A belated Happy Father’s Day to all the Dad’s – I always enjoy celebrating while watching the final round of the US Open. Below are several focal points you may find helpful. If anything resonates, and you would like to discuss further, do not hesitate to contact myself or our team.
Without a plan…
As Benjamin Franklin said, “By failing to prepare, you are preparing to fail.” While applicable to many areas of life, this quote is especially true of businesses. It is surprising how often golf course owners contact us for potential solutions, but have not created a plan for revenue growth, operational strategies, or community engagement. As a golf course operator, now would be a great time to bolster your plan with tactics and strategies for the remainder of the season. Analyze historical performance to identify opportunities for increased utilization and refine programs that increase engagement. Lastly, the cost of finding a new golfer/member is exponentially higher than the cost of marketing to an existing patron of your facility; hence, data is king. Channeling my inner Ben Franklin – without a plan there is no attack, without an attack there is no victory, with no path to victory, why bother?
Exciting Industry Initiatives
The National Golf Foundation (“NGF”) has surveyed Americans regarding golf participation every year since 1986. Respondents are segmented in numerous ways, but an oft discussed category is “Latent Demand.” NGF defines latent demand as, “Individuals ages 6 and above who did not play golf during the survey year but who indicated they’re very interested in playing golf now.” A more succinct description – very interested non-golfers.
Identifying opportunity is valuable, acting upon opportunity is transformational. After creating a roadmap to better embrace and engage the nearly 15 million Americans within the latent demand segment, the NGF partnered with state and regional golf associations in Colorado to beta-test a new initiative. The Welcome2Golf.com website is under construction, courses are enlisting to welcome new players, and professionals are preparing with tools to ensure a fun, friendly introduction. A Boulder-based ad agency will execute the campaign aimed at three non-golfer targets – 19th holers, competitive athletes, and families. I’m thrilled to see the NGF use its resources to help activate this non-golfer segment for the industry.
Cost of Capital
Last month we highlighted both the low cost of capital and our reinvestment in properties with a keen focus on ROI. Similarly, we are experiencing a significant uptick in golf community residents trying to determine the best way to protect their property values and control their backyard – a la purchasing of the golf course. We have seen communities acquire golf courses through a variety of mechanisms. Many communities have an established Homeowners’ Association or Property Owners’ Association with the legal capacity to assess residents, and lenders have been receptive to working with these groups. Other communities have voted to form special taxing districts (Community Development Districts, Neighborhood Improvement and Beautification Districts, etc) to acquire courses through the issuance of bonds. Each situation is unique, but most communities recognize that the cost of capital is very inexpensive and a nominal assessment to homeowners pales in comparison to a 5% decrease (at a minimum) of home values. I am happy to share some of the innovative structures that we have worked out with community golf course owners to protect their “backyards” and a prime asset.
Hiring like a Sports Franchise
When speaking with a fellow team member about hiring key personnel, I was struck by the number of similarities with successful sports franchises. The successful sports franchises are not always drafting the best available prospect or strictly filling a positional need, they draft the best available player based on their own parameters and the intangibles. Key hiring takeaways from the draft strategies of dynastic sports franchises:
· Does the individual fit our culture?
· What are the absolute must haves vs. what is easily teachable/trainable?
· Are we hiring in an area of weaknesses so that each team member can excel by focusing on their strengths?
Seems simple, I know, but I am frequently amazed when successful Board Members, Owners, and Managers believe a simple job description will identify the needed candidate for a job.
Happenings within the Herd
It’s always exciting to see the enthusiasm and registrations for the World’s Largest Golf Outing™ (WLGO), the single largest charitable golf event held on August 5th. WLGO makes a significant impact in the lives of those who need it most: our nation's veterans. This year, WLGO will benefit the Fisher House Foundation, which is best known for a network of comfort homes where military and veterans’ families can stay at no cost while a loved one is receiving treatment. BCG has set another ambitious goal raising hundreds of thousands of dollars for this great cause, and I encourage any and all to participate in the tournament at facility near you. We thank you in advance for your consideration and support of our nation’s veterans.
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