Unjust Golf Rates!

[Spyder]

So, I'm sure many of you from the Midwest and Northeast are playing on courses that are still "waking up". The trees are somewhat barren or have their buds starting to open. The grass is now a rich, dark green and is thickening with each 60-70° day that passes. Bunkers are being filled and turned and greens are being rolled.

Most courses will run their winter rates in Ohio until the first week or two of May, at which point they increase to prime rates (usually a $10-25 jump).

However, my home course, where I put in the majority of my practice, was charging $25 for 18 holes + cart all of last season. This course used to be a joke to anyone within 20 miles of it and it was often called a "dog track", "cow pasture", "s*** hole" -- you name it, it was called it.

Now, the course is still under construction. It has been under construction for nearly 3 years.

The initial improvement was night and day with just the mowing and fertilizing alone. However, there are still many areas of the cart path that you have to gas and brake at the same time over, or completely avoid, so that your clubs do not fly out the back of your cart.

There are massive dips, craters and ruts in the path due to erosion and cheap materials used to lay it. We were joking the last time we were there and said they should issue ATVs rather than carts.

There are still approximately 4 greens that have "Ground Under Repair" signs surrounding bare spots where the deer eat the grass, which has not changed in 3 years. If anything, the course is now worse because they are rebuilding 4 tee boxes and the solution in the meantime was to simply move the markers down in front of the tee boxes to areas that are not mowed, are untreated and muddy and are no wider than a 5' diameter. You can only put a tee in the ground because other people have already taken so much grass off from their driver, 3W or irons.

There are also unsightly heavy machinery stationed all over the course with many areas of bare dirt where digging is occurring.

I'm not a disgruntled regular that goes there, but I am friends with the manager of the course and I also  golf with many of my friends who prefer to golf only there.

I know that the course needs to make money to spend money, but sometimes you have to realize that in this world.. you must spend money to make money. I know that I can take my business anywhere else and I don't have to go there, but I simply do not want to see the course go under due to no one golfing there.

My question is, how the hell can this place charge $34.00 to golf 18 holes when the conditions are worse than last year when they charged $25.00? Has anyone else experienced anything similar? The principle just frustrates the hell out of me and I don't know why.

I'm just curious if you guys have any ideas in terms of A) Why would a course implement the logic of increasing the cost of a round when the conditions are worse than they were? B) Surely, this logic is not going to result in success right? I've seen the parking lot nearly empty on 70° and sunny days in Ohio in April... that is nearly impossible to do!

[RayG]

Those conditions in the LI/NYC area would justify a $65 rate... so quit yer whinin'! :-D

[Spyder]

Originally Posted by RayG

Those conditions in the LI/NYC area would justify a $65 rate... so quit yer whinin'!

Again, I'm not whining. I have played courses in NYC and I can tell you that you are exaggerating as well. I have also played on courses with rates 3 and 4 times that amount and walked away extremely happy as well, so it's not a financial concern either. My key word in my initial post was that I am questioning the principle of raising rates during sub-par conditions due to construction.

I am looking for actual insight as to whether this type of methodology of performing construction at the same time as raising the rates prior to the desired achievements being completed has any potential for success in the golf industry.

Thanks though.

[David in FL]

From the course management perspective, if they're not making money at $25, and they will make money at $34, even with a smaller number of golfers playing the course, it makes sense.  In fact, reduced traffic should also help improve course conditions.....

From your perspective, price is up and quality is down.  Overall value is down as a result and I'd be looking for an alternative that provides better bang for my buck.  Sometimes, all we can do is vote with our feet.

May be worth checking GolfNow or one of the other discount on-line booking sites too.  You may find better rates there.

[MSchott]

I applaud your loyalty but this place does not deserve your business and if they have a bad business model they deserve to go out of business or be bought out. It sounds like they do not have the money to finish the work they have started which is not uncommon these days. However I don't understand the policy of raising the green fees by 36% without offering any benefits. Take your business elsewhere.

[David in FL]

Originally Posted by MSchott

I applaud your loyalty but this place does not deserve your business and if they have a bad business model they deserve to go out of business or be bought out. It sounds like they do not have the money to finish the work they have started which is not uncommon these days. However I don't understand the policy of raising the green fees by 36% without offering any benefits. Take your business elsewhere.

