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Mike Sweeney

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Re: Private Clubs at a Crossroads
« Reply #75 on: June 11, 2019, 05:15:47 PM »
bernie i think the 1 thing that ties all 3 of those things together is value or efficiency. to not pay for things that aren't utilized.


BRoss,


I agree with this post, but real world examples are preferred if you are going to advance a discussion. I have talked about the Disney Vacation Club model in the past on this thread -


http://www.golfclubatlas.com/forum/index.php/topic,64404.msg1535176.html#msg1535176


Brilliant! This is very similar to the Disney Vacation Point System that we used for 15 or so years and just sold. The key difference was - we had shared ownership of the real estate. We made money on the points when we sold, but Disney obviously made money off the fees and then our visits to the parks and restaurants but hey, we drank the juice when the kids were younger. https://disneyvacationclub.disney.go.com/points/

Here is the original model from that thread - https://www.playmore.golf/find-out-more

Golf is painfully slow to change for a variety of reasons including the love of the game. Why change what is loved by those that spend the $$. If we lose 1500 courses in the USA, did we really lose anything? In the worst year of 2012, we lost 154 courses.
https://www.pga.com/golf-courses/golf-buzz/more-courses-will-close-open-over-next-few-years


Golf is a lousy investment, but that does not mean it is going away.
« Last Edit: June 11, 2019, 05:18:18 PM by Mike Sweeney »
"One of the saddest lessons of history is this: If weíve been bamboozled long enough, we tend to reject any evidence of the bamboozle. Weíre no longer interested in finding out the truth. The bamboozle has captured us."

Dr. Carl Sagan, The Demon-Haunted World: Science as a Candle in the Dark

John Kavanaugh

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Re: Private Clubs at a Crossroads
« Reply #76 on: June 11, 2019, 05:58:40 PM »
bernie i think the 1 thing that ties all 3 of those things together is value or efficiency. to not pay for things that aren't utilized.


BRoss,


One thing you need to accept when you join a private institution is that you don't get only exactly what you want. In order to attract more members than just you other other amenities must exist. Even in that I do think that most places distinguish between family and individual memberships. I am not a member of any club that forces me to rent a locker, to take caddies or rent carts. What do you possibly want? A fee structure where you pay just for golf on the days you choose to play golf? I do believe that is available at 100% of the public fee courses across the country. Please, how can a private club serve your needs?


You want to continue the discussion. Continue it and tell us exactly what you want at what cost.

David Restrepo

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Re: Private Clubs at a Crossroads
« Reply #77 on: June 11, 2019, 06:42:34 PM »
BRoss - you spoke of reciprocity, so I wanted to add to my case for the "Australian model". Most courses in Oz, even 2nd and 3rd tier clubs, have an expansive reciprocal network across the country and in some cases, internationally (though USA is strongly lacking for even top tier courses).


Any time I travel out of Victoria, I will set up a round with one of my reciprocal clubs. Free to play and a wonderful experience.

John Kavanaugh

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Re: Private Clubs at a Crossroads
« Reply #78 on: June 11, 2019, 06:49:47 PM »
BRoss - you spoke of reciprocity, so I wanted to add to my case for the "Australian model". Most courses in Oz, even 2nd and 3rd tier clubs, have an expansive reciprocal network across the country and in some cases, internationally (though USA is strongly lacking for even top tier courses).


Any time I travel out of Victoria, I will set up a round with one of my reciprocal clubs. Free to play and a wonderful experience.


Don't you guys down under let bus loads of numb nuts play willy nilly.

David Restrepo

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Re: Private Clubs at a Crossroads
« Reply #79 on: June 11, 2019, 07:00:20 PM »
For a fee to add to the club's coffers  ;)

John Kavanaugh

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Re: Private Clubs at a Crossroads
« Reply #80 on: June 11, 2019, 07:03:27 PM »
To name a course where I am not a member. Can't you join Moraine which is a great course as a national member and have the pro get you all the reciprocity that you can eat? I just get the feeling that people aren't really serious about this subject.

David Restrepo

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Re: Private Clubs at a Crossroads
« Reply #81 on: June 11, 2019, 07:10:31 PM »
To name a course where I am not a member. Can't you join Moraine which is a great course as a national member and have the pro get you all the reciprocity that you can eat? I just get the feeling that people aren't really serious about this subject.


I assume one would pay the expensive guest fees if you use the pro? Having a more structured reciprocity is great from a logistics perspective, like ease of booking and cost.

