[Lou_Duran]

An operator of a municipal golf course asked me recently what is normally considered "affordable" for a round of golf at a public facility.  This particular course is well above average in terms of architecture, scenery, and even conditioning, but because of its ties to the community and its location, it has a hard time generating enough revenues to support the type of maintenance meld that it so deserves.  The course gets a lot of local play, but most of its patrons do not really understand what they have.  The market is very price sensitive, though the fees have remained low while area inflation has been quite high.  I am not at liberty to identify the name or location of the course.  However, I can say that it is not on either coast, and that the cost of living in the area is below the national average (land is cheap, access to water is not a problem).  The operator wants to better educate the community on this wonderful asset, and possibly consider doing some pricing to generate the additional needed revenues for this self-sustaining facility.

Question:

What is considered "affordable" given the facts above?

I am particularly interested in feedback from Golf Digest, Golf, or Golfweek panelists whose publications many have set criteria in their evaluation of courses based on pricing.

Any and all help is appreciated.

[Scott_Burroughs]

Lou,

While GD sets the affordable bar at $50 (max fee in season), I have a question about this statement:

"it has a hard time generating enough revenues to support the type of maintenance meld that it so deserves"

Doesn't 'proper' maintenance meld actually cost far less money than 'typical', lush-first maintenance?  

[A_Clay_Man]

Lou- I may be a bit 'out of touch' but when I was working and/or cash flow was not really an issue, I always felt that 18 holes at a dollar a hole was acceptable. If there was special attention by management, maybe 2 dollars a hole or $36. Springing occasionally for the $75+ always seemed worth it, but again it was a direct function of cash flow. I think the fifty dollar number is off the charts unless demand warrants it.

[Lou_Duran]

Scott:

The cost of water is not a major issue here.  The soil quality unfortunately is.  In many areas of the course there are only 8" of soil before reaching bedrock.  The water pretty much runs off, and the turf has relatively shallow roots (4 - 5").  As important, the course was built on a shoe-string budget, apparently using the low-cost bidder.  After a number of years in operation, the shortcuts that were taken are coming back to hurt them.  The irrigation system in particular is a costly problem, and there are a number of drainage issues.

BTW, the ideal maitenance meld is not necessarily firm and fast nor the least expensive.  Due to the steep grade in some areas and the presence of bedrock so close to the surface, the low spots will always tend to be moist.   If considerable manual labor and sizable capital improvements for irrigation and drainage are involved, the costs could actually be much more.

BTW2, the gf on this course is under $30, walking.

[George Pazin]

In my area (western PA), I'd say less than $15 is cheap, $15-22 is decent, $22-30 is affordable, $30-50 is an occasional splurge & over $50 is a once every couple years kind of proposition. Golfers in this demographic are willing to splurge on vacation, special trips, special course, etc., but I don't think your average public golfer is looking to spend more than $30 on any kind of recurring basis.

Note: these numbers presume walking. Add maybe another $15 if you're a cart golfer (which I don't think most regular budget golfers are in my area).

[A.G._Crockett]

Lou,
How does this greens fee (under $30 walking) stack up with comparable courses in the area?

[John Foley]

Lou,

When we talk affordable location & market is so intertwined. What is affordable in Dallas is outrageous in Rochester. New upscale course opened hear last year, Ravenwood. Great course, Conditioning & architectural (Robin Nelson) features are top notch. Walking $42 weekday, $54 weekend + $16 for cart. At those prices that is the top end in the area. You can't spend more. Even at those prices for what you get, tee times we're always available. Many times I'd drive by and be amazed by the little play. Thank god for outtings!

Two other area courses Victor Hills (36 moving to 54 holefacility abpout 2 miles away) where the green fee's are roughly half that has 2.5X the number of rounds. Very loyal customer base BTW. Bristol Harbour nearby w/ stunning views and very good architecture was roughly $50 w/ cart (very difficlult walk). I played on Labor day weekend at 1:00PM and basically had the course to ourselves. Couldn't beleive that.

The consumer makes the choice depending upon his comfort level. Right now it's definetly a buyrs market. Would be intereesting to hear how it compares to it's neighbors.

[Dan Herrmann]

Folks - you've got to check out John's Ravenwood.  It's near I-90, and looks awesome.  

I've not had a chance to play it yet, but it's definitely on my list of must plays....

