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Bradley Anderson

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Re: Welcome To McRaynor's, A Business Plan
« Reply #75 on: November 19, 2012, 06:37:11 PM »
Hi Bogey,

I was assuming a $300-500k course maintenance budget, which excludes all other functions, with the general logistics of greeting and taking care of customers a significant expense.  I think a course would be hard pressed to keep its total operating budget under $1M.  $1.5M is probably closer to reality, which means your pessimism is justified.

John, There is a problem with operating a Raynor style course on a tight budget. That style requires extensive hand mowing around bunkers and the embankments of greens. I'm not saying that it would be impossible to do it at $500k but for sure you could pick a more affordable style to franchise/co-op.

For a maintenance cost of $300k your entire grounds staff, superintendent included, would only be 7-8 men. A crew that small isn't going to get a lot of hand work accomplished.
« Last Edit: November 19, 2012, 06:39:06 PM by Bradley Anderson »

SL_Solow

  • Karma: +0/-0
Re: Welcome To McRaynor's, A Business Plan
« Reply #76 on: November 19, 2012, 06:46:15 PM »
Really a terrific thread; thanks John.  I suspect the McRaynor portion was merely a way to try and incorporate the franchise idea, finding a model that works and that can be duplicated would defray at least a portion of the start up costs.  Of course,  the unique nature of each site makes it more difficult than building a fast food restaurant but there are likely to be some savings.  Others have discussed the cost of land acquisition.  To me, the real issue is determining demand.  We are overbuilt.  The suggestion to move to the inner cities  begs the question of whether the economics are likely to work in those areas absent a subsidy.  Is this an activity that will warrant a governmental subsidy in this environment?  If we go elsewhere, the suggested solution is to acquire existing underperforming courses.  I know a little about that process and it is possible.  But the reason they are underperforming may have a lot to do with oversupply.  One must be certain that along with a rational acquisition price, the owner/operator is buying a property that is susceptible to changes that will make it operate efficiently and that can compete for rounds with its competition.  If it does, those competitors are likely to feel economic stress and be required to make changes. This may drive the cost of golf down but will it result in an increase in rounds or will one merely see equivalent rounds at a lower price?  In each market, somebody will have to try to determine the elasticity of demand before making a long term investment.  There are certainly going to be opportunities to get into ownership more cheaply than in the recent past.  If the owner is so inclined, there  also will be opportunities to improve architecture and incentives to do so if the changes reduce maintenance costs, speed play and create interest.  But making it work financially will take a significant amount of skill and more than a modicum of good fortune.  Nevertheless, even if there is a significant contraction, there will be survivors and there will be opportunities to make intelligent buys/builds in a falling market.
« Last Edit: November 19, 2012, 08:59:40 PM by SL_Solow »

Mike Hendren

  • Karma: +0/-0
Re: Welcome To McRaynor's, A Business Plan
« Reply #77 on: November 20, 2012, 12:16:38 PM »
How frequently must greens and fairways be mowed?  I realize it depends on the season and grass type. 

What would be the cost savings of mowing greens every other day and fairways twice a week.  And never raking bunkers?

Sacrifices must be made somewhere to reduce operating costs, no?

Just wondering.

Bogey
Two Corinthians walk into a bar ....

Sven Nilsen

  • Karma: +0/-0
Re: Welcome To McRaynor's, A Business Plan
« Reply #78 on: November 20, 2012, 01:17:41 PM »
Has the 9-hole model with dual tees in places been considered? 

Land will cost less and will be easier to find, especially close to major population centers.
Maintenance costs will be lower.

Plus, you have the added tweak of trying to build "multi-template holes."  Imagine a par 3 that plays like a short from the up/left tees, but has eden qualities when played from the longer right tees.

"As much as we have learned about the history of golf architecture in the last ten plus years, I'm convinced we have only scratched the surface."  A GCA Poster

"There's the golf hole; play it any way you please." Donald Ross

Tom_Doak

  • Karma: +2/-1
Re: Welcome To McRaynor's, A Business Plan
« Reply #79 on: November 20, 2012, 02:21:31 PM »
How frequently must greens and fairways be mowed?  I realize it depends on the season and grass type. 

What would be the cost savings of mowing greens every other day and fairways twice a week.  And never raking bunkers?

Sacrifices must be made somewhere to reduce operating costs, no?

Just wondering.

Bogey

If you mow the greens every other day (in season when the grass is growing), the speeds are going to vary quite a bit from one day to the next, and it's pretty much universally established that customers won't like that.  You can make up for not mowing somewhat by speed rolling the greens on the off day, but you're not going to do a lot of rolling on a $300k budget, either.

Fairways can be mowed less often.  Bunkers could certainly be maintained a lot less.  But American golfers are very spoiled, so they will likely have something to say about it all.

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