B.Ross

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Re: Private Clubs at a Crossroads
« Reply #82 on: June 11, 2019, 07:13:36 PM »
so much this: I assume one would pay the expensive guest fees if you use the pro? Having a more structured reciprocity is great from a logistics perspective, like ease of booking and cost.
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John Kavanaugh

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Re: Private Clubs at a Crossroads
« Reply #83 on: June 11, 2019, 07:16:04 PM »
so much this: I assume one would pay the expensive guest fees if you use the pro? Having a more structured reciprocity is great from a logistics perspective, like ease of booking and cost.



Then why do you have a problem with the Dormie Network? Every course in the network is free to any member.

corey miller

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Re: Private Clubs at a Crossroads
« Reply #84 on: June 11, 2019, 07:17:21 PM »





How many non tier-one clubs should a tier-one club have a reciprocity agreement with?  Most tier-one clubs have a  well functioning admissions component intended to weed out those that are not gentlemen or gentle ladies.  Why should anyone at a tier-one club have to worry about a less vetted person showing up for a Sunday round?  Heck it appears Ran can't even vet a website for minimum standards of decorum.

Amol Yajnik

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Re: Private Clubs at a Crossroads
« Reply #85 on: June 11, 2019, 07:51:53 PM »
any chance we can de-hijack this thread and bring it back to its original intent instead of trolling/sarcasm?  there's a good discussion to be had.


That would be really nice.


FWIW, I'm 39 so technically in Gen X but close to being a "millenial" by the definitions I can find.  I live just outside of Boston, as a point of reference.  If it was just up to me in terms of what I was looking for in a club, it would be golf first and everything else a distant second.  Give me an interesting course to play that is well-maintained and I'm good, I'm not sure that I need a fancy locker room or a great restaurant at the club.  But I'm also married with a wife and one child, and what they would want to get out of a club would be much different from me.  I'd imagine that there would need to be much of the "other" stuff in there: pool, summer activities/camp for my son, and a good youth program as well.  It's just not a "me" decision to join a club, it would have to fit into how my family would use the club as well.  We've had some discussions around it, but my wife isn't interested in the dining options at a club and lots of the other activities in a club (pool/gym/etc) can be found closer and cheaper to our home.  The social contacts that can be made have an intangible value, but not enough to overcome the convenience factor of the other options at this time.


That said, the financial aspects of a private club make it difficult for me to even consider at this time.  Take the top-tier clubs out of the equation that are always going to have people that can pay the initiation fees, and there is a large group of people that are continually getting squeezed between higher housing costs (esp. in major cities), student loans, and stagnant wage growth as compared to past generations.  I realize that this type of characterization is centered around my situation and where I live, and could be very different in other areas of the country.


I don't think it will happen in this country with as much capital has already gone into clubhouses and other accouterments that are in many clubs, but I wish more courses would streamline things and just focus on the golf.  I read somewhere that the majority of restaurants at golf clubs lose money, so why have a full-service restaurant in the first place?  Maybe a club doesn't appeal to as many people by being a "golf-only" club, but if they make themselves more attractive to the core golfer, would that be a positive development in the end?

Mike_Young

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Re: Private Clubs at a Crossroads
« Reply #86 on: June 12, 2019, 07:14:28 AM »
My issue is that if one golfer can only afford a Camry we will all be forced to drive a Camry. I'm already seeing it from the untucked shirts to the slow greens. Every new rule introduced this year is an attempt to lower the bar of entry into the game.
John,The bigger issue is the guy managing and producing at the Camry plant.  If their goal is to build a Camry using BMW parts and options so that they can one day work at the BMW plant then the Camry will soon be out of reach of the buyers.  It's a flaw in the industry...
"just standing on a corner in Winslow Arizona"

John Kavanaugh

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Re: Private Clubs at a Crossroads
« Reply #87 on: June 12, 2019, 08:30:38 AM »
My issue is that if one golfer can only afford a Camry we will all be forced to drive a Camry. I'm already seeing it from the untucked shirts to the slow greens. Every new rule introduced this year is an attempt to lower the bar of entry into the game.
John,The bigger issue is the guy managing and producing at the Camry plant.  If their goal is to build a Camry using BMW parts and options so that they can one day work at the BMW plant then the Camry will soon be out of reach of the buyers.  It's a flaw in the industry...


