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Kalen Braley

  • Karma: +0/-0
Re: Brora, a "Very Special Place"
« Reply #50 on: November 13, 2018, 02:33:50 PM »


Kalen,

that you think the typical members' club in the UK suffers the '
inconvenience of visitors crowing the pro shop and taking your slots' show how little you understand the market over here.
Jon

Jon,

I will stipulate... I was just going off the many responses in both this thread and other recent ones which would indicate its either a concern or a growing one.

Don't get me wrong I'm a big fan of the UK model, I would much rather pay a reasonable yearly fee and deal with strangers lurking on the course from time to time ;)

P.S. Remember as Barney said years ago...the US model in large part is not based on who you let in, but who you can keep out!  I believe that to be correct!

Ken Moum

  • Karma: +0/-0
Re: Brora, a "Very Special Place"
« Reply #51 on: November 13, 2018, 03:31:43 PM »
Ken,


how many world top ten golf clubs in the US are there where the YEARLY fee for membership is under £600? and how many of them let the likes of you or me on to them to play? To be fair it is only really 3 month where the tee is very busy so I do not think it is too bad and I suspect that Dornoch could stop all outside play and still survive on the membership fees. As for the exclusive nature of many US courses. If I was paying the stupid amounts asked by many of them I would be pretty pissed off if I could not just walk on to the course but then I would have no interest in being a member of such a course as it has little to do with what golf is about for me.

Jon


That's 100% about the kind of U.S. privates that get mentioned on here, and it's also true of the privates in some areas of the country. 


Having spent a lovely day with you on Tain, however, I think I could easily find plenty of private clubs here that would meet your standard for membership. Obviously the golf course might not be up to the standards of most links courses, but they'd probably stand up to the likes of Alness.


Anyway, as David said it's a balance, and I still think it would irk me to have to put up with the RDC level of outside play even for three months.


And for reference, my brother just inquired about a membership at a nice golf-only club here in Mesa and said it wasn't as bad as he thought.  It's a wee bit more than 600 GBP annually. 


Actually, $3500 initiation (not refundable I think) and over $550 a month for 12 months, including the weeks when they close for overseeding.


And it's not famous.


One problem we haev here is that a majority of our courses are in areas when growing the cool-season grasses golf was invented on are sketchy at best.  Hell, in Topeka, which is in the transition zone, municipal courses with only average conditions have greenkeeping budgets of $500,000 or more.


So the business of using visitor green fees to subsidize the member's subs is something I wish we'd do here. (maybe I'd get on some of those courses I can't afford to join.)


But it is still a balancing act.


K
Over time, the guy in the ideal position derives an advantage, and delivering him further  advantage is not worth making the rest of the players suffer at the expense of fun, variety, and ultimately cost -- Jeff Warne, 12-08-2010

Niall C

  • Karma: +0/-0
Re: Brora, a "Very Special Place"
« Reply #52 on: November 14, 2018, 08:49:05 AM »
"Golf doesn’t have to be expensive. Seems like most if not all U.K. links courses/clubs could get by with only a tiny clubhouse. Indeed in centuries gone by the local pub often sufficed. Clubhouses are a lot about ego, vanity and showing off, not about the golf. Combining a lessor clubhouse with the use four legged grazing friends doesn’t half help keep the subs down."

Thomas D. -

Sorry, but your gazing into the past misses the point. The reality is golf tourism is a major benefit to the economy of Scotland, responsible for 4,700 jobs and over 280 millions pounds of revenue. I suspect the "knock on" effect is even greater, when factoring in the revenue/jobs from the hospitality industry.

https://www.scottishgolf.org/golf-tourism-driving-scotlands-economy/


Having a golf course & facilities that attract visitors helps keep a number of villages in Scotland alive. It also enables a golf club to generate enough revenue to staff their golf shop and their bar/dining room.


Granted, there is a "tipping point" when visitor activity may start to crowd  out the local members and devalue the worth of a membership. I suspect 90+% of the golf clubs in Scotland are very far away from there.   


DT

David & David

As we (David Thomas and myself) found out at Westward Ho, having livestock on the course isn't always pain free. But generally I agree that there's no need for large establishments. Of course some clubs manage to afford to build larger clubhouses but in reality how many golfers go to Nairn or Dornoch for the clubhouse (or in the case of Nairn, despite the clubhouse  ;D) ? Or another question - how many are now regretting grand clubhouse schemes they did in the good times ?

Another thing to remember is that a lot of these rural courses were actually set up with visitors in mind and that was back in the day when they would be lucky to have a corrugated tin shed for a "clubhouse". That hasn't put visitors off over the years and I don't think any new clubhouse at Dornoch will lead to more visitors either.

