Falling Subs : Is it really good news?

Sandwich

Not wanting to hijack the 'Dublin Memberships' thread.

It started me thinking though : is there a race to the bottom with falling subs ? Where is it going to end? It seems that there has never been a better time to be a golfer interested in joining or moving club. But is it sustainable?

Clubs are scrambling around with various incentives, offers, etc to attract members. So presumably the total number of paying members is decreasing, hence the efforts for new recruits to replace leavers. If income is down in all clubs as a result, what will be the consequences : falling course standards, some going bust altogether, mergers?

Most clubs are not commercial ventures and plough all income back into the facilities rather than paying a dividend. So reduced profitability is not where the hit will be. Clubs will have to cut back expenditure, and even if they do they may not be able to maintain even essential expenditure if income falls dramatically.

Have we a bidding war going on that is going to lead to heavy casualties - rather than annual subs being maintained that really reflect the costs of running a club?

Sorry for the ramble -just thinking through they keyboard really......

soundsham

As a lot of A.G.M.'s are on around now, would it be and idea to post here(or start a new thread mods if ye like) what your club has proposed or agreed to do as regards yearly subs.....

It might be helpful to know what other clubs are doing......
personally I believe somewhere around 10-15% cuts are in order

Trampas

I think clubs need to think about dropping their annual subs by 10% - 20%

Lets say the average annual sub is €1000 a lot of people are going to be reluctant to pay it the way things are.

People might cancel/suspend their membership next year because they just don't have the cash and play the odd game and might join back the following year or 2 because they don't have to worry about joining fees.

Golf clubs really need to get their thinking caps on to keep membership numbers up.

GreeBo

I dont think its possible to drop a lot of them much further without making some serious cuts in expenditure. Any clubs that have fancy facilities (new DunLaoghaire for example) I think are in for a lot of hurt. It takes a lot of money to maintain underground Buggy Car parks etc. I dont think regular subs can cover that.

My own sub is €2000 and I cant see it getting any lower, thats a bit of a drop from last year as some levies have expired.

I think Id rather pay the 2k and know what sort of club I have and what my access to it will be like. If subs go down then outings etc go up and Im loosing the ability to play on my course when I want.

I know for sure that there are lots of people who wont be in a position to pay their subs next year, but I think for the survival of the course/club these people will have to leave or accept a different membership category.

conman

what im happy to see is the entrance fee being reduced and / or dropped altogether, i think the entrance fee's are a shame..

I mean, i could afford to pay 1-2,000 per year to play, but to join up in the first place, no i wouldnt have a spare 5-10,000 to have the priviledge of joining.

Sandwich

Entrance fees were just another (arguably inequitable) source of revenue. Funding many of the course, clubhouse, renovation, driving range etc. developments clubs could afford over the last 10 years.
Or resulting in this income being redistributed as higher subs for the membership as a whole if the income level is to be maintained without entry fees.

soundsham

my point is on subs not entrance fee's
what i'd be inerested in is what clubs are willing to do for their loyal members
what happens for new members would be another days work,and a different argument

jimjo

As we all know Ireland during the boom years went mad. Golf clubs were no different, clubs spent silly amounts thinking they would never see a rainy day again. Sure why not go mad when you could charge €50 midweek and €75 at weekends for green fees at a below average golf club? Golf clubs were in heaven. New housing estates/ apartment blocks were springing up all over the place; again it was the same case with golf courses. Swanky clubhouses were built when not only were they not needed but no one could even drink in them as there in isolated areas, added of course to the strict drink driving laws.

I recently heard of a club spending £750,000 on a new clubhouse over 10 years ago and than recently building an extension, yes and extension to the new clubhouse, for well over €3,000,000. I’m sure people thought it was great business in the boom years, sure if we leave it any longer it might cost us €4,000,000. I even heard of a club that spent a crazy amount on a towel service (well in the thousands), when they bought their own towels and washed the towels themselves it cost less than a tenth of the price they were paying.

The point I’m getting at is golf courses like everything else were mad during the boom years, many courses charged too much not only for joining fee but also for annual memberships. Every household in the county has to scale down, people shopping in Lidi instead of Superquinn saving a few euro, golf courses are cutting down on green keeping staff and than the remaining staff are on reduced hours, I would imagine their shopping around for cheaper green keeping products. Houses/cars and general goods are coming down in price. So yes I feel annual sub’s like everything else in the county should be reduced, courses mightn’t be in the same nick as they were in previous years, but as many clubs will find come January a lot of members wont be able to renew their subscriptions cause of household down scaling or unemployment and that’s not including the new taxes which the government will implement when the budget comes out in December. Sorry if I’m going on and being too glum!