[Jim_Kennedy]

Lou,
In the Gulf states the total revenues divided by the total number of rounds, in 2002,  yielded $28.09. Publics were at $22.38. The price point for publics is $26.52 for a standard value course.
(NGF)

[Jim_Kennedy]

Lou,
If the lessee knows what it will cost to improve the course vs. time left on his lease then he knows what price he needs to be at to make money. The question of can he/she get to this number is answered by the comparables.

[Lou_Duran]

Thanks, guys.

The gf at this course is at the high-end of an extremely thin market, but the facility is also several notches above the competition.  The operator does not lease the course, but actually has a contract to run it.  What I am trying to do is help this guy with some independent information that he can present to the community's decision makers so they can better understand the situation.  Ultimately, he is compiling information from many sources for the primary purpose of educating the community so that this very nice property can be maintained in the best possible way given some difficult financial realities.

[Don_Mahaffey]

Lou,
Without an comprehensive competitive anaylsis, it's very tough to identify a specific green fee the course should earn.
My simple brain has always looked at this issue in this way.
1. At lower end daily fees, traffic is the key. I've worked at lower end courses long enough to feel very strongly about this. Lowering the fees a bit to increase traffic has always increased the bottom line in my experience.
2. If the course is not operating at 70% or higher utilization then the fees are too high. In a price sensitive market, a dollar or two can make a difference. Getting people in the door is the key.
3. Don't raise the fees until the desired optimization is acheived. I've seen it happen numerous times where an operator let pride get in the way of supply and demand priniciples. We all think our golf courses are worth more. Doesn't matter what we think, only matters what the golfers think.

[George Pazin]

Wow, that's pretty amazing to me, Shivas.

Are you a golf snob? Seriously, do you not have any mom and pop $25 courses out there? There's probably a dozen courses within 30 minutes of my house that you can walk for $20 or less.

JohnV could give more exact numbers, but I can only think of one CCFAD in the area that is more than $75 (Olde Stonewall), plus the courses at Nemacolin (Mystic Rock $150+, Links course about $100). We have a handful of daily fees, brand new ones, really, that around $50 including cart. One of my favorites, Quicksilver, is $55 in season and $38 out (October through March).

[Tony_Chapman]

Lou - How strong are the ties of the golf course to this community? In some courses here in Nebraska, they have a "local" green fee and an "out of area" green fee. Is this something that could work at your friends course.

I played a nice Arthur Hills course (Legacy Ridge) this summer in Westminster, CO and the city - I believe - has some say in the golf course. I think green fees during the week were about $10 more than if I had lived in the county. That didn't bother me any.

If the locals still want the competitive prices, a nice way for some other revenue would be to add maybe 5 or 10 bucks to the green fee for an out-of-county or area resident.

[David Wigler]

Lou - it is all about location.

Las Vegas - $100 cheap - $150 affordable - $300 expensive
Northern Michigan $50 cheap - $100 affordable - $150 expensive
Detroit - $30 cheap - $50 affordable - $90 expensive

I had a friend who opened a course in Marshall, MI.  The course was leaps and bounds better than anything even close to it but at $55 for a round with cart, it could not run at a profit.  The price necessary to make the course great was more than the market would bear.  Move that course to Novi, MI and at $75 per round they would have made a fortune.  Move it to Las Vegas and at $125 a round they could have printed money.

[George Pazin]

Unfortunately, you'd probably pay a heckuva lot more for land, construction and upkeep in those other locales.

Related question: How much of a premium will people pay for superior golf? There's plenty of people in my area that I think would rather pay $20 for a "dogtrack" than $30 or more for a higher quality course. I'm still trying to figure out how Olde Stonewall is getting $100+ per round given the competition in the area. I have no idea how busy it is.

[A_Clay_Man]

The first time I ever had to pay extra, cause I was from out of town, was in Vegas. I was insulted and to this day can't figure out how in the world it can be legal to charge different people different prices for the same exact product. This is a great example of a loss of spirit the game has suffered from expanding too fast.

[Tim_Weiman]

Lou Duran:

In Cleveland, people are looking to pay somewhere around twenty dollars for 18 holes. Maybe a bit less during the week and willing to do a bit more on weekends. That is about the pricing for the Metroparks courses. The market also has many other courses for $25 or less, including one I paid $20 for this summer and thought it was so good I promised to say nothing but bad things about it! Can't we still have an occsional hidden gem?

