Page 34 - GBC spring 2016

In addition, this detailed plot- ting of rounds by member, tourna- ment, third party discounters, and general public will allow the opera- tor to evaluate the potential for 2016 through opportunities to change the mix in rounds and develop marketing initiatives to sell the ‘worst’ rounds.
The overall strategy is to develop a plan which increases the utilization of all available tee times at the highest price. Using this analysis of rounds, the operator can also plot out the expected revenue by day, by month for driving range sales, food and beverage sales, and merchandise sales.
From an expense analysis perspective, a ‘zero-based’ budget should be completed, whereby all expenses are supported by historical information or payroll based upon the number of employees required and hourly rate.
A Market Study is the next step. This is essential to developing the marketing plan and business plan. Most operators do not complete this analysis in detail. An appropriate study is to complete a demographic (compensation) and psychographic (likely to play golf) analysis within every 5-minute radius around your facility up to 45-minutes.
Once this analysis is complete, use whatever patron information is available in order to plot each of their locations. This research information will give you the needed background to develop a more ‘rifle shot’ approach to marketing.
Furthermore, this research should identify opportunities for market/ promotion support. For example, hotels, churches, jewelry stores (they know who’s getting married first), etc.
This information, along with competitive pricing from other golf courses in the area, will allow management to appropriately price its product and develop a focused marketing plan.
SEGMENT FOR SUCCESS
Once you have completed this outlined process, the operation will have a detailed roadmap for 2016. In addition, it allows the management team to develop a marketing plan which addresses selling the ‘worst’ tee times and utilization of facilities.
The most successful operators segment their operations and put an individual in charge of performance for each segment. Typical segments are as follows:
1. Dynamic pricing and yield management.
2. Cart utilization.
3. Driving range as a separate business unit – performance
is based upon the metrics of
a stand-alone driving range, especially if the driving range is six to eight (plus) acres.
4. Merchandise sales. (Retail operation and inventory control).
5. Food and beverage operation – daily patron sales, tournaments and banquets.
Each manager should be incen- tivized for superior performance – not only on their business unit; however, on the total operating per- formance. It will be essential that any bonus system put in place for managers ensures a focus on over- all club performance (profit).
Once the management team is in place and the business plan is complete, the owner/operator must consider whether his or her team has the appropriate tools to
meet their objectives efficiently and in a timely manner. In addition, the owner/operator must be the leader and key strategist who considers trends and issues in the industry as they arise, in order to ensure management is aware of these developments. The best tools are efficient information systems, appropriate user training and data source sites.
A common phrase used in the golf industry is “In the Land of the Blind the One-Eyed Man is King.” Knowledge and planning are key to success.
ASSET MANAGEMENT AND EXIT STRATEGY
The next most important item to discuss is whether to ‘Hold’em’ or ‘Fold’em.’ Asset management and an exit strategy must always be part of the owner’s vision. The exit strategy comes first. Every owner needs to know the potential value for his or her property.
In order to determine the highest and best use for the property one must understand the opportunity to repurpose the property and the impact to value. As a result, the owner needs to gain insight from a planner as to the potential to develop the property.
The planner will be able to give advice on the potential to develop and the time required to rezone, if possible. This information along with your evaluation of financial performance will help to develop the timing of any disposition. The key will be the wishes of the owner and his or her estate plan.
This method of evaluating the opportunity will allow the owner to determine the best course of action in order to determine when is the best time to sell, if that is the ultimate strategy. The best owners and operators evaluate their options each year.
Golf Business Canada
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Golf Business Canada