Worrying times ahead for golf clubs

[sunshine]

Good point because you can bet your ass they won't put prices down when energy prices drop

It would be prudent to freeze prices rather than drop them if energy prices dropped. I don't have any stats, but how many golf clubs in the UK are looking to make a profit? Municipal courses serve the community, members clubs exist for the members, neither are looking to make a quick buck from subscriptions.

 

[Neilds]

It's true that golf clubs along with multiple other businesses face considerable challenges this next 12months, government help notwithstanding.
Will some close? Possibly. Will some struggle? Probably. But without knowing the financial circumstances of every single golf club member its very difficult to predict.
Golf clubs have a high percentage of older demographic in receipt of work and state pensions and/or mortgages paid off. This crisis might pass them by, or not affect them as much.
Newcomers attracted to golf in Covid times may drift away, having other more important pressures eg. End of fix rates mortgage deal a doubling of percentage on a new deal could easily wipe out golf club subscriptions as could domestic energy costs.
It's all an unknown. Personally I think we could return to pre-covid figures regarding membership and golf clubs will need to be pro active in retaining their present membership and trying to encourage new

This is what our club is doing - Top Tracer going into the range as we speak and work started on improving the bunkers (Durabunker doing the work). We had an email earlier in the year saying the enrgy prices were fixed until this time next year (if I recall correctly) so we are still looking to the future and investing in the club and infrastructure.

 

[Jaco]

Just saw this report on the BBC website.
https://www.bbc.com/news/uk-england-wiltshire-62808811
Broome Manor has a biggish clubhouse but not unnaturally so. A £144,000 increase means £360 per head for a 400 member club or a £240 increase for a 600 member club.
At this sort of level some clubs might struggle to get through the winter before April renewals without a levy or closing the clubhouse for periods.
When you couple this with all the other inflationary pressures golf clubs face (huge increases in machinery and chemicals plus necessary staff wage increases) there will need to be significant fee increases for 2023 which will come after a tough winter for many members. If membership decrease from their current high levels due to these increases then more of the burden will be on the remaining members.
I’m glad I do’t have to set the budgets and fees for next year as it’s going to be a very difficult balancing act.

Some people talk about these issues as if A) it’s in some way a failure of management within the business, or B) it can be solved by either upping subs by £ 500 or charging £ 20 a pint.
It isn't and it can’t be. People will simply jack in their membership and stop drinking.
If your house energy bill went from 3k to 20k, you’d think it was completely unsustainable. Same with most small businesses. They don’t run on multi million pound balance sheets, on the whole.

 

[milngavie_hacker]

Our club is having a finance briefing for members at the end of this month to give a view on where finances are at end of season versus forecasts and how we are performing in year two of what is a five year plan. Secretary clear information won’t be audited or final accounts but should give an indication of challenges next year and likely direction on fees next year. Our membership fee this year was £750 so even a 10% increase should be manageable for most spread across the year on the direct debit scheme.

 

[Blue in Munich]

Apparently we currently have a 2 year locked deal for our utilities on the clubhouse of £50,000. When that ends next year, the renewal quote is £176,000. So we looked at an alternative quote and were offered £212,000.

Whilst these are worst case scenarios, it looks like the subs will be going up somewhat next year.

 

[clubchamp98]

Apparently we currently have a 2 year locked deal for our utilities on the clubhouse of £50,000. When that ends next year, the renewal quote is £176,000. So we looked at an alternative quote and were offered £212,000.

Whilst these are worst case scenarios, it looks like the subs will be going up somewhat next year.

Jeez that must have been a shock.
But you can see why the whole country might be on strike for more pay with quotes like that.

 

[Blue in Munich]

Jeez that must have been a shock.
But you can see why the whole country might be on strike for more pay with quotes like that.

Trouble with that is the knock on effects. Take yesterday's match; normally there'd have been 6 of us in the pub. 6 meals, a few rounds, it would put at least £200 over the bar. 3 of us couldn't get to the match & missed it; the other 3 took nearly 4 and a half hours for a round trip that is normally an hour and a half. I wonder how many more had the same issue? We've been using the same pub for years & know them well, the licensee says that the football days basically cover their running costs. So whilst one side strikes for more pay, another potentially loses their livelihood.

 

[clubchamp98]

Trouble with that is the knock on effects. Take yesterday's match; normally there'd have been 6 of us in the pub. 6 meals, a few rounds, it would put at least £200 over the bar. 3 of us couldn't get to the match & missed it; the other 3 took nearly 4 and a half hours for a round trip that is normally an hour and a half. I wonder how many more had the same issue? We've been using the same pub for years & know them well, the licensee says that the football days basically cover their running costs. So whilst one side strikes for more pay, another potentially loses their livelihood.

Yes but that could give some people a choice golf or footy with your mates.
Tough decision.

 

[Blue in Munich]

Yes but that could give some people a choice golf or footy with your mates.
Tough decision.

Whilst I think I understand where you are coming from, I have little sympathy with the group causing yesterday's issues when you look at their average salary.

 

[clubchamp98]

Whilst I think I understand where you are coming from, I has little sympathy with the group causing yesterday's issues when you look at their average salary.