As George Pazin suggested, once you go from $20 to $30, you lose quite a few people, especially since the $20 offerings could hardly be called "dogtracks".

One related question I think worth exploring: what about the bottom end? What pricing do you need to attract new people into the game?

A clue for this is found near my home where two nine hole beginner courses exist (Mastic Woods 1,900 yards and Little Met, a 2,600 yard design by, apparently, none other than Stanley Thompson). During the week you can play them for $6-7; on the weekends it goes up to $9.

At these courses you will find many parents trying to introduce their kids to the game as well as many young adults of apparently modest means. Also, you get a real clue as to how difficult golf really is at the bottom end: very few people can consitently hit a golf ball 100 yards. Hit a ball 200 yards and you stand out as someone who shouldn't even be there.

[George Pazin]

I'm not sure I agree, Adam.

I used to have a dream of taking an old abandoned steel mill in western PA & turning it into a public facility. Maybe bring in Tom D to fashion another TT. I'd rather it be available to locals than us GCA snobs. If you charge too little, tee times might get overrun by out of towners and the little locals who live in such a depressed area & can't afford big $$ might get squeezed out. I guess you could do something like Bethpage does with only locals being able to book in advance or whatever.

There's probably lots of locals in Vegas that couldn't afford to golf at higher non resident rates.

For us free market lovers out there, we'd say you can charge whatever you want to whomever you want. I don't believe in laws regulating the same prices for everyone. Kind of like auctioning off greens fees, no?

Me, I'd clearly charge you Chicagoans more, since you're used to it. Even more for Californians. And triple for NYers!

[Lou_Duran]

This course is municipally owned.  I don't know for sure how it was financed, but some public debt instruments were likely used.  The course was not expensive to build, and I doubt that debt service is very much.  It must be self-sustaining, so while some price differential for locals vs. visitors can be justified, it cannot be very large.  Like Adam, I don't like spending money just to travel to the course then to have to pay a much higher green fee.  I believe that this course has a small price differential, but it is under $5.
   

[John Foley]

Tim,

I think moving from $20 to $30 is the sweet spot for keeping the tee sheet full. Over $30, many average Joe's are going to think twice about repetedly sinking that number.

Dave,

Just to make you and the rest of the "high priced" area guys sick I could bring you to some unbeleiveable public places here in Rochester and you would be amazed the quality of the course you get for the price. Now some are busy and weekend AM tee times might be slim come Friday, but in general the calling all day to get a weekend tee time ain't happening here. We do consider ourselves very, very lucky. It's somehwat isolated. 75 min east & west are Buffalo & Syracuse. Both are woefull for good public access (though in Niagara Falls Canada the new developments are drawing in many US golfers).

On the bright side, you do have a number of other area's to spend your discretionary income on entertainment such as, shall we say, professional baseball?

Remember only a Red Sox fan can say that to a Cubs fan.

[Jim_Kennedy]

George,
I don't know if those Chicaoans are really used to paying as much as they would have you believe.  
There are 26 courses over 6,000 yards within 25 miles of Chicago that can be played for $50 or less. Extend that to 50 miles and the number jumps to 84.

[A_Clay_Man]

Geo- Basically what your doing is discounting and that leads to a loss of creditability.

Charge a fair price and where I live is not an issue.

The breakdown I've seen is; 80 percent of revenue is produced by 20 percent of play, when locals get a break. This leads to a resentment of the local whose responsible for 80 percent of play and only 20% of revenue. They seem to forget that while the locals only make 20 percent of tee sheet revenue each one of those individuals is spending a hell of a lot more throughout the year on other things, muc more than the once a year visitor.

Attitude is big. And dis-respecting me because I may be on Vacation or stuck somewhere and need to golf, is not an endearing persona.

[Jeff Goldman]

Shivas is right about Chicago folks.  Here, even the Munis (on the North side) are $40-50.  The most reasonable is probably Shepard's Crook, just over the WI-IL border in Zion, which is $35 walking for nonresidents.  Relatively new Keith Foster design with some really cool greensites, up the road a bit from Thunderhawk ($90-100).

Jeff Goldman

[Jeff Fortson]

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Jeff F.

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