1967

The main problem with golf clubs now is that subs/memberships will be down, green fees will be way down so less money coming into the club it will have an effect on the upkeep of the course itself either by cutting back on workforce or maintenance of the course or in all probability both.

thegen

There will be good value to be had that is a given. Heard recently that one of the lifetime memberships to K Club which sold for 100,000 pounds was sold on for 36,000 euro. At my clubs subs thats 18 years. Is it good value?

Mister Sifter

thegen wrote: »

There will be good value to be had that is a given. Heard recently that one of the lifetime memberships to K Club which sold for 100,000 pounds was sold on for 36,000 euro. At my clubs subs thats 18 years. Is it good value?

To be fair though, anyone who has a spare 36k lying around for golf membership isn't exactly looking for 'good value'. I'd imagine they clearly have other ideas about what that membership will bring them. Paying 2k a year to join a South County or a Roganstown, while good enough for the vast majority of golfers and far better value, wouldn't cut the mustard.

'scorthy

Nice to see this thread on subs. I'd be in favour in the reduction of subs, in our situation by way of removing the bar levy, even though I'm going to spend the levied amount either way... but it's a gesture. A lot of members play and go.. that's there right. Clubs as stated earlier will need to be creative by giving VALUE. I take the holistic approach to the cost of golfing to me...round trip 40 mls, lunch, comp fee, interclub tournament travel add these to the yearly subs and golf is an expensive game! I get a yearly read out of what I spend at the club bar/restaurant and I dare not tell the wife.

(I would be against reduction in entrance fee for new applicants...some clubs didn't go mad and long standing members had to pay levies over the years to bring standards up to international levels. Why should newbies benefit from vastly reduced entrance fees in Country clubs trying to survive?)

Webbs

What are the equivalent subs at clubs in say the UK which would be the nearest comparison? I only ask as the Vale Hotel GCC in wales near to where I grew up has subs of around £800 for the lake course which I would imagine would compare very favourably with equivalent places here in Ireland

Kevinmarkham

Subs are the lifeblood of most clubs. I'm sure there will be some that cut the sub, but it will be minimal. As has been pointed out, the money is pumped back into the course to keep it in the condition that paying members expect.

I agree with Sandwich, that clubs will have to find innovative ways to improve what the annual sub delivers. My home club, Greystones, recently did a promotion with other local courses which allowed the clubs' members to play at any of the other courses for a heavily reduced rate.

Jimjo mentioned towels: a lot of clubs provide these for free and it costs a good 10K to maintain them. Not a huge amount, but covers a large chunk of a greenkeeper's wage - and which is more important.

From what I've heard, the main concern of clubs is the members who will take a year off on 'sick leave'. I was at a bash two weeks ago and met a guy who pays his annual sub without fail, but hasn't played golf in six years. Nowadays, most of us can't justify that and there's nothing a club can do to entice him to keep paying - other than giving him that year's sick leave.

If anyone has a brainwave on how to keep subs at their current level and keep members happy at the same time, I suggest you sell the idea to your club!

jimjo

Webbs wrote: »

What are the equivalent subs at clubs in say the UK which would be the nearest comparison? I only ask as the Vale Hotel GCC in wales near to where I grew up has subs of around £800 for the lake course which I would imagine would compare very favourably with equivalent places here in Ireland

Well as you say Welsh none better to look at than the Celtic Manor. Did a little search and found this membership option

http://www.celtic-manor.com/Membership_Golf.aspx

As sterling is at a good rate at the moment it comes to just under €1,200 which for two courses (they must be half decent) is great value.

GreeBo

'scorthy wrote: »

A lot of members play and go.. that's there right.

I disagree with this bit to be honest.
Its your club. If you are not going to support it then you cannot complain if the prices go up or it goes under.
There isnt some guy in an office rubbing his hands together watching the money roll in. There is a manager who you all pay to run your club.

(Obviously Im talking about member clubs here, but thats the majority in my experience)

rafared

Most culbs are feeling the pinch. I cant be too specific but my home club lost 43 full male members this year.....ie 43 men did not renew their subscription for the 09 season. Our sub has remained the same for the last 3 years at 750E. The problem now faced by the committee is whether or not to raise the sub to compensate for the loss in revenue or leave it as is.
Our green keeping staff have also been reduced to a 3 day week which has had an obvious effect on the condition of the course.
There is also massive competition amoung clubs now for new members.
The big, famous courses around me who were charging 16,000 to join, are now faced with the prospect of having to take on new members at vastly reduced rates. The feeling at our meetings is that many clubs will scrap the entrance fees altogether with new members paying only the sub.
It is also possible that many clubs may go Pay-and-Play in an effort to keep themselves afloat.
The upside of this is that prospective members will have a chance to join clubs that otherwise would be impossible.
I have a couple of friends who are seriously thinking of joining a club as a country member, paying the 200E cost, and then playing casual green fee golf. If your sub is 1000E that would leave you with 800E to spend playing different courses. With the cost of green fees on the floor I can understand why they might do this.

