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Tim Martin

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Re: The biggest waste of money within golf is .........?
« Reply #50 on: January 20, 2021, 07:28:09 AM »
In the UK, inland, is winter golf a waste of money for both consumer & provider?


I’ve played Winter golf forever in New England when conditions allow and love it. Pins in at forty degrees with high sun and light wind is a great day and one that I am way more interested in than ninety with humidity. Personally I haven’t seen a lot of turf damage but it’s certainly possible.
 

Kalen Braley

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Re: The biggest waste of money within golf is .........?
« Reply #51 on: January 20, 2021, 11:08:51 AM »
3 pages in and its hard to see a consensus on any one thing, even if there are 1/2 dozen leading culprits.  Perhaps this is why it continues to be an issue as agreement on what to fix is difficult...

John Kavanaugh

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Re: The biggest waste of money within golf is .........?
« Reply #52 on: January 20, 2021, 01:09:38 PM »
Fix. That's funny. Every single complaint is based in your own selfishness. Clubhomes, big headed drivers, fancy balls and green, green fairways wouldn't exist if they didn't make people who are most likely your friends happy.

Rob_Waldron

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Re: The biggest waste of money within golf is .........?
« Reply #53 on: January 20, 2021, 03:36:37 PM »
Excessive Clubhouses and F&B operations are the biggest burden and waste of money for daily fee courses. There is an exception for member owned clubs where they serve as an important amenity to attract and maintain members. Of course member owned clubs can also struggle with oversized assets that are unable to support themselves.


The pandemic has made many golf course operators realize that a scaled down F&B operation with minimal staff can actually be very profitable! Golf is a fixed cost business with higher operating margins while F&B is a variable cost business with low or no operating margins. Clubhouses are just overhead. The math is quite simple: it takes less operating profit to cover lower overhead costs.


Jeff_Brauer

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Re: The biggest waste of money within golf is .........?
« Reply #54 on: January 20, 2021, 04:27:04 PM »
I have worked with many muni management companies.  One told me that their highest F and B ROI was on snack machines.  The second was hot dog rotisserie, outdoor hamburger grills, and sandwiches.  The lowest was full-service restaurants. 


The best kitchen payback (really all payback) for any facility comes on 100+ person golf outings, where they are going to use your food service.  The second best on corporate Xmas parties, if you can book them, and lastly, weddings because individuals are sort of cash strapped, not to mention the wedding biz is in decline.



While there may not be a consensus on this thread, it seems to me the professionals are centering around the clubhouse, LOL.  Of course, as golf course architects, we feel obligated to say that, to preserve more capital for the golf course.
Jeff Brauer, ASGCA Director of Outreach

Peter Pallotta

Re: The biggest waste of money within golf is .........?
« Reply #55 on: January 20, 2021, 04:39:49 PM »
A question:
If an owner of a golf course is carrying/servicing no debt whatsoever, what is his single biggest annual expense?

David_Elvins

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Re: The biggest waste of money within golf is .........?
« Reply #56 on: January 20, 2021, 06:02:52 PM »
The best kitchen payback (really all payback) for any facility comes on 100+ person golf outings,


That may be true but I have seen too much dodgy accounting to believe it.


I remember one club's financial report that allocated all guest green fees as pro shop income and all golf outings as clubhouse income.


According to their financial statement, the course that was top 30 in Australia was a marketable drawcard was doing 60,000+ rounds a year and losing money whilst the clubhouse that had just had a $5mil refurbishment was making money.


Its far from the only club I have seen that has not been honest about costs and revenues.

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Matt_Cohn

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Re: The biggest waste of money within golf is .........?
« Reply #57 on: January 20, 2021, 08:50:19 PM »
Rough.

Mike_Young

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Re: The biggest waste of money within golf is .........?
« Reply #58 on: January 20, 2021, 08:53:43 PM »
A question:
If an owner of a golf course is carrying/servicing no debt whatsoever, what is his single biggest annual expense?
In many cases it would be property taxes...
"just standing on a corner in Winslow Arizona"

MKrohn

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Re: The biggest waste of money within golf is .........?
« Reply #59 on: January 20, 2021, 10:24:53 PM »
The best kitchen payback (really all payback) for any facility comes on 100+ person golf outings,


That may be true but I have seen too much dodgy accounting to believe it.


I remember one club's financial report that allocated all guest green fees as pro shop income and all golf outings as clubhouse income.


According to their financial statement, the course that was top 30 in Australia was a marketable drawcard was doing 60,000+ rounds a year and losing money whilst the clubhouse that had just had a $5mil refurbishment was making money.


Its far from the only club I have seen that has not been honest about costs and revenues.


F&B revenue depends on geography, club wages in Australia make it very difficult to generate income.


David, I have waxed and waned over the years on how much detail I want included in the clubs accounts.


At the clubs I have been involved, they break things down to the minutiae but to what end, your example above is true to some degree everywhere. You need a number of elements agreed with your membership to function, they simply fit under the member services model. We know over many years F&B is flat to a cost and control of the services/wages trade off is something that changes outcomes. I am a small club model guy probably because it suits me and also I've yet to see anyone be a raging success from running the big clubhouse/function model.


