a step backwards.

Financial matters should remain private.

Tim,

1. It is really nice to see you posting again.

2. Here is why you are completely wrong

It was 10+ years ago that I played golf at Yale with Tommy, Dr Childs and a friend of theirs who was a very thoughtful guy and obviously he really loved golf course architecture. He was a GCA.com guy before there was GCA.com and this kooky website brought us together. Now I was just starting to drink the juice so I just listened to these three guys rip into and have absolute passion for Yale Golf Course (today it is "The Course at Yale" - yikes).

I was somewhat surprised when this thoughtful guy posted a thread at GCA.com titled "Is Yale The Greatest Tragedy in Golf?".  

Now at the time I was just starting to understand my appreciation for golf courses, I was a new "Ivy League Member" at Yale, aka second tier non-Yalie, so I did not know what to think or how to respond. I tiptoed my way around that thread (my first, not logged in response, was on page 3) http://www.golfclubatlas.com/forum/index.php/topic,5219.0.html Yes, Yale is a private golf club in the European tradition, but this was a controversial topic back then.

That thread by a thoughtful and well meaning guy, imo, was a catalyst of many many things at Yale Golf Course. I won't go into all the drama but fast forward to today and Yale:

• sits pretty solidly on most of the rankings list except for Golf Digest, which can be argued is a good thing
• has hosted the NCAA regionals and they are coming back in a few years
• is beloved on gca.com and has hosted many outings and trips via many gca.com members
• has the perfect Super in Scott Ramsey, he is trusted and tireless in his passion
• hopefully is profitable on the Yale P&L, but certainly is at least a great alumni contributor catalyst
• had a now also famous thread by Tom Doak about Yale's boldness/craziness just last summer after a recent re-look/visit

I really don't think it is too much of a stretch to say that thread by Tim Weiman contributed to the updating of Yale Golf Course. Let's not kid ourselves however, great architecture does cost money.

Fast forward to last summer and three of us (Mark, Jon, Mike) hosted an outing for GCA.com on a Sunday at Yale and Scott Ramsey came out on a Sunday to speak with the group at lunch before the round. Now since I "know everything about Yale" I stayed at the range to hit balls with my son and to make sure newbies knew the logistics as the range is a long walk from the clubhouse. I walked in at the end of the talk grabbed a burger and traded some cheap shots with Pat Mucci.

Now I married a Connecticut girl and I have been playing Yale, been a member, love the place for over 20 years (yikes #2). It was not until Pat Mucci (see the ultimate in private club old guard) published highlights of Scott Ramsey's talk on GCA.com that I ever knew the yearly greens budget of Yale.

My reaction: How can I continue to support Yale to meet its annual nut? I did recruit a new member this year so I have that going for me.

My wife always says about her business, "Information is the cure.". Kids today get their information from the internet, not PDF files, and certainly not phone calls. Architecture cost money, so my thought is let's talk about how much it cost and why private golf is so expensive. I always think to John Kavanaugh's position that he pays to "not have people on his golf course".

Maybe Tom Doak will step in and post his P&L in Google Docs for us to review Just kidding Tom....

PS. Just saw Archie's thread on Atlantic City CC. Maybe the perfect case study as it has bounced around a variety of models over the last 20 years. I also love that place.

[Mark Bourgeois]

You know, Mackenzie wrote that great architecture should cost less, or at least great advice should (ie professional advice), and so the question being raised on the Dismal thread are I think appropriate and relevant. David is trying to understand what that project offers in lessons of economic sustainability of architecture. Some interesting stuff has come out, like routing choices.

In an economic sense we tend to focus on people like Doak because of his revenue impact. We don't test Mackenzie's words often or deeply enough. Asking about the cost efficiency of the work by people like Doak and Mahaffey (and Nuzzo) seems like a great way to do that.

(And, no, just because the questions are raised doesn't mean a person in the know has to answer them. And, no, I'm not talking about professional fees as a source of cost savings. I'm talking about how Party A can build something better and cheaper than Party B.)

[Mike_Young]

You know, Mackenzie wrote that great architecture should cost less, or at least great advice should (ie professional advice), and so the question being raised on the Dismal thread are I think appropriate and relevant. David is trying to understand what that project offers in lessons of economic sustainability of architecture. Some interesting stuff has come out, like routing choices.

In an economic sense we tend to focus on people like Doak because of his revenue impact. We don't test Mackenzie's words often or deeply enough. Asking about the cost efficiency of the work by people like Doak and Mahaffey (and Nuzzo) seems like a great way to do that.

(And, no, just because the questions are raised doesn't mean a person in the know has to answer them. And, no, I'm not talking about professional fees as a source of cost savings. I'm talking about how Party A can build something better and cheaper than Party B.)

The biggest cost efficiency in architecture is a sandy site...nothing else comes close...given that water is available at a reasonable cost.

