[John Kavanaugh]

Using a basis of 10,000 rounds per year with overnight stay income that offsets the loss on food service. 

[Mike Nuzzo]

I don't know about should, but it could be...

maintenance expense
golf capital budget
facility capital
lodging and club expenses
service salaries
a little profit

$150

[John Kavanaugh]

I don't know about should, but it could be...

maintenance expense
golf capital budget
facility capital
lodging and club expenses
service salaries
a little profit

$150

Mike,

Why can't it be done for less than "One Million Dollars"?  I chose Ballyneal, not only because it is topical, but because it is the model of simple excellence. 

[John Mayhugh]

It would be really helpful if you could provide the per round cost at Dismal River.  Nice to have more than one data point.


Not sure what the proper emoticon is for sarcasm.  The topic of destination course operational costs may be interesting discussion, but targeting a specific private club as an example does not seem appropriate.

[John Kavanaugh]

It would be really helpful if you could provide the per round cost at Dismal River.  Nice to have more than one data point.


Not sure what the proper emoticon is for sarcasm.  The topic of destination course operational costs may be interesting discussion, but targeting a specific private club as an example does not seem appropriate.

I would guess the cost per round at Dismal to be around $500.

[John_Cullum]

Why does food and beverage have to be a loser? Plenty of people make a living in the f&b business. The best idea I ever saw was a club that leased its restaurant space to a local restauranteur. The club had a guaranteed income, and none of the hassels of running the joint. The food was great and reasonably priced. I would suppose the restauranteur made money, they operated there for years.

[Tim Nugent]

The amount that maintains that 10,000 rounds, if that is their goal.  
When Kemper Lakes 1st opened, they were formualting the greens fee.  They figured x number of rounds at $20 would achieve their goals.  My father thought that would be too much wear and tear on the new course and suggested the steep price of $25/round.  His logic was they wouldn't lose 20% of X players and they could spread out the tee times from 8 to 10 minutes. It worked and they actually made more money that 1st year AND had a bigger reserve for maintenance/repairs.

John, I think it is hard to come up with a number if you don't know more aspects of current expenses and the owners goals.

[Joel_Stewart]

Why do you assume there is no debt?   They bought the note from the bank (eliminating bank debt) but there still is the debt.

I'm told there is a meeting with the 100+ members this month to outline how the club will move forward.  I'm anxious to hear the strategy.

[Chris Johnston]

John

I believe 10,000 rounds is way too high for B'neal.  Not enough beds/too short a season.  Guessing its high by a factor of 2x-2.5x.  Dismal has 2x the beds as B'neal.

Both F&B and lodging are a profit centers.  F&B mrginally so, primarily due to the captive audience and higher costs of supply due to remoteness.

Your cost per round is near the ball park, probably within $100 either way depending how dues are factored.  Since we charge for all day play, we don't pay as much attention to rounds.  54 holes is the same for us as 18.  Better measure for us (and probably Bandon) is lodging nights.  Butts in beds is the key.

I don't mind sharing this - it is what it is.  Be careful of the sacred cows.

[John Kavanaugh]

Why do you assume there is no debt?   They bought the note from the bank (eliminating bank debt) but there still is the debt.

I'm told there is a meeting with the 100+ members this month to outline how the club will move forward.  I'm anxious to hear the strategy.

Is Ballyneal out of foreclosure?  That would be great news.

[Carl Rogers]

How much would a Limited Partnership set you back in this new venture?

[Mike_Young]

Don't forget to allow for absorption of rater comps

[Jud_T]

If you play as many rounds as Colton, about $0.50/hole...

[Mike Nuzzo]

Mike,

Why can't it be done for less than "One Million Dollars"?  I chose Ballyneal, not only because it is topical, but because it is the model of simple excellence.  

I bet Don could run the whole place for $500k or similar
How many square feet of buildings - not golf maintenance
I don't know how much it costs to maintain the other stuff

[John Mayhugh]

I don't mind sharing this - it is what it is.  Be careful of the sacred cows.

