By Alan Prescott
January 25, 2021
“Lack of funding is a MAJOR factor in golf course failure.”
It must certainly be on the minds of many who have read my last article, The Death of a Golf Course, about what finally has transpired. Several years ago, before Ken died, he was offered 6 million dollars by the local government to sell his golf course. He had paid only 3.5 million dollars to purchase it. At the closing, he changed his mind and said that he wanted 7 million dollars. The deal was dead. Ken really wanted to have a place to come to work everyday. But, that’s getting away from the point of this discussion.
Almost from the day that Ken purchased Castle Country Club, he did the absolute minimum to maintain the golf course. His employees were overworked, the course was understaffed, and the clubhouse was neglected. For the last 10 years, the golf course was NEVER adequately maintained. The greens were never verticut, or aerated, or properly treated with fertilizer or chemicals. When I walked away, the end result was that at least 8 of the 18 greens needed to be replanted 100% and the other 11 were in extremely poor condition, the result of lack of fund allocation by the bickering brother and sister. Lack of funding is a MAJOR factor in golf course failure.
So, how have golf shops, driving ranges, and golf courses responded to a changing golf business landscape. Let’s begin with golf shops. In the early 1970’s, sporting goods stores sold golf clubs that were different from those sold exclusively by golf professionals at golf courses. Both types of clubs were very rudimentary compared with today’s offerings. When golfers, that were not members of private courses tried to purchase them, they had to go to the local golf courses and purchase them at list price from a local PGA professional.. But, people were getting tired of paying the list price for better golf equipment.
Other business owners saw a great opportunity to get into the golf business. They purchased golf courses and hired a resident golf professional, who could buy the top-grade golf equipment. Then, they opened up off-course retail golf shops and stocked their shops with professional golf equipment. Some built or purchased golf driving ranges. At the time, the golf club manufacturers would ship driving ranges if they had a golf professional and if the facility was an open air facility. One golf club manufacturer, Karsten Manufacturing Company of Phoenix, Arizona (you know them as the manufacturer of PING golf clubs) made sure that their golf clubs were sold, at first, only at golf courses by calling up the prospective golf club account and asked if they could book a tee time at their facility. When the store owner said that they didn’t have tee times because they we a retail store, they hung up and rejected their golf club orders.
But, off-course golf shops found a way to fit and sell golf clubs. And, that discussion is part of my next article. I am delaying that discussion due to the volume of responses that I have received that I have received in response to my request for opinions and suggestions. I am very concerned about your golf course facility and, first, I will begin with “golf gimmicks” and their effects on the revenues of open-air facilities.
From indoor golf hitting mats where golfers would hit into indoor golf nets, to golf ranges with mats to hit on, to indoor golf shops with simulators, and more, the golf participation landscape has definitely changed. Golf course greens fees have, at most or all courses, have gone up. And, the cost of golf course maintenance has gone up as well. Golf course owners, whether private, public, resort, or municipal, have looked for other options to add to their revenue streams. Halfway refreshment booths, on-course drink and snack carts, enhanced snack bars indoors, and expansions are part of these options. Golf practice ranges, most times, are only a break-even proposition.
There is yet another option available for those with deep pockets. In some cases, people have failed to completely and thoroughly analyze the benefits/liabilities before investing in something that can very possibly yield significant profit dollars. One of these options, Top Tracer, is quite possibly a questionable investment. I happen to have a golf driving range with a brand new Top Tracer facility on their property located less than 1 mile from my house. In the next 48-72 hours, I am going to pay them a visit and I will inform you of the details of my visit. (I believe that they are closed tomorrow, Sunday, January 23rd.
From the outside, let’s take a look at Top Tracer. Several years ago, the golf tournaments on television started to show the path of a touring golf professional’s tee shot. A new revenue stream came into existence. Studies were apparently done as to how many people watching these golf events felt that this feature enhanced their tournament-watching experience. Evidently, the increased TV ratings for these events translated into higher profit dollars for the TV stations, as higher ratings allowed for higher TV commercial revenues.
IF, Top Tracer is to follow prior attempts to throw money at some untested option in an attempt to generate new and substantial revenues for their purchasers, no one can say for sure what the results will be. There are several possibilities here. Will people enjoy the computer screens with the results along with the snack bar and bathroom facilities and be able to afford this type of entertainment? Will these facilities be able to be used frequently year-round to be profitable during ever month of the year. Will the hot Florida weather drive enough golfers into the Top Trace facility to practice indoors in the the air-conditioned practice areas. What is the cost of the air-conditioning? Is there a stark realization that the facility has to be staffed even if there are no patrons? Just as when a new restaurant opens in your neighborhood, you will likely try that new restaurant at least once, thus drawing revenue away from your restaurant for at best, a short time.
