Page 11 - GBC Fall 2022 Eng

Inflation is a four-letter word. It masquerades as an even set of four vowels and four consonants; deceives us with an alternative vernacular of derivatives and context to deflect its overall impact and it even seeks to portray itself as being good for the economy in small doses.
But, as inflation continues to climb to unprecedented levels in more tidal wave than trickle down, it’s become a straight-up four-letter expletive with the potential to undo, to varying degrees, a renaissance the Canadian golf industry has experienced after two full seasons of heightened participation due to COVID-19.
Private, semi-private, public and municipal facilities spent 2020 and 2021 virtually tapped out of tee time inventory. New and returning consumers helped to spike golf to levels not seen since Tiger Woods halcyon days of the late 90’s and early 2000’s with women and junior golfers making up the largest percentage of the new faces. Waiting lists re-emerged at clubs for membership and discounting (another dirty word) got shoved in a drawer and forgotten. Record participation was the net result.
In December, the NGCOA Canada reported a nine percent increase following a record- breaking 2020 season and 24.1% higher than the five-year average. Compared with pre-pandemic
data, rounds played coast-to-coast closed a whopping 30% higher over 2019 and year-to-date revenues saw an increase of 20% over 2020.
This season is not expected to get to those same upper echelon levels although some regions of the nation are trending along a similar path on the tee sheet.
But, as resilient as golf course owners/operators had been in pivoting to meet and, in many cases, exceed government imposed guidelines for safety protocols during the pandemic the elephant in the room was obvious: A financial reckoning was waiting in prospect. Not just for golf, but for the entire country.
DISCRETIONARY INCOME COMPROMISED
Economists warned of higher prices for fuel, commodities, labour, shipping and raw materials to go along with surging house prices in several regions of Canada. Supply chain issues continued, lumber and other essential building materials saw huge price jumps and the labour market became a nightmare with a people shortage in virtually every primary and secondary sector of the economy.
Canada’s inflation barometer opened this year in the 6.5 – 6.8 percent range, the highest rate Canadians had seen in 31 years. At the time of writing, mid-year
inflation had already surged to a record 8.1 percent amid warnings of numbers that could climb higher by the time you read this. For many, the inflationary landscape has turned into a source of clear frustration.
“You couldn’t print what I think,” stated one western Canada general manager, who oversees a 36-hole operation in Alberta and didn’t wish to be named. “It’s xxxxxx. You can’t plan a xxxxxxx budget and you can’t forecast into the front end of 2023 because honestly which shoe drops next? How high does oil get to? Is there a ceiling? What about commodities? Out here, I’ll tell you the price of groceries is crazy. It’s xxxxxx.”
The Bank of Canada clearly whiffed. Badly misjudging where the ceiling was going to get to on prices it countered with its standard rise in interest rates, a strategy welcomed by investors, but one that compromises discretionary income for a majority of Canadians. That hits at the heart of golf on multiple levels.
“Consumers are stretched, oper- ators are stretched. There’s barely a xxxxxxx middle ground anymore,” the Alberta G.M. continued. “You can only stretch a budget so far, right? And supply chain? Yeah, I’m still waiting on replacement power carts we ordered this time last year. It’scrazy.”
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