Fall 2014 www.GolfIncMagazine.com 13
in Edgmont, Pa., did so in 2013. It took
out a $2.2 million loan from PNC Bank in
2005. It still owed $1.5 million on it at the
time of the filing.
“It was just a defensive move we felt we
had to do to protect the property,” club
Chief Financial Officer Peter Mariani told
the Delaware County News Network.
It’s not an uncommon story. And it’s
one tough hole — to dig out of.
This hole might play the easiest on the
course, and that’s because operators have
a few things going for them:
Low interest rates, willing lenders and
dropping demand, experts said.
“There are more finance companies
than ever fighting for your business,”
said Bill Loots, of EverBank Commercial
Finance. “They are offering better rates
and delivering better service.”
Plus, the products are of higher quality.
Courses can also look at leasing equipment, said Paul Mueller, senior analyst
for Club Capital Planners. That offers a
number of advantages, he said, including getting new equipment with the latest technology every four years. Plus,
courses have a stable lease payment via
“This has the potential to mitigate the
difficult peak expenditure years,” he said.
Rhonda Flanery of John Deere Financial
said industry lease rates have remained
stable for the last several years, compared
to during the recession, when “they were
all over the board.”
The company has a long history of
working with operators to make the finan-
AND IT COSTS
Length: 399 yards
Golf courses seem to be laying up on this
hole. And that might not be the best way
to play it, according to Cronin. He thinks
courses should muscle up to the tee and
blast that sucker.
Right now, clubs that invest the most
in IT commit 0.75 percent to 1 percent of
revenue, he said. Half of the nation’s clubs
spend less than 0.5 percent. He notes that-Dell estimates that corporations in the
larger economy spend 3. 5 percent of revenue on IT.
He said the golf industry is behind the
curve and should view technology as an
investment and not an expense.
Joel Ragar, CEO at ForeUp Golf, a software company, agreed with Cronin.
“Software shouldn’t be viewed as a sim-
ple operational expense,” he said. “It needs
to be viewed as an investment, and as a
tool, used to generate more cash flows on
your bottom line.”
He said software can help courses
record and collect each customer that
walks through the door, and remarket to
those customers for increased repeat play.
Good software also produces sales analytics that help a course understand what
sells and what doesn’t sell in the pro shop;
and which products produce the best
cials work as seamlessly as possible, she
said. She agrees this is a par 3.
“Our motivation is to get you the equipment you need,” she said.
Somebody has to crunch all the numbers, and that’s more important than ever,
given the financial pressures on courses.
The days of a modest bookkeeper handling such duties are mostly over. An
18-hole, full-service club can have annual
accounting costs and overhead exceeding $100,000, according to EHC Certified
Public Accountants, based in Kansas City.
But some courses are not taking advan-
tage of all the available expertise, noted
the firm McGladrey, which advises pri-
vate clubs. In its 2013 “Florida Trends in
Private Clubs” report, it noted: “Too many
clubs do not allow, let alone require, senior
accounting executives to attend board
meetings. In corporate America, most
CEOs would refuse to enter a boardroom
without their chief accounting employee
at their side.”
Now, with more clubs seeking to run
like businesses, hiring financial profes-
sionals can be key, McGladrey said.
“Cutting corners with internal financial
advisors, at a time when members and
leadership are demanding more financial
accountability and knowledge than ever,
can be dangerous,” the report said.