I briefly read the material that I was sent to me. The one thing that stood out the most was the fact that, after all of the original cash outlay of over $1,000,000, the first-year profit is only $81.00! WOW!!! What happens if the expensive investment fails after 1 year? Another item that stood out was the fact that the snack bar option is not easily accessible to the patrons. In addition, having to walk about 200 yards to a bathroom is unthinkable. Next, there is absolutely no option of opening until everything is 100% ready, there will be a problem. Remember that old expression, “You never get a second chance to make a first impression”.
Rest assured!! There are at least 3 options that are a part of my business plan for Fernandina Beach Municipal Golf Course. All 3, when used in any sequence, will significantly increase your revenue. These 3 options will require only 1 item before you can proceed.
In my next article, my 6th installment, there are a few additional comments about indoor/outdoor golf facilities. Then, what follows will be Part 1 of my suggestions. I’ve entitled it, “The Re-Development of Golf at the Fernandina Beach Golf Course-Part 1”.
As always, I am, for you, Alan Prescott. Please contact me at [email protected]. Be safe and stay healthy.
A bit confused over some of the statements with regards to Toptracer operation. The Toptracer range at the FB golf course is an outdoor, covered but not enclosed design, so the hot summers and colder temperatures will be an issue. Agree that the food/beverage issue is going to be a major concern as it could represent as much as 50% of overall range revenue. Having a beverage cart with attendant by the facility can support beverage, snacks and cold food (sandwiches) service, but hot food will have to come from the kitchen inside the clubhouse. While TopGolf is more of an entertainment venue especially during the evening hours, I look at Toptracer as more for the golfer to improve their game although there are options for course play and games to promote the entertainment feature.
Not sure about the $1 million cash outlay cited in the article. I thought the construction costs for the range itself was $400,000 and the technology is leased. Then there is the personnel and ongoing maintenance expenses so maybe that is capital outlay and operating expense. Some clarification would be helpful.
I have worked at PGA tournaments as one of the Shotlink laser operators where the shot statistics are used by the TV commentators as well as the players after the match to provide better information to them on the distance and accuracy of their shots. From a TV tournament watcher perspective, I enjoy seeing a tracing of the trajectory of the ball and how a golfer will shape a shot to fit their approach on a hole. I can’t say that the feature attracts additional fans, but I am a sample of one.
Looking forward to the articles specific to the course and the suggestions to right the ship.
The Top Tracer here is destined to fail after a year. No water, sewer or facilities like bathrooms or a kitchen?
Big dollars to install now and will add as much as this white elephant cost to build.
which by the way was over 500,000 if you include the grading and materials spent on “improving” the driving range ….which still floods.
Great example of short sightedness by the City and staff.
Just wait until they work their magic on downtown.
I understand the facility was originally designed with plumbing and a snack bar. Enclosing it would be ideal, but probably price-prohibitive. The plumbing and snack bar were deleted to save costs. What an idiotic idea. Of course there will be a men’s room outside near a corner of the building. If there is no beverage cart, there will be a loaded bar in someone’s trunk near the range. What a short-sighted design.
Bruce, need to get you back on the Golf Course Advisory Board recognizing that no good deed does unpunished. Know they are only advisory but what was their position in all of this. Where and how was the decision made to delete the water and food service features from the design?
Think the Mayor’s critical comments about the marketing of the program are a bit off in places. When you don’t have a solid opening date, you don’t launch a major marketing program especially during the “off season”. Like any other business, you have a soft opening to make sure everything is working properly and in place and then you promote it. Agree that the branding needs to include the name and a better description of the program to appeal to a wider audience.
I spent 5 or 6 frustrating years on two Advisory Boards. One was abolished by the Commission without any notice or rationalization given. It turns out one of the Commissioners wanted to stuff a new Board with his cronies, but he couldn’t get any to do it.
We were supposed to have a commissioner to act as a liaison. In all those years, I believe we had a total of 3 show up. The Commission made a few golf-related decisions and NEVER asked for our input. Would you want to waste your time doing that?
Bruce, I know the history hence my opening statement about no good deed going unpunished.