The Road to RecoveryOperating a Profitable Golf Business

Market Conditions

• A reduction in capacity• strategic reduction of up to 50 golf courses

• coordinated amalgamations on a regional basis

• Return to growth in golf club affiliations• once a golfer, always a golfer

• develop a national infrastructure to encourage growth

• Appropriate pricing strategies adopted by the Appropriate pricing strategies adopted by the industryindustry• below cost pricing to be resisted

• Golf businesses working together on a regional basis• businesses cooperating to broaden the offering &

improve promotion

National Strategic Vision - IAGC• Existing representation of stakeholders is

fragmented

• GUI, ILGU, PGA, GCSAI, GCOA, IGTOA & CMAE are

examples

• A national body representing the industry,

specifically businesses is required

• other industry bodies include IHF, LVA, RAI, IBEC, SFA

Childcare

• Such an organisation can lobby on

behalf of its members• JLC regulations and rates• Fáilte Ireland / Tourism Ireland• VAT regulations• local authority rates• facilitate group purchasing schemes• chemical usage

Key Factors to a Profitable Golf Business• Strong Management

• Broadening the Consumer Base and Revenue Streams

• Increasing Revenue & Yield Management

• Maximising Efficiencies & Controlling Costs

Strong Management• Profitable golf businesses need more than administrators

• strong front of house qualities are essential

• must understand hospitality management

• ability to communicate clearly and affectively

• marketing / promotional skills are necessary

• must be capable of selling

• Management Structure must be streamlined & efficient

• effective decision making is critical

Strong Management (cont’d)

• Golf businesses must adopt a strategic plan

• less than two in every three clubs have a plan

• 64% of clubs with a plan reported increasing membership

numbers

• 3rd party assistance may be required

• Golf businesses require full time management

• owners / members must work closely with management

• businesses without a manager should appoint one

or outsource to a company

• Committees have their place but professionals

are required

Broadening the Consumer Base& Revenue Streams

• Broaden the membership offering to attract new

customers

• Provide different experiences and develop consumer

choice

• Bundle products & services more effectively

• Exploit all facilities to develop new revenue streams

• Work within the community to develop new

opportunities

Revenue• Invest in sales & marketing initiatives

• recruit experienced professionals or outsource• improve the ability of the business to capture & build databases• know your customers & align your offering to suit• exploit online sales tools• work together within groups and with competitive set

• implement a differentiated promotional campaign to specific consumer groups

• Implement membership retention initiatives• recruiting new members is 5 times the cost of retaining an existing member• develop programmes for integrating new members• enhance communication between the club and its members• provide benefits of membership that add value• improve customer service, the members experience & the product

Revenue cont’d• Implement membership growth strategies

• broaden the membership base to attract new customers

• add value to the membership

• clearly communicate the membership offering

• clearly define the sales process and instill a sales focus

• monitor performance at generating and converting leads

• Embrace technology & online booking engines

• provides a platform to drive green fee revenue

• allows for implementation of yield management initiatives

• provides the ability to adapt quickly to changing consumer demands

Maximize Efficiency & Control Costs• 58.1% of clubs have reduced their costs

• Examples of the highest paid people within the club made redundant

• Service levels and the product are suffering

• Cost savings should be achieved through efficiencies, rationalisation and a better managed business

• Cuts imposed on promotion, management and services levels should be assessed as part of an overall plan

Maximize Efficiency & Control Costs

• Participate in group buying schemes to assist in reducing costs

• materials, inputs, direct costs & services• Share assets such as course machinery with other golf businesses• Consider outsourcing various aspects of the operation

• management• course maintenance• sales & marketing• clubhouse maintenance, food & beverage, merchandise

• Adjust resource structure to reflect seasonality of the business

• change in working conditions, less full time staff, centralise certain functions

Key Considerations