[Tim Martin]

You know, Mackenzie wrote that great architecture should cost less, or at least great advice should (ie professional advice), and so the question being raised on the Dismal thread are I think appropriate and relevant. David is trying to understand what that project offers in lessons of economic sustainability of architecture. Some interesting stuff has come out, like routing choices.

In an economic sense we tend to focus on people like Doak because of his revenue impact. We don't test Mackenzie's words often or deeply enough. Asking about the cost efficiency of the work by people like Doak and Mahaffey (and Nuzzo) seems like a great way to do that.

(And, no, just because the questions are raised doesn't mean a person in the know has to answer them. And, no, I'm not talking about professional fees as a source of cost savings. I'm talking about how Party A can build something better and cheaper than Party B.)

The biggest cost efficiency in architecture is a sandy site...nothing else comes close...given that water is available at a reasonable cost.

Mike-I think you are 100% correct so doesn't this become an apples to oranges exercise when trying to compare building on sand versus anything else and especially a clay based site? Additionally with sand there is a high expectation that the flora or lack thereof is also completely different? Seems that there is some hope of applying specific principles across the board when many are most certainly site specific.

[Chris Johnston]

All,

I agree that there is a ton of information that could be shared in the name of sustainability and/or good practice, yet few share it.  That is the reason I love the site and contribute, including a new course from beginning to completion.

Disacussion of a given model may be worthy, as long as it doesn't destroy what the club is in the process.

Mike, it isn't "old guard" to keep member information private.  Some members are open and I am encouraged with that.  Other members aren't, and that simply must be honored as well.  Pretty simple, really.

I think we have shared as much, if not more, about the goings on at Dismal River than most anyone.  What I am unwiiling to share, for very good reason, is something that involves another, for example, a member who simply might object to it being shared.  That would be both poor form and not very good business.  Pretty common stuff.  

That said, I'm more than happy to share various aggregate costs, and have, on the new course.  For similar reasons to the above, things like design, consulting, and irrigation fees are not my place to share, and are at times bound by confidentiality.  Those are the private affairs of another, and could impact their own proprietary information.  That's why the numbers, in aggregate, work best.  It may be different in 30 or 50 years.

There is also no one standard for cost, for the process is "alive".  For example, there is cost to build, and there is cost to build and grow in.  There is cost for drainage.  We have completed one and, understandably, are still very underway in the others.  Last is cost to maintain, and we can't provide information for we simply aren't fully past the grow in stage.

The new course at Dismal is on sand, and water is in abundance today.  That certainly helped costwise, and will also be a benefit going forward.

CJ

[BHoover]

Could we discuss the business model at ANGC?

[Mark Bourgeois]

Brian, around its founding and construction? Sure, there is a pretty decent amount of information in the public domain.
Mike, thanks for that. Given a locale, eg sand-based, will costs vary much depending on the design and the team chosen?

[Jason Topp]

I do not see how you can separate the issue of architecture from the business model for the course. Mackenzie and Tillinghast sold their services as resulting in efficiencies for their clients. The financials determine whether couses get built, their location, how they are maintained and whether or not they survive.  

Maintenence practices and budgets are critical factors in determining whether or not courses survive. I just played La Quinta Mountain and the shop apologized for the condition of the course because the were unable to overseed this year due to summer flooding. The course is in perfect condition and looks great to me.

Often those budgets are facing pressure due to the decision of club boards to build a huge clubhouse. If one does not understand those financial pressures, one cannot advocate in his own club to avoid such fate.

One conclusion I have reached over time isthat courses tend to get built on the cheapest land and that has been true since Links courses were built. It is an interesting concept that helps one to understand where courses were built in the past and where they are likely to be built in the future.

I agree with Chris that you should be respectful of those in the trenches but great architecture only happens if the financial model is effective. We need to talk about such issues.

[BHoover]

Brian, around its founding and construction? Sure, there is a pretty decent amount of information in the public domain.
Mike, thanks for that. Given a locale, eg sand-based, will costs vary much depending on the design and the team chosen?

I would be curious to know what type of money the club generates from The Masters on an annual basis.  My motivation is purely based on curiosity.

[JMEvensky]

Brian, around its founding and construction? Sure, there is a pretty decent amount of information in the public domain.
Mike, thanks for that. Given a locale, eg sand-based, will costs vary much depending on the design and the team chosen?

I would be curious to know what type of money the club generates from The Masters on an annual basis.  My motivation is purely based on curiosity.

Would you really believe anything you read here? I doubt if the members know.

[Tim_Weiman]

Mike,

Thanks for your response to my post and for that quite interesting blast from the past.

I have been privileged to enjoy many memorable experiences visiting famous golf courses, but that day at Yale was certainly a classic. It is flattering that you give me so much credit for how things progressed at Yale, but my memory certainly credits others.