Sandwich

'scorthy wrote: »

A lot of members play and go.. that's there right.

GreeBo wrote: »

I disagree with this bit to be honest.
Its your club. If you are not going to support it then you cannot complain if the prices go up or it goes under.
(Obviously Im talking about member clubs here, but thats the majority in my experience)

Agree with Scorthy, disagree with Greebo. Removing bar levies is a good way to go and reduce the headline cost of the annual bill, or for people to cut the cost of their golfing 'package' (sub, travel, competition fees). Something is going to have to give unfortunately, and I dont think its fair to suggest people are not supporting their club by not using the clubhouse facilities. Id prefer it were bar/food/towel services etc before we notice the cutbacks in the facility we are there in the first place to use : the course.

GreeBo

Sandwich wrote: »

Id prefer it were bar/food/towel services etc before we notice the cutbacks in the facility we are there in the first place to use : the course.

The course wont exist without visitors and you wont get greenfees and outings if you dont have some sort of bar/restaurant for them afterwards. Towels possibly, but competition to attract visitors is only going to get fiercer. Lowering your standards wont attract more people.

The bar & catering companies are paid retainers to make up for the quiet times, if all the times are quiet times then they will leave and there goes your club...

Webbs

I think there is a case for substantial reductions in the subs to entice members firstly to stay and secondly to get more people to play. I guess its the same old argument that is going round about something like VAT in that decreasing a rate may actually bring in more money.
I personally think >1000e a year the course has to be amazing championship quality as I mentioned in an earlier post there is a large gulf in subs between comparable courses here and the uk, Ireland being overpriced I would say in the 25-30% region. If courses in the UK can maintain high playing conditions with their subs surely Ireland can do the same

Unglika Norse

For Members Clubs, members need to attend AGMs and ascertain what the total running costs of the club are projected to be in the coming year (it’s no good sitting on your hands and then crib and cry about the decisions that have been made, have the courage to stand up and speak).

This should of course take in a carefully planned course maintenance programme to ensure no loss of standards, and other costs such as bar staff clubhouse running cost and all other ancillary costs associated with the actual funding of the club which will include some of these dreaded loan repayments., members must have their input into what facilities they would like to retain and those they would like to see gone, bear in mind that at most AGMs committees only deal or in the main deal with the past years expenditure, so motions may need to be put down to get forecast budgets.

If the figure to run the club for the coming year is €650,000.00 and the club has 700 full fee paying members the annual sub should be in or around €929 per annum. This obviously is dependent on how many members actually pay their subs and do not take leave of absences or give up memberships, etc

Members must be in a position to fund their own club without the need for green fees which should be considered bonus income to be used for course/club improvements and not dependant on. It will be the choice of the AGM as to whether or not entrance fees should be charged to meet any possible short funding. It is not unreasonable for members clubs to retain an entrance fee as the club has been built up over many years by existing members paying such and also levies and it will be up to the members of the club as to whether or not the club continues in whatever shape or form It is also not unreasonable to have bar/food levies as this is for the common good whether you choose to use the facility or not it needs to be provided even in basic form.

This in essence was Sandwich original post, annual subs must reflect the running costs of the club

Propriety owned clubs are a different matter and these courses will set their own budgets and determine their own requirements and the profit or loss level they are prepared to continue at.
Although players are “members” of this type of club they very rarely have any say in what the subscription is going to be or what entrance fees can or should be charged it has not been unusual for such a club to have very high fees possibly done on share options which are now virtually worthless and cannot be sold, in some cases such clubs may and could have blocked the sale of such shares.
This type of membership in the main is a marriage of convenience whereby for a fee charged per head by the owner, a club under license has the use of the course and gives the course credibility by becoming affiliated. The club has only to worry itself with the running of club and inter club competitions therefore their own funding requirements would be quite minimal with all or most of the annual subscriptions going to the owner of the course.

It is my opinion that these are the clubs that are most vulnerable in the current climate as they cannot count on the membership to help any self inflicted costs if fees are unreasonable members will look at other options and if their courses are not maintained to the highest of standards green fee revenue will begin to diminish drastically.