It could very well be a good bu s iness model.  Just not good for the individual golfer.....

[MSchott]

Originally Posted by David in FL

It could very well be a good business model.  Just not good for the individual golfer.....

Not sure what you mean. Can you explain please?

[iacas]

If they can get the same amount of play at the higher cost, or lose less than the % the fee was raised, it's a good business plan.

[David in FL]

Originally Posted by MSchott

Not sure what you mean. Can you explain please?

As iacas says.....

A simple example:

Rates are raised 36%.  In doing so, they drop 20% of their rounds played due to lost customers, both current (who are ticked off) and new (who don't even try the course because of the price point).  If they were getting 500 rounds a week at $25, they're now getting 400 rounds at $34.  An increase in weekly revenue of a little more than 7%.  In addition, fewer rounds played means less wear and tear on the course, lower maintenance/repair costs and lower labor costs (few rangers, starters, pro-shop associates, etc....).....as a result, the net margin could be up 10% or more.  Since the course is less crowded, pace of play may improve and satisfaction of those golfers that are playing the course may improve.  In time, as word gets around, the 20% reduction improves while the 36% increase in rates remains, driving even better margins.

Again, just a simple example, and I didn't factor in any food/beverage sales, but overall, a better business model, from the perspective of the golf course.....

Me, I'd be one of the 25% and take my hard-earned $'s somewhere else though.  At least until conditions improve to the point where my perceived value comes into line with the new price point.

[Spyder]

I appreciate your guys's insight. I guess I should have worded my initial post more clearly as well for other readers so that I could get their opinions as well. After reading my thread again, it comes off sort of ...the other word for "whiny" lol. My overall question was just based on business model, how this is justified and could it be successful and how so? If anyone has seen this done with success.

In terms of business, it seems like they are definitely much slower than before the increase, but I am not there enough to justify and although I am close friends with the manager... it's not my business or ethical of me to ask how business is doing in literal/financial terms.

I do plan to avoid the course, but the part that burns me up is that I pay $45.00 per round at my home course and the two courses being judged side-by-side would be a B vs D- on a grading scale (with A+ being this local course within 1.5 miles of my home: http://www.golfblueheron.com/index.php ).

Originally Posted by MSchott

I applaud your loyalty but this place does not deserve your business and if they have a bad business model they deserve to go out of business or be bought out. It sounds like they do not have the money to finish the work they have started which is not uncommon these days. However I don't understand the policy of raising the green fees by 36% without offering any benefits. Take your business elsewhere.

I really don't think you're far off either. I honestly think they're trying to recoup costs mid-way through their progression. If it were me personally, I would have to do whatever I could to lower the rates, hope for more play (which won't effect their progress at this time as construction areas are all roped off at this time) and keep steady revenue incoming. This is how I ran a successful business and I stand by this model. In this case, the companies performing the construction and improvements are all third-party and contracted - not staff, so the increase in play on the course is not going to slow down the progression by demanding more maintenance out of my superintendents and crew.

I am also under the impression that not many people would be faithful and say "I see the construction occurring and I know it is bettering the course, so I will continue to golf here and accept the increased rates knowing that I will be golfing in better conditions.... some day ." In my experience, people want value for their 'buck when they place it on the counter.

[saevel25]

Originally Posted by Spyder

I appreciate your guys's insight. I guess I should have worded my initial post more clearly as well for other readers so that I could get their opinions as well. After reading my thread again, it comes off sort of ...the other word for "whiny" lol. My overall question was just based on business model, how this is justified and could it be successful and how so? If anyone has seen this done with success.

In terms of business, it seems like they are definitely much slower than before the increase, but I am not there enough to justify and although I am close friends with the manager... it's not my business or ethical of me to ask how business is doing in literal/financial terms.

I do plan to avoid the course, but the part that burns me up is that I pay $45.00 per round at my home course and the two courses being judged side-by-side would be a B vs D- on a grading scale (with A+ being this local course within 1.5 miles of my home:  http://www.golfblueheron.com/index.php).