Sure, and how long will it be before we roll the ball out of divots or worse, just play lift clean and place. Why pay for maintenance when there is always a good lie a club length away?

Ian Mackenzie

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Re: Private Clubs at a Crossroads
« Reply #88 on: June 12, 2019, 08:44:59 AM »
Ian,


Do you see any of this tied to the political philosophy and control of an urban area?  Do clubs in blue cities face a different environment those in red to purplish areas?


My theory has been that disposable income and affordability in the populations that play golf are keys.  The intersection of economics and politics (as the art against the art of economics) might be worth exploring.


Lou -


Not sure of the correlation.
Illinois is a blue state and Chicago is a blue town.


However, the "collar counties" (as they are called) where most of the private courses are, plus northern Cook county (where Chicago is), have a VERY purple/red hue to them. I would guess that at most private clubs the membership is majority republican - mostly for two reasons: lower taxes and less regulations.


The model is broken and many clubs will "bleed out" over the next 20 years.


As I have said in another thread, you know something is wrong when a "Doak 6" private club in Chicago costs $900/mo. and a "Doak 10" in Scotland costs $700 PER YEAR!!!!


But, cost basis of the land, real estate taxes and labor costs undermine the US model right from the Excel model spread sheet idea.

Jeff Schley

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Re: Private Clubs at a Crossroads
« Reply #89 on: June 12, 2019, 08:57:52 AM »
Ian,


Do you see any of this tied to the political philosophy and control of an urban area?  Do clubs in blue cities face a different environment those in red to purplish areas?


My theory has been that disposable income and affordability in the populations that play golf are keys.  The intersection of economics and politics (as the art against the art of economics) might be worth exploring.


Lou -


Not sure of the correlation.
Illinois is a blue state and Chicago is a blue town.


However, the "collar counties" (as they are called) where most of the private courses are, plus northern Cook county (where Chicago is), have a VERY purple/red hue to them. I would guess that at most private clubs the membership is majority republican - mostly for two reasons: lower taxes and less regulations.


The model is broken and many clubs will "bleed out" over the next 20 years.


As I have said in another thread, you know something is wrong when a "Doak 6" private club in Chicago costs $900/mo. and a "Doak 10" in Scotland costs $700 PER YEAR!!!!


But, cost basis of the land, real estate taxes and labor costs undermine the US model right from the Excel model spread sheet idea.

Also those Chicago clubs aren't open year round, there are a good 3-4 months where you can't golf there in the winter, thus your effective dues are 1/3 higher.

It is the maintenance costs that I feel are so far out of line with UK clubs as I'd like to see their income statement and what their expenses are for maintenance, both in labor and materials.  Some of it is climate and what is needed in certain climates, another part is the expectation of conditioning of US courses and meeting a XYZ standard.
"To give anything less than your best, is to sacrifice your gifts."
- Steve Prefontaine

John Kavanaugh

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Re: Private Clubs at a Crossroads
« Reply #90 on: June 12, 2019, 09:19:33 AM »
Sometimes you just have to pay more so good people can keep their jobs.

SB

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Re: Private Clubs at a Crossroads
« Reply #91 on: June 12, 2019, 10:08:30 AM »
What I love about this site is that everyone uses one tiny experience to extrapolate to an entire industry.  Some are even using a club that has not failed as an example of why clubs are failing. 


Since my uninformed opinion is just as good as anyone's, hereís how I see it:


1.   In the 80ís and early 90ís, most clubs had a very comfortable existence.  Most clubs were full and it was basically impossible to not be successful.  Barriers to entry were high because there was basically no financing available so few new courses got built.
2.   In the late 1990's there was a golf boom.  You can call it the Tiger Boom, but it really started before that, around the time the Golf Channel launched.  Boomers hit peak earning years and wanted to golf and move to golf communities.  Lots of new golfers came in, golf was hot and growing, and for the first time developers could build golf courses and they would be worth more than they cost.  Yes, Mike Young is correct that Wall Street money drove some of this, but it was the developers who built the courses because financing was now available, golf communities were selling like crazy and because golf was profitable.  Lots of golf courses got built thinking that boom would continue.
3.   In the early Ď00ís all those new golfers started dropping out and we were left with too many courses competing for too few people.  Golf courses and clubs are now generally worth less than the cost to construct them.  Thatís why few golf courses are now being built.
4.   Competition led to lower revenues for all but those at the top of the pyramid.  This accelerated rapidly in the great Recession, reducing membership levels in many cases significantly.
5.   Clubs that were not in a good financial position starting in the early Ď00s responded by either:  1) assessing members, 2) delaying capital investment, 3) cutting expenses, or 4) taking on debt.  The first two are short term fixes but long term trouble, number 3 needs to be done right, and number 4 can be fine but it needs to be the right amount and needs to be structured properly.
6.   Instead of being a very easy business, the golf business became very difficult.  The structure of being run by inexperienced volunteers who change every two years is not a good one in a difficult business.  The clubs that have been failing are those in competitive markets who did not make the correct decisions above, or perhaps there was no correct decision to be made due to location or other factors.  Most of the public courses that I look at have cut expenses too much or in the wrong place.  Most private clubs that I look at that are failing because they didnít cut expenses enough (or in many cases, they increased expenses) or because they delayed capital improvements for WAAAY to long.  There are some clubs that have taken on too much debt, but I would say itís the smallest group. 
7.   I disagree strongly that clubhouses are the problem.  Outside of this site, most people do not join only for the golf course.  Thereís plenty of public golf for people that only want golf.  Want the British model?  It's called a public course with a membership.  People join country clubs because the wife wants tennis, the kids want the pool, and more people than you think want the dining and social aspects.  Most of all, people want something of very high quality that fits their needs.  You donít have to listen to me, just look at what ClubCorp is doing.  They arenít for everyone here (this is more of a Dormie crowd), but they have a lot of experience and are pretty smart dudes who have been testing out a variety of reinvestment programs at clubs across the country.  And look where they have settled on investing money Ė Clubhouses, fitness, pools, dining areas.  They are not blowing up courses and remodeling.  They are not idiots and they are buying up and turning around the member owned clubs that do not reinvest in those amenities that everyone here hates.
8.   Millennials are not the problem (or itís too early to say).  The oldest are in their late 30ís, still years short of club-joining age.  I own an inexpensive public course and we are filled with millennials Ė on the weekends there are more millennials than boomers. 
9.   This entire conversation is a little strange, because most clubs are doing fine, or they should be.  Sure, there are exceptions and some recent failures, but generally those were the clubs that should have failed years ago and just managed to limp along to today, which is good because they probably cut a better deal than they could have 7 or 8 years ago.  Plus, there are some markets that are still horribly oversupplied.  Those markets will continue to shake out. 

JESII

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Re: Private Clubs at a Crossroads
« Reply #92 on: June 12, 2019, 10:10:36 AM »

It is the maintenance costs that I feel are so far out of line with UK clubs as I'd like to see their income statement and what their expenses are for maintenance, both in labor and materials.  Some of it is climate and what is needed in certain climates, another part is the expectation of conditioning of US courses and meeting a XYZ standard.




Jeff,


Maintenance costs aren't some of the problem...they are the vast majority of the problem in my opinion. The climate in Great Britain means grass grows slower and the nature of the turf and the architecture means the ball can sit a little closer to the ground and still meet expectations. On the largest line item for a club, to compare against another club able to do the same thing for 30% makes for a pretty tough comparison.


Add in the American notion that every "private" club should be exclusively private makes the math really tough.


Over supply at the moment.


Sounds harsh to say, but a 20% reduction in the number of courses would make the survivors a hell of a lot healthier...

Bernie Bell

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Re: Private Clubs at a Crossroads
« Reply #93 on: June 12, 2019, 10:37:59 AM »
Mr. Busch -


Want the British model?  It's called a public course with a membership.


Do you offer this at the course you own?  What has been the uptake?  How does the cost compare with the lowest cost fully private alternatives in your market? 
[/size][/color]


B.Ross

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Re: Private Clubs at a Crossroads
« Reply #94 on: June 12, 2019, 11:31:42 AM »

@kavanaugh - [size=78%]I have 0 issue with the dormie network, i think it's great. i'm all for things like dormie and hope it grows and they get more clubs closer to major cities. personally, i think they could only grow so much before turning into a club corp. most of what i've read about club corp clubs are that it's a glorified public experience in terms of pace of play & conditioning. i know that's not the case w/ dormie and will never be the case provided their new acquisitions are like the existing network.[/size]


@coreymiller - i understand your point, and i realize it's a bit of a catch-22 b/c the majority of the members at a tier-1 club don't even think twice about a guest fee at another private club when they travel and their pro sets something up for them (or a day their local club has restrictions for some reason), yet there are members for whom the economics of these clubs are steep enough as it is and said additional expenses matter. So should club policy serve the majority or strive to help the lowest common denominator member which in turn helps everybody?


as for tiering besides the obvious clubs in the US top 100 (maybe top 200-250) lists, how does that work? i ask b/c i don't think using say the golf week modern/classic top 200 lists to say all those clubs would be tier-1 would be fair. i say this b/c there's a club on the classic list just outside my hometown that's now corporately owned, on the verge of NLE and can be accessed now not only via club corp travel & troon prive but also through other mini memberships.




