2011 Golf Club Business Plan

From time to time I am asked to review a business’ operations to find weaknesses and issues affecting their business plan.  Since my interest professionally has been in the promotion of the golf industry I have provided a review of how golf clubs, private or public, need to look to developing their business plans for 2011.

Change Remains in the Air

In 2011, Golf clubs, both public and private, will be challenged in a number of ways.  The biggest issue golf clubs will have to deal with will be to improve upon what they did in 2010.  Since golf clubs find themselves saddled as part of the struggling leisure and recreation industry these icons of the golf industry will find 2011 to be difficult unless they develop a better business plan.

Success in 2011 will hinge on golf clubs maintaining a higher level of customer service to its golfing membership.  Any growth expectations will depend on making sure the golf course meets the golfers needs while making sure the clubhouse fits the times. Customer retention will be critical to a golf club’s bottom line. If the golfers are satisfied with their experience at the golf facility, they will keep coming back and they will bring their friends. Golf clubs should want their members to play more often and spend more money each time they visit. To accomplish this successfully in 2011 golf club’s will need to get creative and maybe even reduce pricing to establish a wider base of interest in their market. This will mean further changes will have to be made to their revenue streams which include green fees or membership dues, golf cart rentals, fees for golf instruction, equipment and clothing sales, and food and beverage sales.

Following are the steps a golf club should take to improve their business plan in 2011.

• Step 1

  Review past performances. Analyze the previous year’s financial results, operations effectiveness and personnel attributes.  Determine which revenue streams met or exceeded the forecast and which fell short of the plan.   Exam where operations improved and where it needs improvement.  Review how the club’s personnel improved club members’ morale and where they need to step up their influence.  Search for root causes not reasons for a problem. Take a critical look at the overall quality offered the membership. Most clubs will find the golf course and clubhouse itself needs updating, upgrading or complete replacement to compete with newer facilities.  Once the details of all the challenges the golf club is facing are laid on the table the plan to overcome them all can be made.

• Step 2

  Evaluate the competition. Through out the year have staff members from each department visit major competitors’ facilities to compare their services offering, including the quality of the facilities, customer service and the prices charged. Determine what competitors are doing well and where there maybe a definite competitive advantage.

• Step 3

  Analyze golf industry trends, and trends in the local economy. Obtain data from verifiable sources, in and out of the golf industry, on current trends in the golf economy. Review forecasts on whether the number of golfers in the area are likely to increase. Look at the economic conditions in the local area surround the club and how that will affect the growth of the club’s membership.

• Step 4

  Set departmental goals to match those of the club’s overall approach to improving. Establish plans that work toward increasing the golf course’s occupancy during weekdays when play is normally light. Set reasonable obtainable goals for increasing clothing sales in the pro shop.  Support all departments initiatives with relevant marketing.

• Step 5

  Tie all goals to strategies that match the club’s operations capabilities. A golf club is a natural for business golfers.  All goals should be focused on getting business people out on the course during the day, after work and for special business golf events. Tie all activities to press coverage about the course’s beauty, challenge and advantages the club presents to business golfers’ operations.

• Step 6

  Take a more operational approach to forecasting how the profit and loss statement will be forecasted. Take the revenue goals and convert them into a forecast for each business segment of the club. Forecast the expenses necessary to attain these goals. Add the departmental plans together into a consolidated business plan.  Place user friendly measurements in place and monitor them daily.

• Step 7

  Continually Review and modify the business plan. Check the plan for reasonableness and make adjustments as needed.  In this frail economy a golf club should not sit tight on making immediate changes to a business plan.  Scale back revenue assumptions that are too aggressive. Make sure the marketing budget is sufficient to generate the increases in members forecasted.

• Step 8

  Marketing Plan has to be based on the Club’s operations capabilities and not on false hope revenue goals. Once the above steps have been taken, the golf club needs to look to balance its marketing plan with what the operations can deliver.  There needs to be an exceptionally user friendly Online presence established for the golf club.  No marketing can be done in today’s business environment without some level of presence on the internet.  Where the golf club appears in a search engine search will matter in 2001 and will confirm the commitment the club has to its members to be the best golf club in the community.  The marketing of what the club offers should take on a more personable approach.  Strategies could include the club’s staff and management taking to the streets of the neighborhood around the club to gain knowledge of how the club looks to the people who see it everyday.  The strength of a golf club is based on the club appearing successful.  If the golf club looks old an attitude will quickly develop amongst its membership that it does not care how it looks to the people who live in the community.  For older golf clubs marketing a new image will play a huge part in the success the golf club is planning for 2011.

Executive Summary:

The survival of golf clubs comes down to their ownership and management thinking different and doing everything different.  Golf clubs have to rely on their operations and not their marketing to get them through the upcoming tough times in the golf economy.  A golf club’s image as an icon in the community should be established and any look, feel or stigma related to the club’s corporate ownership or golf management group should be squelched.  A club should appear to its members as an extension of their home and not just being an aging facility with a corporate scheme to appear as a resort.  Golf clubs who adapt to developing new attitudes, new clubhouses, new updates to old courses will be the clubs that will attract the new members needed to float the club’s operations.  Golf Club members should be made to feel they are number one to the golf club’s mission and in 2001 all efforts should be made to reach out to each member to learn more about their needs and wants.  The quality of a facility will be paramount to a golf club’s survival.  Quality service will retain membership which will sustain revenue streams enough to get the golf club through to the time when golf is again enjoyed as a great leisure and recreational activity.