I really don't think you're far off either. I honestly think they're trying to recoup costs mid-way through their progression. If it were me personally, I would have to do whatever I could to lower the rates, hope for more play (which won't effect their progress at this time as construction areas are all roped off at this time) and keep steady revenue incoming. This is how I ran a successful business and I stand by this model. In this case, the companies performing the construction and improvements are all third-party and contracted - not staff, so the increase in play on the course is not going to slow down the progression by demanding more maintenance out of my superintendents and crew.

I am also under the impression that not many people would be faithful and say "I see the construction occurring and I know it is bettering the course, so I will continue to golf here and accept the increased rates knowing that I will be golfing in better conditions.... some day." In my experience, people want value for their 'buck when they place it on the counter.

One, are people showing up to pay this $34.00, meaning are the filling tee times? If so then there is nothing wrong with the price. If people are willing to pay $34 with a cart to play 18 holes under those conditions, the course is priced were it should be. If you find it over priced, then you can play somewere else. Its supply and demand 101. There is a demand to play golf, there is a limited supply of tee times. If people are willing to fill those tee times for $34 dollars, then they priced it right. I find Apple products are usually overpriced due to paying just to have the apple logo on the product, but other people buy there products like a thirsty person buying a bottle of water.

Also, how do you expect a course to get better if it has no revenue to improve the condition. It could be a risk to raise the prices, but for them it could be make or break year to get some capital to fix up the course.

[Eddie Weatherby]

Can't businesses charge what they want in a free market?

A better question would be why would you play such a place?

It sounds as if they need to go under.

[flintcreek6412]

Ask your friends that only like to play there why that is.  They might be able to provide an added value to the course above conditions that you don't notice.  For some people, the social activity is actually more important than the golf.  If they provide leagues and other social interactions that other clubs don't provide they may continue to get the play even at the increased price.

I've played some decent courses that charge well above the average for the area.  You show up, golf and leave.  The clubhouse is virtually empty. Course conditions were great but the experience was kind of empty.   I've also played some "goat ranches" that are absolutely packed and the clubhouse is full of guests eating, socializing and having fun.  Coming in on 18 you always have an audience on the patio.  Nothing like hitting it thin from a fairway trap over the green and into a group of judges having cocktails.  That was awkward.  Those gold ole boys and gals wouldn't leave that course for anything and in the day it was one of the premier private courses in the area.

[anthony]

The course closest to where I live, aside from two private courses I can't play, is the same way. They charge almost twice what this course is worth imo. The greens are like stone and long at the same time somehow. The layout kinda sucks too and forces a lot of irons off the tee. That said, I'd play it all day if it was cheaper. So, instead of a 10 minute drive, I drive 30 minutes to play nicer courses that cost less. Oh well.

[MSchott]

Originally Posted by iacas

If they can get the same amount of play at the higher cost, or lose less than the % the fee was raised, it's a good business plan.

I get that. I guess from my point of view, a course in rough shape that raises their rates that much is going to lose a lot of business. It depends on how much competition there is in the area. If they are the only game in town then it shouldn't be a problem.

[iacas]

Originally Posted by MSchott

I get that. I guess from my point of view, a course in rough shape that raises their rates that much is going to lose a lot of business.

Maybe.

[saevel25]

Originally Posted by MSchott

I get that. I guess from my point of view, a course in rough shape that raises their rates that much is going to lose a lot of business. It depends on how much competition there is in the area. If they are the only game in town then it shouldn't be a problem.

But your only thinking in terms of that business as an isolated entity. When in fact there are things like location, what are the prices of the other golf courses around them, are they looking for repeat customers. Is the price low enough that no matter what, someone will come out and play because all the other courses are packed. There's alot more to consider. Also consider this.

think of it this way, lets say they get 100 golfers in a day, that's 25 foursomes

For the $25 dollar model, you get $2500 dollars

So what would be the amount of people needed to reach $2500 dollars under the $34 dollar model, 74 golfers. 6.5 less foursomes. So unless they don't see a 26.5% drop in golfers, they will make more money under the $34 dollar model.

That's the beauty of math, you can up the value, as long as you don't see a larger percentage drop in customers as you do in the percentage increase in price, you will make more money.

[thanw]

This sounds like the complaint about the restaurant where the food was terrible AND the portions were too small. I will drive a long way to play a course in excellent shape and more than willing to pay $34 for the privilege. I wouldn't play a goat track if it was free and right across the street.