They also will have less of, but not always, a loyalty to the personnel who use their course it will simply be a matter of economics as illustrated by the closing for economical reasons for the closure of Luttrelstown due at the end of the year.

Again to go back to sandwich if golf clubs are to survive they must become more efficient and reduce costs and charge what they need to make the club run, not just a figure pulled out of the air.

Mister Sifter

Interesting to note in the leinster branch of the GUI accounts that the number of golfers affiliated to Leinster's golf clubs in 2009 was 75,000 - a drop of 1,000 on 2008.

I thought it would have been more. Although i'm not sure how it works in terms of players taking a year off from paying subs. Something runs in my head thta they still pay their €6 GUI fee?

GreeBo

Webbs wrote: »

I think there is a case for substantial reductions in the subs to entice members firstly to stay and secondly to get more people to play. I guess its the same old argument that is going round about something like VAT in that decreasing a rate may actually bring in more money.

The problem I see with this argument is that we are dealing with a finite resource. ie. Tee Time.
You cant reduce the sub to €500 and then expect to get 2000 members. They will all be gone by next year once they realise they can rarely get on the time sheet.


The options (as I see them) are to reduce the subs and accept the corresponding drop in standards; open the course up to more visitors and accept the corresponding drop in members playing rights or accept that if you want the standards and availability that you are used to then you have to pay for it...

Webbs

GreeBo wrote: »

The problem I see with this argument is that we are dealing with a finite resource. ie. Tee Time.
You cant reduce the sub to €500 and then expect to get 2000 members. They will all be gone by next year once they realise they can rarely get on the time sheet.


The options (as I see them) are to reduce the subs and accept the corresponding drop in standards; open the course up to more visitors and accept the corresponding drop in members playing rights or accept that if you want the standards and availability that you are used to then you have to pay for it...

I see your point although I am sure a lot of clubs will have spare spaces without putting too much pressure on Tee times. While clubs in the UK are going through the same problems how do they manage to have lower membership fees and maintain courses to the same standard?

scout353

'scorthy wrote: »

Nice to see this thread on subs. I'd be in favour in the reduction of subs, in our situation by way of removing the bar levy, even though I'm going to spend the levied amount either way... but it's a gesture. [bold]A lot of members play and go.. that's there right.[/B] Clubs as stated earlier will need to be creative by giving VALUE. I take the holistic approach to the cost of golfing to me...round trip 40 mls, lunch, comp fee, interclub tournament travel add these to the yearly subs and golf is an expensive game! I get a yearly read out of what I spend at the club bar/restaurant and I dare not tell the wife.

I think it is not right for members to just arrive, play golf and disappear. You join a club, not pay a fee to allow you to play golf on a course. You have the resources available to you - lockerroom, showers, toilets, etc. And you are a club member so you should row in behind what the club is trying to do! Even a cup of coffee after a round shows your commitment to your club.

I always, where possible, head to the bar after a round and even if its just a coffee, I will have it because I am a member of the club!

(I would be against reduction in entrance fee for new applicants...some clubs didn't go mad and long standing members had to pay levies over the years to bring standards up to international levels. Why should newbies benefit from vastly reduced entrance fees in Country clubs trying to survive?)

Have to agree with you there!

Sandwich

scout353 wrote: »

Have to agree with you there!

Therein lies the original question. While you might not like reducing entry fees to recognise what other members have put into a club over the years, the reality is that due to market forces, many clubs have reduced them or removed them completely. Which makes those still charging them all the less likely to attract members. (OK for the elite Portmarnocks or Elm Parks who still have waiting lists, but they're a tiny proportion of irish clubs). And so more likely to suffer from the lack of subs income because they cling to the entry fee principal - and so lose income on the double. This is the dynamic that is playing out at the moment. Some clubs scrambling to survive, others, either not awake to the changed market, or able to continue as they were in the short term due to existing strong finances.

We have two constraining forces :
- too many clubs chasing too few golfers
- too many clubs/golfers with inflated ideas of the standard of golf they should provide/get for a given subscription

(Similar to the traumatic adjustment Ireland is going through with taxes/public services.....but that another story)

steph1

I agree with many of the posters on here and their comments. I play on a course in the West of Ireland which this last year has seen a dramatic drop in visitors and green fees.
The one thing that clubs must not cut back on is the course and its condition. After all thats what people come to the club first and foremost for is to play golf. If the course is not maintained properly people just wont come back again. Clubs in rural areas while they may have a lot of local membership do depend on green fees and open days to keep going.

tommyfitz

jimjo wrote: »

As we all know Ireland during the boom years went mad. Golf clubs were no different, clubs spent silly amounts thinking they would never see a rainy day again. Sure why not go mad when you could charge €50 midweek and €75 at weekends for green fees at a below average golf club? Golf clubs were in heaven. New housing estates/ apartment blocks were springing up all over the place; again it was the same case with golf courses. Swanky clubhouses were built when not only were they not needed but no one could even drink in them as there in isolated areas, added of course to the strict drink driving laws.