Niall

Lou_Duran

  • Karma: +0/-0
Re: Brora, a "Very Special Place"
« Reply #53 on: November 14, 2018, 10:34:37 AM »
I don't know the RD membership, but might they see building a new clubhouse largely funded by visitor fees as a way to enhance their enjoyment of the club for relatively little personal cost?  Isn't that how many cities in the U.S. (and London if the fees at LHR are an indication) fund airport, public and some private projects by piling taxes on visitors (landing fees, hotel, car rentals).

If visitors at RD are only a "problem" three months of the year, but generate substantial revenues allowing subscriptions to be kept low while still building large reserves, what should the club do?  BTW, I was there on three near-perfect days in August and the tee sheet was not full- members and visitors had reasonable access to the course.

Having seen in the corporate world how building expensive administrative structures detracted from management's focus during planning, construction, and a period following move-in, as well as financial flexibility during the down times of the business cycle, I am not big on such things as headquarters or clubhouses.  I would normally prefer investing available funds in productive capacity- say a second course of similar caliber if the demand exists- but that is not to say that a new clubhouse is necessarily unproductive or, that it would not be a valuable amenity that any number of members would enjoy.

     

Jon Wiggett

  • Karma: +0/-0
Re: Brora, a "Very Special Place"
« Reply #54 on: November 14, 2018, 12:20:36 PM »

Lou,


the 'mine is better than yours' mentality really does not exist up here so for the members if the clubhouse fulfils its' function then why change.


Jon

David_Tepper

  • Karma: +0/-0
Re: Brora, a "Very Special Place"
« Reply #55 on: November 14, 2018, 03:36:57 PM »
"But generally I agree that there's no need for large establishments. Of course some clubs manage to afford to build larger clubhouses but in reality how many golfers go to Nairn or Dornoch for the clubhouse (or in the case of Nairn, despite the clubhouse  ;D) ? Or another question - how many are now regretting grand clubhouse schemes they did in the good times ?"

Niall -

I made no suggestion in my post that large establishments/clubhouses were needed to attract visiting golfers. I was simply reminding Thomas D. of the reality that any golf club seeking to attract visiting golfers on a recurring basis needs more than a "tiny clubhouse."

DT

Thomas Dai

  • Karma: +0/-0
Re: Brora, a "Very Special Place"
« Reply #56 on: November 14, 2018, 04:43:18 PM »
"But generally I agree that there's no need for large establishments. Of course some clubs manage to afford to build larger clubhouses but in reality how many golfers go to Nairn or Dornoch for the clubhouse (or in the case of Nairn, despite the clubhouse  ;D) ? Or another question - how many are now regretting grand clubhouse schemes they did in the good times ?"
Niall -
I made no suggestion in my post that large establishments/clubhouses were needed to attract visiting golfers. I was simply reminding Thomas D. of the reality that any golf club seeking to attract visiting golfers on a recurring basis needs more than a "tiny clubhouse."
DT
I would suggest that what's needed in the first place is a decent golf course in decent condition. As to details provided by Scotlandgolf, well given comments made herein over the period I'm not convinced that too many have confidence in that organisation.
As to over-ambition, pitfalls and clubhouses, consider Narin & Portnoo.
atb


Jon Wiggett

  • Karma: +0/-0
Re: Brora, a "Very Special Place"
« Reply #57 on: November 14, 2018, 05:21:05 PM »
"But generally I agree that there's no need for large establishments. Of course some clubs manage to afford to build larger clubhouses but in reality how many golfers go to Nairn or Dornoch for the clubhouse (or in the case of Nairn, despite the clubhouse  ;D) ? Or another question - how many are now regretting grand clubhouse schemes they did in the good times ?"

Niall -

I made no suggestion in my post that large establishments/clubhouses were needed to attract visiting golfers. I was simply reminding Thomas D. of the reality that any golf club seeking to attract visiting golfers on a recurring basis needs more than a "tiny clubhouse."

DT



Indeed David, but I would humbly point out that the clubhouse at Dornoch has not held the club back to date as the membership has wisely realised.

Lou_Duran

  • Karma: +0/-0
Re: Brora, a "Very Special Place"
« Reply #58 on: November 14, 2018, 05:33:32 PM »

Lou,


the 'mine is better than yours' mentality really does not exist up here so for the members if the clubhouse fulfils its' function then why change.


Jon

I wasn't aware that the Scots were that much different than their American cousins.  Not as competitive?  Perhaps more practical?  Frugal?  Has the new clubhouse proposal been shot down?

For anyone with knowledge of Scottish law, can a golf club such as RD hold large cash reserves without tax consequences?  I am assuming that it operates for the benefit of its members as a non-profit entity, but perhaps that is wrong.  Just curious.


Ryan Coles

  • Karma: +0/-0
Re: Brora, a "Very Special Place"
« Reply #59 on: November 14, 2018, 05:52:57 PM »

Lou,


the 'mine is better than yours' mentality really does not exist up here so for the members if the clubhouse fulfils its' function then why change.