What does your last comment mean? 

[Kalen Braley]

Perhaps he meant this?

[Chris Johnston]

Mike,

Why can't it be done for less than "One Million Dollars"?  I chose Ballyneal, not only because it is topical, but because it is the model of simple excellence.  

I bet Don could run the whole place for $500k or similar
How many square feet of buildings - not golf maintenance
I don't know how much it costs to maintain the other stuff

Mike - Fully agree Don is both terrific and efficient.   With both resortlike lodging and F&B, the base costs are much higher.

I would guess the debt alone (interest or amortized) could cost somewhere between $50-$100 per round played.  In this environment, debt.

Kalen - I love that photo!

[John Kavanaugh]

I was curious what it would cost to maintain a perfect walking only course in a remote location.  I can't imagine that I'm the only one who thought about buying Ballyneal for the right price and owning one of the great golf courses in the world.  Lucky for me, I quickly threw up in my mouth, and came to my senses.  I just know that it can't be done for as little as I hoped, I was looking for some reasons why.

I think the reality of the situation is that 99% of us are having our golf subsidized by others and don't even realize it.

[jeffwarne]

Mike,

Why can't it be done for less than "One Million Dollars"?  I chose Ballyneal, not only because it is topical, but because it is the model of simple excellence.  

I bet Don could run the whole place for $500k or similar
How many square feet of buildings - not golf maintenance
I don't know how much it costs to maintain the other stuff

Mike - Fully agree Don is both terrific and efficient.   With both resortlike lodging and F&B, the base costs are much higher.

I would guess the debt alone (interest or amortized) could cost somewhere between $50-$100 per round played.  In this environment, debt.

Kalen - I love that photo!

Chris,

I'm a bit puzzled.
In an earlier post, you stated both lodging and Food and beverage were profit centers. (which I find shocking, but I digress)

If they're profit centers, how do they contribute to higher "base costs" (by which I assume you mean higher operating costs) on a net basis.
Did you mean they were "revenue centers"?

I also realise that you can't seperate the two as one cannot exist without the other in a remote location.

Thanks,
Jeff

[Chris Johnston]

Jeff - You are correct.  They are indeed profit centers.  Both also consume alot of seasonal capital as bioth have their own fixed costs, including staffing and energy.  Kind of like buying for the pro shop.  Money upfront to reap later.  I was referring to only the cost side needed to produce the revenue.

Hope it helps.

[jeffwarne]

Jeff - You are correct.  They are indeed profit centers.  Both also consume alot of seasonal capital as bioth have their own fixed costs, including staffing and energy.  Kind of like buying for the pro shop.  Money upfront to reap later.  I was referring to only the cost side needed to produce the revenue.

Hope it helps.

Well I don't think I can be right because i doubted they were profit centers

but, if I'm understanding you right, and F &B and lodging are profit centers, (let's say small) then the only expense left is the golf operation and golf course(and grounds) maintenance.---no?

[Chris Johnston]

Nope.  We don't allocate overhead (taxes, Insurance, energy, etc) over F&B and lodging so there is more than just the course left.

[jeffwarne]

Nope.  We don't allocate overhead (taxes, Insurance, energy, etc) over F&B and lodging so there is more than just the course left.

That being the case, I'm going to go with my original thesis.
F&B and lodging are revenue centers, not profit centers

[Chris Johnston]

Thesis away, my friend.  Thesis away.

[John Kavanaugh]

Nope.  We don't allocate overhead (taxes, Insurance, energy, etc) over F&B and lodging so there is more than just the course left.

That being the case, I'm going to go with my original thesis.
F&B and lodging are revenue centers, not profit centers

Jeff,

Go with me sometime to Dismal and I can show you how Food and Beverage becomes a profit center. Now I consider this a good thing, but somebody ain't gonna make it home one of these days.  I thought we lost my Amish buddy earlier this year.

note:  When you are over 50 and on a buddy trip if there isn't a shot a dying you may as well stay home.

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