Golf clubs feel the pinch

The economic downturn is being felt on the golf course. While 3% more rounds of golf were played in South Africa last year, membership of golf clubs has been dwindling over the past three years.

It has become routine to see discounts of up to 60% being offered for rounds of golf at certain courses. Many of these bargains can be found on websites such as flook.co.za and lastminutegolf.co.za.

According to Handicaps Network Africa, the official supplier of the SA Golf Association’s handicap indexes, 3.91 million rounds of golf were played in South Africa last year – up 3% from 2018. And, according to Chris van der Merwe, chairperson of the Club Management Association of Southern Africa (Cmasa) and general manager of Stellenbosch Golf Club, this means that just over 10 700 registered rounds of golf are played every day of the year.

However, figures from Stellenbosch Golf Club show that at least 20% of golf rounds are not registered (players without an official handicap).

Extrapolating these figures, it means that roughly 13 000 rounds of gold are played every day, he says.

Van der Merwe says golf clubs are running more special offers and discounts than they did five years ago, partly because of the beleaguered economy – but a club’s fixed costs remain the same. He says golf clubs that are not associated with a particular course are flourishing, and clubs will have to adapt to the new environment to attract players.

Statistics from Golf SA show that the total number of registered golf players with a handicap has been in decline since 2017. At that point, there were 138 528 registered players. In 2018, there were just more than 13 100 registered players, and last year there were 130 982 (of whom 12% were women).

You only qualify to be a registered golfer with a handicap if you are a member of a club.

City Press’ sister publication, Rapport, has learnt that many players in cities are now registering themselves with rural clubs because membership is much cheaper. This way, they are able to get their handicap while still playing at the club where they would ordinarily play.

Ivano Ficalbi, CEO of the Professional Golfers’ Association of SA, says discounts are usually available at quiet times as it is still better to have a few players on the course at a lower price than having no players at all.

Francois Swart, part of Cmasa’s management team and the CEO of Randpark Golf Club in Johannesburg, says discounts are only a short-term solution, not a sustainable business strategy.

He says fewer golf days are taking place because of the economic squeeze. Hence, golf clubs worldwide are changing their approach and trying to market the club as a destination with added value for the whole family.

The big challenge with this lies in attracting nonplayers to become members.

Aside from the ailing economy, safety concerns, emigration and fewer tourists, says Van der Merwe, misconceptions about environmental impact and the poor exchange rate are also challenges for golf clubs.

In a survey conducted by Cmasa in October, in which 44 clubs participated, 37% of respondents said their operating costs had increased over the past three years, while 42% said the increases were in line with inflation.

Van der Merwe says 8% of respondents indicated that their operating income had increased markedly, while 69% said the increase was inflation-related. A further 12% said they had seen no growth or had experienced a decline.

The survey showed that sport and recreation clubs spent, on average, 14% of their total annual income on capital projects and equipment; and 37% of their income went on personnel expenses. It also found that clubs employed, on average, 61 people, of whom 55 were full-time employees.

Swart says the specialised equipment needed to maintain a golf course is also a significant expense as it has to be imported. A lawnmower for the rough costs about R1.3 million, while a lawnmower that is pushed and used on the greens costs about R144 000. The latter needs to be replaced every four years.

Randpark has 12 such lawnmowers. Without them, the course cannot be properly maintained in the limited time available for maintenance – no interference in playing time is allowed.

According to Swart, overseas clubs have started offering flexible membership packages. These include packages that give social members access to lifestyle activities, packages aimed at junior players over six years old and at students, and practice packages.

Restaurant facilities are also becoming increasingly important. Swart says many clubs today earn just as much income from food and beverages as they do from golf course fees.

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