Jon

I wasn't aware that the Scots were that much different than their American cousins.  Not as competitive?  Perhaps more practical?  Frugal?  Has the new clubhouse proposal been shot down?

For anyone with knowledge of Scottish law, can a golf club such as RD hold large cash reserves without tax consequences?  I am assuming that it operates for the benefit of its members as a non-profit entity, but perhaps that is wrong.  Just curious.


Lou


In the UK, Members Clubs are subject to corporation tax on trading profits. And in certain circumstances, capital gains tax. There is no tax for holding cash reserves.


The doctrine of mutuality applies to member generated revenue.


The bigger the Club, the better the accountant......Lots of very wealthy Clubs manage to take millions in non member income and still show a trading loss.


Local clubs in my area taking 60k in greenfees somehow manage to have a bigger corporation tax liability than the sunningdales and Berkshires of this world who take 20 times that per annum.


HMRC also made a rebate on VAT (sales tax) and again the bigger the Club, the bigger the payout. Royal Dornoch probably received somewhere in the region of 500-600k and it’s burning a hole for many. Lots of frilly edged rubber crumbed bunkers going in all over the UK at great expense.


Before the payout, most members Clubs in the UK even the upmarket ones were actually cash poor with even top 100 clubs running on bank overdrafts. Quite strange but I suppose they all thought or think the good times would never end but the last downturn hurt even the big guns as much of the corporate days they relied on dried up for a few years.


On the other hand, investment returns are so poor that Club’s probably felt it better to invest than risk the capital.


Members Clubs and their committees also get hung up on capping subs levels and that years p&l account, where despite showing a surplus in accounting terms they are losing cash because they are borrowing for Capex/ machinery and not passing on the cost.


But lower subs and a small accounting profit look good at the AGM, to hell with the fact they’re out of cash and one bad summer from being cap in hand to the bank.






« Last Edit: November 14, 2018, 06:12:10 PM by Ryan Coles »

David_Tepper

  • Karma: +0/-0
Re: Brora, a "Very Special Place"
« Reply #60 on: November 14, 2018, 07:53:58 PM »
"Indeed David, but I would humbly point out that the clubhouse at Dornoch has not held the club back to date as the membership has wisely realised."

Jon W. -

You are right. But no one would argue (including myself) that Dornoch has had a "tiny clubhouse" for these many years. ;)

"I would suggest that what's needed in the first place is a decent golf course in decent condition."

Thomas D. -

You are right and I agree totally. That being said, having a clubhouse that can provide food & drink to visiting groups of 10 to 20 golfers, a pro shop that offers a modest assortment of logo-ed goods and a locker room with showers (and hot water!) can only enhance the odds that visiting golfers will return or recommend the course to their friends when they get back to their home club.

DT     

Lou_Duran

  • Karma: +0/-0
Re: Brora, a "Very Special Place"
« Reply #61 on: November 14, 2018, 08:18:36 PM »
Thanks Ryan.  Had to look up the "doctrine of mutuality" and found a relevant court case in India where a club which held members' deposits in an interest bearing account at a bank was liable for taxes on that interest income.  And yes, it is human nature to want to spend what's in the kitty. 

Jon Wiggett

  • Karma: +0/-0
Re: Brora, a "Very Special Place"
« Reply #62 on: November 15, 2018, 02:00:51 AM »

Lou,


the proposal has been rejected twice. I think the main reason is that the clubhouse whilst small on some days in the year is actually more than adequate for the membership's needs for most of the year. It is in fact considered to be quite a plush by most local golfers. The tax burden on private members' clubs is not so big.


Jon

Niall C

  • Karma: +0/-0
Re: Brora, a "Very Special Place"
« Reply #63 on: November 15, 2018, 08:02:01 AM »
"But generally I agree that there's no need for large establishments. Of course some clubs manage to afford to build larger clubhouses but in reality how many golfers go to Nairn or Dornoch for the clubhouse (or in the case of Nairn, despite the clubhouse  ;D) ? Or another question - how many are now regretting grand clubhouse schemes they did in the good times ?"

Niall -

I made no suggestion in my post that large establishments/clubhouses were needed to attract visiting golfers. I was simply reminding Thomas D. of the reality that any golf club seeking to attract visiting golfers on a recurring basis needs more than a "tiny clubhouse."

DT

David

My comments were meant to be relative so perhaps I should have said larger rather than large. My point however remains the same, no one goes to a golf club for the clubhouse and while a clubhouse might add to the experience for the visitor it isn’t the reason for the visit and in itself won’t bring them back.

In my view, increasing the size of the clubhouse should only be done to suit the members and even so only if it can be afforded on a sustainable basis. By sustainable I mean not making assumptions that the good days will last and that you will always have visitor income to not only pay for the build but also the increased running costs.

