It’s survival of the fittest in today’s crowded golf economy
During the “Tiger era”, the game of golf has experienced exceptional growth, and has left a substantial footprint on the economic landscape in Canada and around the world. Over this time, courses have been popping up everywhere creating more options for golfers to play the game, while at the same time creating significant competition among the industry. Healthy competition can produce great results, but how much is too much? The Niagara peninsula alone is home to over 70 courses and counting, and is starting to show signs of stress.
Golf courses in Niagara peninsula
Green fees have been on a steady decline throughout the region as golf clubs try desperately to contend with rival competitors. Membership deals and weekly specials have golf courses undercutting each other at dangerous rates. New course construction has in fact slowed in the last couple years, which may indicate the calm before the storm. And since operating costs increase considerably on a regular basis, it won’t be long before $29 for a round of golf won’t cut it anymore, forcing clubs to either raise their prices and risk losing members, or simply go out of business due to yearly losses.
Regulating fixed golf prices around regions like Niagara, which would oblige clubs to work together on the issue, seems to me like a viable solution, though I understand the idea has been refused almost unanimously in the past. People may reconsider if this trend continues, but for now, cutting costs and finding ways to be super efficient in all areas, including maintenance practices, is the only way to survive, especially for already low budget courses.
I would imagine eventually discount-price courses will show signs of wear and tear, while courses that charge what it takes to give golfers a great place to play will look and perform better. Is that not a way for courses to distinguish themselves, or has the recession swung the pendulum so far that it can’t come back far enough for courses to charge what they should? It’s like cheap beer — it’s OK if you’re not passionate about beer, and maybe sometimes it’s OK. But if you value your golf experience and you’re passionate about the game, I’d think you’d patronize a courses that looked after itself rather than one advertising cheap golf.
I wouldn’t say the game of golf is immune to a recession; it’s not. But I don’t think a recession is the real concern. This is a simple case of supply and demand. Right now the supply outweighs the demand which, as economics shows us, drives prices downward. Golf cannot withstand significant drops in revenues as the price of things like pesticides (up 3X in price in the last 2 years), wages and equipment continue to rise. It’s easy to say, “Just create better conditions and charge more”, but the reality is, low to mid-budget courses can’t afford that miracle makeover and must find other ways to complete.
The result is lowering prices and trying to do more with less which, in my opinion, is taking one step forward and two steps back. This not only digs courses into deeper holes, but adds to the unhealthy stress levels of passionate turf managers who want nothing more than to create the best product possible for the golfers.
As you might be able to see, I was a bit handcuffed by the 250 word limit on this topic. I could talk at length about possible solutions to this issue because I think it is an important one to solve.
There are some excellent low budget clubs out there that have been forced to find ultra-efficient ways of maintaining their golf courses, but are fighting a losing battle under the current economic conditions.
Great post. I think the market will sort itself out.
I think your image could use an explanation. I assume the pins represent golf courses.
I really like your writing style. It’s kind of breathless and fun to read. I challenge you to really edit your next post. For instance, instead of “rival competitors” just say “competitors” or “rivals.” You are already a great writer and will be even better if you edit your work mercilessly. Try writing your next post and letting it sit for 24 hours before re-editing and posting.
Andrew