Marty Carr - CEO Carr Golf Services

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The Road to Recovery

Operating 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 industry

• 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

• 3 rd 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

Key Considerations

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

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