Tommy Naccarato's tough love speech to the Yale brass was priceless and probably served as the inspiration for the Yale tragedy thread. Geoff Childs put a great effort into encouraging Yale to understand what they had. Ditto for George Bahto who had a great appreciation for the place from his research on CBM and Raynor. Finally, I believe Brad Klein wrote his own tough love editorial in Golfweek soon thereafter.

[John Kirk]

I vote no, and am in full agreement with John Kavanaugh and Chris Johnston.  Literally none of your business, and not for the public record.

[BHoover]

Although I'm naturally curious, it's none of my business how a particular club manages its finances or runs its business, especially clubs of which I am not a member.

[Carl Nichols]

Surely there can't be a problem discussing the business models of the private golf clubs owned by public companies like Toll Brothers? 

[Mark Pearce]

I vote no, and am in full agreement with John Kavanaugh and Chris Johnston.  Literally none of your business, and not for the public record.

I think you are attributing a meaning to Chris's post which simply isn't there.  In fact it seems to me as if he's saying yes, so long as you don't reveal member information.  Why a general discussion about a particular business model should be a problem is entirely beyond me.  You'd discuss the business model of a company, wouldn't you?

[John Kirk]

Hi Mark,

I guess my reluctance to talk about club finances comes from personal experience.  I joined two clubs in the past decade which had financial problems and reorganized.  In general, talking about what happened and how the clubs are financed seems private to me.

I agree that general discussions about financing clubs is reasonable.  However, David Elvins was asking John Kavanaugh some personal questions, which involved further discussion about his role in Dismal River finances.  John didn't want to talk about it further.  Chris followed up with some general comments.  It's only fair game if the principals want to discuss it.

I have to go.  I'm going to Disneyland.   It's right across the street.

[Tom_Doak]

My wife always says about her business, "Information is the cure.". Kids today get their information from the internet, not PDF files, and certainly not phone calls. Architecture cost money, so my thought is let's talk about how much it cost and why private golf is so expensive. I always think to John Kavanaugh's position that he pays to "not have people on his golf course".

Maybe Tom Doak will step in and post his P&L in Google Docs for us to review Just kidding Tom...

Mike:

I stopped looking at the Dismal River thread right after a couple of friends quit the web site over it.  I didn't realize it had rolled around to the economics of the operation.

I agree with your wife.  I wish I could talk about the economics of golf course architecture and development, in much greater depth than I have done.  I try to teach a bit about it to my interns and associates -- but they'd better not post here the P&L statements for my company that I have shared.

By the same token, many/most of my clients feel that information on design fees and cost of construction is proprietary, so I'm obliged not to talk out of school about it.  It's too bad, because really talking about it would blow some people's minds; but I can only do so in  private, with potential clients.

With respect to Mark Pearce's question, talking about the business models of various companies without discussing the specifics of how they are working, is pretty pointless.  And as John Kirk says, discussing the finances of particular clubs is unfair unless you are going to do it across the board.  They're like banks ... loose talk can lead to a loss of confidence and cause a run on one ... even though many of their competitors are really in the same or worse position, and just better able to avoid talking about it.

[Chris Johnston]

Agree with Tom here.  While it might be an interesting topic, if you don't talk about them all, there really is no point to the exercise.  And I say that hearing there really are so many positive things happening at a host of clubs.

Further, the exercise is futile given the way some here choose to treat those that attempt to share much anything at all...it certainly doesn't motivate conversation, and only serves to harm.  It's a shame, really.

[Carl Johnson]

A few years back, someone posted the overall plan of a NC club here.  Very informative, and discussable from the standpoint of the type of members they were going for affected the style of golf course design.

From memory, they realized they were a transition club, one step above an entry club, but not the final destination for serious golfers.  Interesting to see that the private club market is really several markets.

That said, I don't know who posted it, whether they had permission, etc. and I suspect most clubs, while they would work together for the greater good of the industry, would want to see their financials posted here, or anywhere.  They have the club manager meetings for that type of information sharing.

You guys already think you are really helping the gca's of the world....and now you want to "expand the brand" and tell club managers how to run their businesses?  I doubt it would be as well received as in the design industry, and as you all know, gca.com isn't exactly well loved in the golf design industry, either!

Jeff, could have been the club I belong to (Carolina GC in Charlotte), since our GM has put a lot on GCA about our model.  However, the description "they realized they were a transition club, one step above an entry club, but not the final destination for serious golfers" would not be very accurate for our club, which targets golfers who are not interested in the entire, traditional American country club model.  Since we don't offer the full package (but do have a swimming pool) and are less expensive than the full-scale model, some join for cost reasons and may later go to a full-scale club if that's what they really want when they can afford it.  However, the serious golfers, if that's all they are interested in - golf - stick around.  I think that sort of information is worth it on this site - it does relate to the course, in that we really focus all of our efforts on the course, both from a design and maintenance standpoint, and can afford to do so because we are spending little money on other things.  I our area Carolina GC's approach is pretty well known.