Pandemic has been good for golf clubs in Aust, member revenue unchanged to increasing, government paying wages, no F&B.




Jeff Schley

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Re: The biggest waste of money within golf is .........?
« Reply #60 on: January 21, 2021, 05:07:57 AM »
Surprised no one has mentioned cart paths as we have pro walking contingent here certainly.
I do really think the all grass walking path at Ballybunion for example are spectacular.
"To give anything less than your best, is to sacrifice your gifts."
- Steve Prefontaine

John Kavanaugh

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Re: The biggest waste of money within golf is .........?
« Reply #61 on: January 21, 2021, 05:12:35 AM »
Surprised no one has mentioned cart paths as we have pro walking contingent here certainly.
I do really think the all grass walking path at Ballybunion for example are spectacular.


Cart paths were mentioned. I was triggered.

Jim Sherma

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Re: The biggest waste of money within golf is .........?
« Reply #62 on: January 21, 2021, 08:48:13 AM »
The cart path question never seems to have a definitive answer. There is obviously the cost of the paths themselves, generally singular large outlays with zero cost years in between rebuilds.


This is at least partially offset by the turfgrass maintenance due to cart damage that the paths prevent you from having to absorb.


The size of these trade-offs is probably a course by course calculus that depends on many different factors. The fact that cart revenue, capital expenditure of path build/maintenance, and turfgrass maintenance budgets very likely end up in different parts of the financial statements certainly limits the transparency of any decisions.

Bruce Katona

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Re: The biggest waste of money within golf is .........?
« Reply #63 on: January 21, 2021, 01:59:51 PM »
Jeff_Brauer:

IMH experience, you're spot on; the best F&B ROI we had when I was working with Archie Struthers was the hot dog grill - $5/$6 for a large hot dog on a Portuguese roll and a fountain drink (no beer & wine licenses in NJ - either you can serve everything or nothing).  Total cost of the food & beverage $1, labor cost $1 (including benefits) - all in for $2 max......


Selling beer is a great income source if the public access club can secure a liquor license.....private clubs have different liquor rules in NJ (some pre-date Prohibition and need to be modified but that's a difficult political process).

SB

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Re: The biggest waste of money within golf is .........?
« Reply #64 on: January 25, 2021, 12:09:02 PM »
I was thinking about this question and really like John's answer that whatever you don't want is what is the biggest waste of money.   ;D


Another way I was thinking about it is: what areas have the biggest propensity to waste money, with wasting money defined as: spending more than what a reasonably efficient operation would spend.  For example, if everyone else in a particular market is spending X on golf course maintenance, and you are spending double that for no particular reason, then you are wasting money.


Admittedly, most of the courses that I see are failing in one way or another, so it could definitely be a skewed sample, but my sense is that other clubs have similar problems, they just have the revenue to cover up the issue.  If your club is sinking, you would think that someone would say, "let's just spend a normal amount on XXX" instead of what we are.  But nearly every club that I see has at least one area that is a disaster, and it may surprise you that it is different in almost every case.


On the daily fee side, as Rob says, it's usually in the clubhouse/F&B.  I think COVID has really opened some eyes that a full restaurant is not necessary, though.  I don't see a ton of waste in maintenance, as a matter of fact, it's probably just as common to spend too little.


On the private side, it's all over the board.


It will not be surprise that the majority of the clubs I see are not doing a good job in F&B.  And my standards are pretty low.  Losing money is common, but if you're sinking, you should try to do better than lose $1M a year on F&B. 


Golf course maintenance is probably the second biggest culprit.  I've seen a LOT of clubs in distress where they are spending 50-75% MORE than everyone else in the market, and it ain't because of the design.  That's hundreds of thousands of dollars.  It's usually labor, although with excessive equipment leases are pretty common.  I saw one club that had been struggling for a number of years, yet their board approved a lease package that cost $400,000 A YEAR, and it wasn't like conditions were bad before that.  It included a new $70,000 BACKUP fairway mower and a $25,000 BACKUP aerator among other things that they didn't really need.  And yet there were rocks the size of golf balls in the bunkers because that wasn't a priority.  The club went bankrupt, by the way, because they were losing about $400,000 a year.


Right behind is G&A and it is a huge rabbit hole.  It's mostly overpaid staff or too many staff members.  I've seen clubs struggling, yet paying $350,000 for a general manager, or somehow finding enough work for 5 full time accountants. And I've lost track of the number of places you can find $10K here and $20K there in this department.  $15K for a postage meter (plus the postage) when everyone is emailed their statements, yep.  $25K a year for a copier, sure.  The list goes on and on.


Property taxes can be a huge waste if you're not all over it.  A buddy of mine does tax appeals and saved courses as much as a hundred thousand a year.


I find very little waste in the Pool, Tennis, Fitness, Pro Shop, or Range.