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  • Writer's pictureRichard Mandell

Ensure Golf Is Not a Secondary Proposition

In my previous blog, I declared that I did not think the golf industry deserved an economic bailout from our new government. Instead, I related that our industry should learn from past mistakes, accept more reasonable business plans, and look to create facilities for the right reasons. One of those past mistakes was the attitude that golf was not the primary focus in most new development projects. I feel a golf project should be built as the lead for any development it may be associated with. In other words, a golf course project has a better chance of success if it is not a secondary proposition.

Many will decry that golf is strictly an amenity that helps get other projects off the ground, the most common type being residential developments or hotel/conference centers. Many people do not realize that golf courses become part and parcel to these projects strictly to sell homes, hotel rooms, or conference space, without golf rounds being the primary objective. Many others will say that without these leading economic generators, golf would be irrelevant.

Those statements are all partially true and that is yet another reason why the golf industry suffers today: Golf is too built-up in places and too expensive to boot. People who see golf as simply a means to their own project’s end see the need to outshine the competition in aspects of golf course development that have no bearing on the game itself. Bells and whistles like stone retaining walls, fountains, every means possible to create a “signature hole”, and the need for a marquee name as the designer all come before the need to create sustainable, playable, affordable, strategically-stimulating (for all) golf courses.

For decades I have seen numerous decisions being made in the early stages of a golf course project for so many reasons far beyond the game itself. Huge clubhouses have been built (or renovated) at the expense of the golf course for such minor purposes as “the ability to provide wedding reception space” or because “we need a separate family dining area in addition to the men’s grill and main dining room.” Golf course renovation projects have been thrown on the back burner to put these needs in front, even as the greens slowly die away.

These other concerns rarely translate into revenue. A golf course is where people come to play golf, a restaurant is where people go to eat – simple concept. Does one think that the Morton’s Steakhouse people consider a golf course as an amenity in case someone may want to play a few holes between the French onion soup and the ribeye? No, so why should the opposite be true?

Primary decisions to attract a certain member-type have too often trumped the desire to create an interesting golf course. Marketing firms insist they can market a big-name designer easier than the fine attributes of the golf course itself. Routing decisions have been made because someone insisted that it wasn’t good business not to have returning nines. The primary driver in that decision too often comes from food and beverage departments or the pro shop looking for increased merchandise revenue. The need to start golfers on one and ten is another reason for this decision. But in all the above cases the possible consequences of forcing returning nines can be so financially crippling that an increase in F & B revenue, golf ball sales, and extra rounds become moot). The cost of increased construction and the resulting difficulty of the layout to achieve returning nines may never allow a golf course to achieve the lofty numbers someone’s feasibility study suggested. The golf course will end up being too difficult or slow to play.

Does that mean I don’t think one should ever build a golf course as part of a residential development or a hotel/conference center? My critics will claim that there are viable end-users who seek out golf as part of a conference experience and that many want to live on a golf course. All that is true, but there aren’t enough of those end-users to pull up the slack to make those golf courses a viable business. In too many cases, they become loss leaders. In order to combat that, costs are through the roof which leads to less repeat play - and the cycle of failure is set in motion. This is then repeated down the road in many towns. There simply is too much of the same golf too close to each other. My home in the sandhills of North Carolina – home of 43 golf courses – needs a purge of at least five to eight golf courses right off the bat.

The simple (or not so simple) solution is for residential developers and hotel/conference center operators to determine if golf is a viable profit center without the economic drivers of their primary business. If so, then the golf course is certainly placed in a strong enough market that it can stand on its own, costs can be minimized, and repeat play can be realized. If not, then a different amenity should be considered.

If golf is blindly placed in the wrong market, not only will that facility fail, it will slowly drag down existing facilities by slowly funneling rounds away. The result is multiple struggles and a black eye for golf. The ultimate loser is the golfer. As long as golf is the primary proposition, then it will rarely fail in any setting – stand alone, as part of a community, or as a hotel draw. Let others disagree, but if they are correct the golf business would be a bit healthier today, don’t you think?

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