I recently heard of a club spending £750,000 on a new clubhouse over 10 years ago and than recently building an extension, yes and extension to the new clubhouse, for well over €3,000,000. I’m sure people thought it was great business in the boom years, sure if we leave it any longer it might cost us €4,000,000. I even heard of a club that spent a crazy amount on a towel service (well in the thousands), when they bought their own towels and washed the towels themselves it cost less than a tenth of the price they were paying.

The point I’m getting at is golf courses like everything else were mad during the boom years, many courses charged too much not only for joining fee but also for annual memberships. Every household in the county has to scale down, people shopping in Lidi instead of Superquinn saving a few euro, golf courses are cutting down on green keeping staff and than the remaining staff are on reduced hours, I would imagine their shopping around for cheaper green keeping products. Houses/cars and general goods are coming down in price. So yes I feel annual sub’s like everything else in the county should be reduced, courses mightn’t be in the same nick as they were in previous years, but as many clubs will find come January a lot of members wont be able to renew their subscriptions cause of household down scaling or unemployment and that’s not including the new taxes which the government will implement when the budget comes out in December. Sorry if I’m going on and being too glum!

I think you may be talking about my home course in Co Meath. Some so-called know it-all people who should have known better pushed this new club house to be built and most members couldnt be bothered voting against this lunacy. Recently an EGM was called to suggest reducing entrance fee from 10k to 3k. A new member, a well known RTE Presenter led the group against this motion. The Club were supposed to have had about 140 people interested in joining at 3k.
Eventually it was agreed to put entrance fee at 5k.
I think about 15 new members joined. Some people didnt want new members getting in cheap, but now club are short 100 new members that are needed to pay back huge loans.
Members subs will have to go up now to get much needed revenue.

jimjo

tommyfitz wrote: »

I think you may be talking about my home course in Co Meath. Some so-called know it-all people who should have known better pushed this new club house to be built and most members couldnt be bothered voting against this lunacy. Recently an EGM was called to suggest reducing entrance fee from 10k to 3k. A new member, a well known RTE Presenter led the group against this motion. The Club were supposed to have had about 140 people interested in joining at 3k.
Eventually it was agreed to put entrance fee at 5k.
I think about 15 new members joined. Some people didnt want new members getting in cheap, but now club are short 100 new members that are needed to pay back huge loans.
Members subs will have to go up now to get much needed revenue.

Yeah thats the course I was talking about. It was actually an old committee member who told me the whole story, I thought being an established member serving on the committee for a number of years he would be against dropping the entrance fee and letting more members in, but to my amazement he was quite the opposite (I suppose I had this stereotypical impression of an old member with hard line views).His main gripe was the clubhouse and the main group behind it.
Not sure what to say about the lack of new members, however I do feel that not all people on the waiting list would have been serious about paying over the cash and joining. I even thought for a brief moment to put my name down, but realistically it would have never been visible. I fear to make up for this the club (cause they have to repay the loan for the clubhouse) will go out life and limb to attract green fees and have more open days (great for me!) but this would affect member’s ability to book tee times.

I play your course a number of times a year and really enjoy it (in fact I played in the majority of opens they had this year); I just hope it won’t be neglected as there’s a lot of land to maintain.

thoscon

tommyfitz wrote: »

I think you may be talking about my home course in Co Meath. Some so-called know it-all people who should have known better pushed this new club house to be built and most members couldnt be bothered voting against this lunacy. Recently an EGM was called to suggest reducing entrance fee from 10k to 3k. A new member, a well known RTE Presenter led the group against this motion. The Club were supposed to have had about 140 people interested in joining at 3k.
Eventually it was agreed to put entrance fee at 5k.
I think about 15 new members joined. Some people didnt want new members getting in cheap, but now club are short 100 new members that are needed to pay back huge loans.
Members subs will have to go up now to get much needed revenue.

i was interested in joining and and im on a list of people to ring when they nearly have their quota of new members.is it likely to go down to 3k ?

tommyfitz

thoscon wrote: »

i was interested in joining and and im on a list of people to ring when they nearly have their quota of new members.is it likely to go down to 3k ?

As far as I know you can join at the moment for 5k. AGM is next month. It should be interesting.