Kalen Braley

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Re: Private Clubs at a Crossroads
« Reply #95 on: June 12, 2019, 11:40:46 AM »
To switch gears a bit, even if I was in position to comfortably join a club, I don't think I would. I'm not into the one golf club monogamy thing... I like variety and I like it as much as I can get it.  Sure if it was something epic like a Cypress Point or equivalent  that would be a no-brainer, but that's so far out there, its not even a pipe dream.


However, I could see joining a club in the UK where the financial part actually makes sense (rounds played vs cost) as a place to play after work and mix in some social mingling.




John Kirk

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Re: Private Clubs at a Crossroads
« Reply #96 on: June 12, 2019, 12:07:01 PM »
What I love about this site is that everyone uses one tiny experience to extrapolate to an entire industry.  Some are even using a club that has not failed as an example of why clubs are failing. 

...

9.   This entire conversation is a little strange, because most clubs are doing fine, or they should be.  Sure, there are exceptions and some recent failures, but generally those were the clubs that should have failed years ago and just managed to limp along to today, which is good because they probably cut a better deal than they could have 7 or 8 years ago.  Plus, there are some markets that are still horribly oversupplied.  Those markets will continue to shake out.

If you go back in this thread far enough, you will see some links to macroeconomic data.

Speaking anecdotally, the membership at my local private club is down substantially.  The number of rounds played has also fallen.  Initiation fees may be at a low level, but that's hearsay.

One aspect of Mike Bodo's opening post that has not been discussed is the potential impact of a recession.


"Outside of the elite and many top-tier private clubs, will there be a mass closure of private golf/country clubs when the next recession hits or will some or many be saved by becoming aligned with reciprocal club networks or going the daily fee route?" 

It's been eleven years since the last recession started, which I believe historically is a very long period of economic growth.  It's up to each person to study and make their own conclusions about the future, and what might happen to any investments made towards joining a golf club.


John Kavanaugh

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Re: Private Clubs at a Crossroads
« Reply #97 on: June 12, 2019, 12:14:23 PM »
Considering that Mike P just passed away at 70 you best be getting all you can get now. Join every damn club that will have you.

Lou_Duran

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Re: Private Clubs at a Crossroads
« Reply #98 on: June 12, 2019, 03:20:30 PM »
Those who are seriously interested in the subject matter should take heed to what SBusch writes.  The guy has been in the trenches for years; he is a pro.


Re: adopting the UK model, but for a very few places, it is impossible.  As Ian M notes, our cost structure is completely different.  And so are our expectations.  Unlike Royal County Down which hosts 15k unaccompanied visitor rounds annually, I can't see members of Pine Valley or even my modest home course tolerating even a fifth of those.  As John K has pointed out previously, we are willing and able to pay for relative exclusivity.[size=78%]  [/size]

Rick Lane

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Re: Private Clubs at a Crossroads
« Reply #99 on: June 12, 2019, 03:42:58 PM »
Tom D said it best, of course its supply and demand.   But the answer to "why" is likely different in different regions or countries?
At our US east coast club, we would like to have 320 full members and we are maybe 10% currently short of that, so for revenue we added classes......social, pool and tennis only, preview, Junior, etc.    Its a slippery slope as more bodies are around but maybe we STILL have less revenue than the optimal (read: old, baby boomer) model.
Maybe its as simple as the boomers drove the 90's (I'm a boomer who joined at age 40) and now Genx  is a smaller generation of 40 year olds, and the Millenials, a larger generation aren't quite old enough yet?    I think that's a big factor.   Another big factor is that the previous generations maybe had the type of jobs where they stayed in one place with 2-3 job changes.    I see my millennial kids not in a place where they can plunk down the initiation fee, as they have a view that they might have ten jobs in 10 different cities in their lives so no way can they even consider a club now. 

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