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Are we there yet?

By |  December 14, 2017 0 Comments

As we near the close of another calendar year, we always find ourselves reflecting on our personal lives as well as our professional lives. In my case, I also look hard at golf, the industry from which we make a living.

It gets harder every year for the golf industry, and I suspect it will continue to be a challenge to keep the industry strong. Our respective professional associations spend a large percentage of their resources, money and staff time to figure out how to keep the industry sustainable and to represent us in front of the public, golfers, regulatory agencies and lawmakers.

It’s been almost 10 years since the golf industry last had to push the reset button. Since the economic downturn at the end of 2008, several hundred golf courses have closed, compared with only a couple handfuls of new course openings.

Our industry has seen many changes in the past several years, and frankly, some of them were necessary to keep the industry strong. During the heyday of golf course construction, too many courses were built around the country in too many markets. I hear every day about golf courses that struggle to be sustainable. Golf courses in all sectors of the industry have closed, including municipal, daily fee, resort, semi-private and private.

I’m currently working with a client that is considering closing one or more of its existing golf courses. This client is analyzing financial ramifications, political realities, whether closing a course or two can benefit their other courses by redistributing rounds and revenues more efficiently, and if it can help make the remaining courses stronger and more sustainable in the long term. In the case of this client, there are more than 40 golf courses in a relatively small market.

My question: Our industry has seen a relatively large net decrease in the number of golf courses compared with just a few years ago, but where does this trend end? With less available land, more stringent regulatory mandates, more environmental issues, the cost and availability of water in some markets and the ever-increasing challenge of finding and maintaining staff, what is the sweet spot for the number of golf courses in a particular market? I know this question is impossible to answer, but if we are honest with ourselves we must admit that more golf courses are closing in the United States — in all markets — than there are new courses opening.

To be clear, I’m not wishing for more golf courses to close their doors. But I’m a realist.

I know that many golf courses around the country are financially strong, viable operations and will continue to operate for years. But I also know there is still a large number of courses that continue to struggle.

I know this because I constantly get calls from owners of all types of golf courses who need help to operate their venues more efficiently and improve course conditioning to improve their financial situation and keep competitive in their markets. And these calls are not isolated to a specific location in the country. They are everywhere. Many owners even are considering repurposing their properties to get more return on their investment.

Because of the economy, the reset button probably needed to be pushed. In fact, let me alter that a bit. It definitely needed to be pushed. I’m concerned that there still is a significant number of golf courses that are a season or two away from closing. I’m not sure if this a good thing or a bad thing for our industry.

So, the question remains: Are we there — at that sweet spot — yet?

Sadly, I don’t think so.

This is posted in Columns


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