I think that maybe a London specific problem.
More so than any other city who don’t rely on trains so much.

 

[TheDiablo]

As there has been some comment on the £1000 (actually a little under) for our new Introductory Membership. This is for period to renewal next 31st March and is pro rata annual subs and in addition full joining fee is payable. We are ~£1800/yr subs and same for joining fee. This option is aimed at those on the waiting list who are very keen to join ASAP, and are willing to commit in advance to taking up full membership next year.

We feel able to do this as we believe we have the course and tee time capacity (to be reviewed at renewal time) and we need to manage our waiting list as we can’t just expect prospective members to sit and wait - they can easy go elsewhere if they get fed up waiting and openings present elsewhere. The additional income will mitigate some of the impact of the power increases (as well as all other increased costs) on our funds and next years subs.

On @fundy comment. I’ve checked and non-weekend golf is actually any time and weekend golf is afternoon only (I don’t know first tee time for that). The new Introductory membership is exactly that - a ‘staging’ membership to full membership and not an ongoing membership. At renewal time the Introductory Members will each pay full subs to become full members - they have already paid the joining fee. Our expected turnover of members is about 30.

We then decide if we want or need to replenish the Introductory membership from the waiting list - and if we do we may decide to just do this replenishment at this time of year.

It may not have been public knowledge but you trialled this last year with a few select on the waiting list. My old man got in on this deal as he knew a few people and converted to full this year

It’s a very good idea imo

 

[SwingsitlikeHogan]

It may not have been public knowledge but you trialled this last year with a few select on the waiting list. My old man got in on this deal as he knew a few people and converted to full this year

It’s a very good idea imo

Now that you mention it…?

 

[Red devil]

Apparently we currently have a 2 year locked deal for our utilities on the clubhouse of £50,000. When that ends next year, the renewal quote is £176,000. So we looked at an alternative quote and were offered £212,000.

Whilst these are worst case scenarios, it looks like the subs will be going up somewhat next year.

That really is nothing short of outrageous.

 

[hovis]

Apparently we currently have a 2 year locked deal for our utilities on the clubhouse of £50,000. When that ends next year, the renewal quote is £176,000. So we looked at an alternative quote and were offered £212,000.

Whilst these are worst case scenarios, it looks like the subs will be going up somewhat next year.

Did I read this right. £212,000 to heat at light your club house?

 

[D-S]

The £50,000 figure stacks up well with our club as at last year.

 

[Slab]

And just think of the clubs with 60+ buggys to charge each night!

 

[SwingsitlikeHogan]

Meeting at club (and on zoom) this evening when options for clubhouse redevelopment/refurbishment will be presented with committees recommendation to members. This has been ongoing for some time now but who knows what the financial chaos of recent weeks will have done to plans, funding and timescales.

 

[SwingsitlikeHogan]

Interesting and very well attended members meeting last night looking at proposals for clubhouse.

Main constraints are planning (as we are in a highly protected rural area) and funding (obviously) so plans are cautious, as they have to be. Planning effectively rules out building a new clubhouse in either a new location or indeed the current one. We are advised that costs associated with putting together proposals and a planning application would take years and costs a packet - with a very high risk of failure. Besides in the current and foreseeable financial environment a new clubhouse is unaffordable unless a fairy godmother comes along and sprinkles the club with stardust.

One thing that came out of the meeting was the horrendous potential increase in power and gas as we have just come off a fixed rate. Prior to the recently announced government cap the best we could get was a 6-fold increase. If we were paying £30,000 a year - go figure...

The thing is...it appears that for the club the current government cap on power rate is only until end March 2023...so not the two year cap that applies to residential usage. We have no guidance from suppliers as to what might happen after then, and so we have to assume that the 6-fold increase over our old rate previously provided could kick in. And as much as we might have been trading the last few years with a decent enough surplus that would be wiped out. We would have to have a good look at our clubhouse plans.

 

[Springveldt]

Interesting members meeting last night looking at proposals for clubhouse. Main constraints are planning (as we are in a highly protected rural area) and funding (obviously) so plans are cautious, as they have to be.

One thing that came out of the meeting was the horrendous potential increase in power and gas as we have just come off a fixed rate. Prior to the recently announced government cap the best we could get was a 6-fold increase. The thing is...it appears that the current guarantee cap on power rate is only until end March 2023...so not the two year cap that applies to residential usage. We have no guidance from suppliers as to what might happen after then, and so we have to assume that the 6-fold increase over our old rate previously provided could kick in. And as much as we might be trading the last few years with a decent enough surplus that would be wiped out. We would have to have a good look at our clubhouse plans.

I can see a lot of clubs just simply shutting the clubhouse down when they come off fixed rates and there is no government cap in place. They won't be able to justify a 4 or 6 fold increase in energy prices.

 

[Albo]

I can see a lot of clubs just simply shutting the clubhouse down when they come off fixed rates and there is no government cap in place. They won't be able to justify a 4 or 6 fold increase in energy prices.

Yes me too, but that brings about its own issues, members may well, and quite rightly, feel they are getting less for their membership as a result and even by shutting the clubhouse, I suspect members fees will still need to increase which will exasperate those feelings.
It’s a long and dark road ahead