How not to run a golf club ...for that matter, any business

Recently, I and many of my fellow community and golf club members, had the misfortune of loosing the golf club located in the midst of our neighborhood. It is not one of the major misfortunes of the now struggling US economy. However, it is a tragedy for some workers who had the misfortune of working for a failing business.

Those of us who were members will just move along to another golf course and continue to play our silly little game. The former employees face a bleak jobs market with virtually no golf courses hanging-out help wanted signs. To a great extent, the golf business is a failing business. With each failed course, the failure means the loss of livelihood for about twenty workers. this loss of jobs is the real concern. Those of us who attempt to play the game will move our business to one of the survivors.

When a business fails, it can be a worthwhile exercise to look back at what drove the failure. Usually, as is likely true at our course, there are many factors.

Before we look back, take a look at the table shown below. Some statistics about the golf marketplace are helpful in understanding how tenuous the golf club business can be.

With the price of golf at about thirty dollars per round, clubs are by nature high risk. The future for golf clubs is laced in changing demographics, uncertainty in the economy, and the effects of a wide variety of other activities that children and adults pursue. Consequently, many golf clubs will follow the path of the dinosaur. To counter the evolutionary fact that many Americans are moving beyond golf as a leisure activity, clubs have done many and varied things to keep current members or to attract new members.

With the fact being that almost all golf courses are struggling, let's look at how the management of one course attempted to stem the tide of departing members and per round players.

A brief review of the club shows the following:

• The club is embedded in a community of approximately 1000 homes of moderate to high value, with householders in the middle to upper middle income class and a few moderately wealthy.
• The course is mature, approximately thirty years old.
• The course is mortgaged in the amount of two million plus dollars.
• Over the past several years the course has struggled with multiple owners, most of whom were under-financed.
• The course slide into disrepair over the past several years. Greens and fairways deteriorated and are in bad shape. The sprinkler system was mostly in failure mode. Management scrimped on fertilizer, insect chemicals, workers to perform maintenance activities and maintenance equipment. Denial of qualified golf operations, greens keeper, social activities management, and general management talent was followed to generate what become false savings.
• Club house facilities, the sports bar, swimming pool, tennis courts for the most part have been poorly run as has the pro shop, new golfer programs, and other club activities / amenities.

When things got really tough financially, course maintenance was seemingly at a low, members were continuing to abandon ship, management choose to take $100,000 out of the year's maintenance budget. The course deteriorated further and finally culminated in the course closing.

As the club traveled down this pathway to financial failure and closure, one management action stands out as indicative of the clubs failings.

NOTICE: FINAL COMMUNITY CLUB MEMBERSHIP INVITATION was sent to all property owners within the community ...an invitation to join or else.

The business management takeaway NOT: When your business is showing signs of failure, threaten your customers and potential customers in an attempt to coerce use of your product and services else be damned to inevitably, suffer the consequences ...an all new high point in customer relationships management.

Else happened. The club is closed. The business is defunct. The remaining land lies dormant. Weeds grow higher and higher. The club is no more. May it rest in peace.