Being in the Know
Golf is changing. The tradition of golf lent a certain mystique to the game, and the industry itself did not typically embrace golf technology. But times are changing. People’s lives are busier, and the growth of the game has leveled off. It’s time to start thinking more like a business.
“We know how to go out and play golf and keep score,” says Ray Mundy, a golf course consultant. “But we don’t know how to keep score in running our business.”
Technology can help golf course operations “keep score,” but owners and operators have to know how to understand and utilize the data.
“Early on we saw people get management information systems doing what they need them to do on a regular basis. They are just ringing up people, checking them in, reconciling their day-to-day activity,” Mundy says. “But they really don’t take that next step where the system presents the data to you so you can sit back and really analyze what the trends are telling you.”
The time it takes to gather large amounts of information over a wide area has also dropped dramatically over the past two years.
“For management companies there are now systems that exist where through a Web component a central office can view their revenues from all their courses, real-time on one screen. With the click of a button they can instantly consolidate all the course financials into one report. Having to fax, e-mail, upload or synchronize data is a thing of the past. What used to take hours, now takes seconds.”
Being Proactive
Mundy recommends that golf course operators use management information systems to get ahead of the curve. “Often club managers and golf professionals are spread so thin that it is after the fact that they realize that the business is going in a different direction or a trend is happening. They are running their business in a much more reactive way instead of trying to get proactive in their planning and development and understanding before a crisis comes up.”
Operators can utilize reports of certain day-to-day criteria such as average shop sales per round, average green fee per round and average food and beverage sale per round. “If you are monitoring those things on a daily or weekly basis,” Mundy says, “it’s not an exact science, but it’s a trend to indicate where you are.”
Walt Lankau, owner of Stow Acres Country Club in Stowe, Mass., has stayed ahead using technology proactively. “I put in a computerized point-of-sale system in the first year, and I’ve been in business 20 years or so,” he says. “I’ve kept up with the new generations of software. We know every day exactly what we sell, and we can compare it to the same day last year or the year before giving us as much detail as we want.”
Mundy uses the example of a reduction in beverage cart sales as a way to be proactive. “If the operator understands what the thresholds are on a day-to-day basis—for example, for every golfer who walks in here, I expect $3 per round from the beverage cart—then if I teed off 100 golfers from noon to 4 p.m. on Friday afternoon, I would expect to do at least $300 on the beverage cart. Then if I look at that daily activity and see that there was only $100 done on the beverage cart, something happened. Either the person didn’t get out and service customers appropriately or there could be theft going on in the operation, that kind of thing.”
Having this technology for daily reports arms the golf course operator with enough information that if they look at a few key business indicators, they can more effectively run their business and ask the right questions.
Key Business Indicators
Mundy advises focusing on four key business indicators on a day-to-day basis:
- Revenue that is generated in the last day and the last week in the golf shop and in the entire operation- “You take that revenue and immediately compare it to your budget, so you can immediately see on a day-to-day basis what your run rate is doing and how you are doing so far this month versus budget,” Mundy says.
- Accounts payable
- Receivables
- The cash and current financial position
“If I know how much I am generating on a day-to-day basis, how much is owed to me, how much I owe others and the current position of the operation—I have pretty good indicators on a day-to-day basis of the financial health of the organization and how we are progressing according to budgets,” Mundy says.
Faster and More Efficient
Though simple revenue reports are fairly easy to generate, certain software systems can generate more complicated reports, such as average revenues per round, to give operators an indication of trends. Another bonus of technology is being able to extract information much more quickly and efficiently.
“Most revenue versus budget reports and key indicators can be compiled within a matter of minutes each day without having to depend on the controller from a department or the bookkeeper to compile the information,” Mundy says. “Efficient operators have the metrics in place to measure those indicators. If they don’t, I kind of relate it to playing basketball without a scoreboard.”
Take Advantage of Training
Mundy encourages golf course operators to call their software company and receive training on compiling data. “Most of the software companies do a good job servicing their clients,” he says. “Get involved with users groups and monthly Web training, and make it a priority. Golf is an important part of what you are doing, but if you don’t have the business side addressed, you are not going to be as successful.”