That said, that's just my view and the membership in general might think different. Each to their own.

Niall

Tony_Muldoon

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Re: Brora, a "Very Special Place"
« Reply #64 on: November 15, 2018, 08:14:51 AM »

Ken,


whilst there are some who spread slurry on their land this is always animal based (sheep, cows & pigs). The spreading of human waste on land has been banned for several decades now.


Jon


Jon and others, far from being illegal most slurry is treated human waste. In Scotland around 200,000 tonnes a year of “sewage slurry”, a polite way of saying treated human waste is spread on the land.


https://www.gov.uk/government/publications/sewage-sludge-in-agriculture-code-of-practice



Mark,


I stand corrected. I knew there was a ban on it with grazing and arable land but had not realised it was still allowed on other area.


Ken,


I apologise for ever doubting you.


Jon




+1
Let's make GCA grate again!

Ken Moum

  • Karma: +0/-0
Re: Brora, a "Very Special Place"
« Reply #65 on: November 15, 2018, 04:20:54 PM »
In my view, increasing the size of the clubhouse should only be done to suit the members and even so only if it can be afforded on a sustainable basis.


By sustainable I mean not making assumptions that the good days will last and that you will always have visitor income to not only pay for the build but also the increased running costs.

That said, that's just my view and the membership in general might think different. Each to their own.

Niall


I've been calling that Country Club Disease for at least three decades, and if you think it might happen here and there in Scotland, it's practically an epidemic in the parts of the U.S. that I've lived in.


The course i grew up on, the course I played in South Dakota, the country club I joined in Kansas and the club my parents joined in after retiring were all sunk, or nearly sunk by clubhouse debt.


The first one was bailed out by a group of local "angel" investors who saw the place as important to our little town. Without their money, I'm not sure where the club and course would have gone.


The second had gone under as a private club shortly before I moved to Pierre having been owned by a country club and an Elks Club. The city was leasing it and there were shoulder-high kochia weeds in the bunkers. The city later bought it and it's been operated as a muni since the late 1970s.


The third was a thriving club in 1988 when a fire destroyed the clubhouse.  The Board at the time wasn't satisfied with rebuilding on the insurance money. So they borrowed about $1.2 million to build an edifice.  It was porrly designed and used materials that required too much maintenance.


When I joined in the late 90s the club was still carrying almost a million dollars in debt and didn't reduce it at all while I was there.  In the end the bank took it over after about 25 years and it is now operated by Great Life Golf and Fitness, who I think bought it for about the debt.


My mother's club is still okay but has had some tough times over the years.  I don't recall how long ago, but the board proposed a new clubhouse and members voted it down.  The had to authority to remodel without approval and when the demo was done there was almost nothing left but a bare concrete slab. IIRC they spent more than $3 million.


Having asked questions of some of the people involved in these decisions the usual answer was that the clubhouse was going to subsidize the golf course with all the "events" they were going have. It's fantasy land, because F&B pretty much never makes a profit at private clubs unless you do the accounting without charging F&B for any of the clubhouse overhead.


At my club in Kansas, the only costs F&B showed in the books was labor and materials.  Worse, the golf course budget didn't show one dime of income.


A longtime member and several time board member told me, "(the superintendent) and his crew do great work but they're just a drag on the budget. Without Food and Beverage we'd have gone under a long time ago."


!!!!!!!!!!!!!!!!!!!


K
Over time, the guy in the ideal position derives an advantage, and delivering him further  advantage is not worth making the rest of the players suffer at the expense of fun, variety, and ultimately cost -- Jeff Warne, 12-08-2010

Lynn_Shackelford

  • Karma: +0/-0
Re: Brora, a "Very Special Place"
« Reply #66 on: November 15, 2018, 05:57:05 PM »
One of biggest misconceptions and misunderstandings of golfers who have never been in the business of golf is the clubhouse.  Most think a larger building or with banquet opportunities can add to the bottom line.  However the cost of constructing, funding this and then operating it(upkeep) usually makes it a major financial burden on the expense side with disappointing results on the revenue side.  As mentioned above the F&B component is seldom a major money maker.
It is like adding a tree on the course.  There is the purchase cost, planting and then years later the trimming cost.  The hidden costs are the increased upkeep on the ground around the tree as turf is more challenged without adequate sun or air circulation.
After 2008 many courses in the USA went under, a majority due to clubhouse debt and clubhouse maintenance costs.
I hope Royal Dornoch sticks with their present facility.  Brora and Golspie too for that matter.
It must be kept in mind that the elusive charm of the game suffers as soon as any successful method of standardization is allowed to creep in.  A golf course should never pretend to be, nor is intended to be, an infallible tribunal.
               Tom Simpson

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