Right now, at a golf course somewhere in Canada, you can almost bet that in the boardroom or manager’s office, or maybe even at a table in the lounge, the topic of discussion isn’t what to do with all the money that’s coming in.
No, the conversation is likely about how to get money to replace the roof, touch up the locker room, make course improvements, etc., etc. Indeed, if your golf club is like many these days, growing revenue can be as challenging as growing grass in the parking lot.
“If you can’t drive revenue, your club is at risk,” says Henry DeLozier, a partner with Global Golf Advisors. The international company provides advisory services to golf clubs and other businesses and associations that serve the industry.
Speaking at the PGA Show in Orlando, DeLozier, a leading authority on golf course asset management and financing, emphasizes that building that revenue isn’t a one-man show.
“Building revenue is everyone’s job,” DeLozier says. “If you’re the leader, what’s important to you (about generating revenue) should also be important to subordinates.”
In other words, in a perfect world, all areas of the club are on the same page when it comes to thinking about how best to benefit the bottom line.
Alan Carter, general manager at the Edmonton Country Club, agrees.
“Every area of the club impacts each other. You have to make sure that everyone understands each other’s role.”
Carter, who previously spent 20 years at the Fairmont Jasper Park Lodge Golf Club in Jasper, Alta., says communication is critical.
“You need to understand that you’re not in your own little area. If one area of the operation slips, it can affect the overall operation. Everyone needs to be on board for providing the best customer experience possible.”
The idea of everyone contributing to the bottom line could be something as simple as a back shop worker suggesting to a member that their grips are worn, or even someone in the pro shop recommending a delectable item on the dining room menu. It all adds up.
Needless to say, grip and food sales won’t make or break a club’s year. That’s where high-yield revenue categories, as DeLozier calls them, come in. These, he emphasizes, are where clubs need to focus their energies, adding that “revenue generation equals growth opportunities.”
On the private club side, the revenue growth categories are membership dues, capital dues, guest fees, cart fees, range fees, club storage and catered events. Daily fee clubs need to focus on green fees, member dues, special events/outings, cart fees and range fees.
Says DeLozier: “Make small increases in high-yield revenue items. If you don’t get the little money, you won’t get the big money.”
Trouble is, if you look at your club and others in the area, everyone is fighting for a chunk of the consumer pie. Too many courses and not enough golfers — a tired refrain, yet a supply-demand reality that will continue to exist until we find a magic formula to get those with the money — baby boomers and millennials — to work golf in among the many other distractions that preoccupy their time.
That’s why, DeLozier says, it’s important to leave no stone unturned when it comes to looking for ways to generate revenue. A great way to get the ball rolling is to create and use a ‘revenue menu’.
“Think about all your available revenue sources,” DeLozier says. “Know what most drives your revenues, patiently try to increase them, and constantly track and know where these revenues stand.”
Key tactics on that menu should be to:
- Increase rounds played through non-dues golf rounds (guest play) and events. This should be a priority for every pro.
- Win the kids and you win the moms; win the moms and you win the game. Treat children well – it’s good business.
- Reward customer loyalty, but reward it only when you get what you want (buy 10 buckets of balls, get one free, etc. etc.).
- Cause customers to earn discounts. When you do a points program at your club, be sure it doesn’t become a problem with customers looking for more.
- Make instruction a priority. Revenue comes in different ways, not only directly.
As for food and beverage and retail sales, DeLozier believes food and beverage is a break-even proposition at best when you factor in labour and vendor costs, while retail is faced with combating the trend toward online sales.
“If you’re going to be a retailer, the retail experience you offer has to be exceptional. You can’t offer garden-variety goods that can be bought online.
“As well, pros need to develop their selling skills. To prosper as a pro, you have to be an expert.”
Get everyone at your club thinking about ways to generate revenue. Always keep two questions front and centre: Does your job involve revenue growth? How do you generate revenue for your employer?
As DeLozier says, increase revenue, and you increase your value to your employer.
And getting comfortable shouldn’t be an option. As Alan Carter says, “we’re good, but next year we want to be even better.”
