Golf is a great sport. It is also a lucrative business to the entrepreneurs or businesses who operate the golf courses. Understanding how golf courses operate is important. If you are curious, you must be wondering; how do golf courses make money?
As a golfer and an entrepreneur, i have always wanted to understand how golf courses make money or generate their income.
This curiosity has made me research and seek information on how the golf course business is run or managed.
As you are aware, every business seeks to generate income and make a profit from the operations. These principles apply to the business of golf courses.
When investors decide to put their money on a golf course, they do expect a positive return on their investments.
This means that a golf course should create or design ways in which to make money.
In this article, I am going to share with you the various ways that a golf course uses to make money.
Some will be ideas you might already suspect, and others might be ways that are new to you.
If you are interested in investing in building or owning golf courses, then this is a resource you should read.
How Do Golf Courses Make Money?
Golf courses makes money in a number of ways and that includes the following;
- Membership fees
- Green fees
- Pro-shop sales
- Golf tournaments
- Online business
- Golf simulators
It is important for a golf course to find ways to generate income and turn a profit.
This requires the visionary leadership from the management or leadership team of a golf course.
A golf course can make money and be profitable.
9 Ways in Which Golf Courses Make Money
Playing golf is always exciting.
Golf courses as a business are equally interesting. You need to be focused to ensure the course generates income, and can be profitable.
In today’s world, the management of a golf golf course should think outside the box for ways to make money
So, how does a golf course make money today?
There are several ways in which a golf course can generate revenues, and include the following;
To join a golf club, you are required to pay certain amount of money as your membership fees.
Membership fees are one of the ways golf courses make money.
This money is paid by anyone interested in joining or being part of a particular golf course.
You can pay hundreds or thousands of dollars to become a golf club member. Some membership fees run into millions of dollars for the high-end or most prestigious golf clubs in the world.
For a golf course to make money, one of the tools they use is charging of the green fees.
In simple terms, a green fee is the amount of money you pay to play at a certain golf course.
One can say it is the actual cost of playing a round of golf on a 9-hole or 18-hole golf course.
Given that many people play golf over the course of an year, green fees adds up being a significant source of revenue for a golf course.
In almost every golf club or course you go to, you will find a pro shop.
This is a shop that stocks golf-related merchandise, equipment and golf accessories.
You can buy golf bags, golf clubs, caps, balls and other golf accessories from the pro shop.
The income generated from the sales of these things adds to the gross revenue of the golf course.
Whenever I host a golf tournament, I buy give-away prizes at the pro shops. That is a clear demonstration of the income-generating power of a pro shop within a golf course.
As you can see, a pro shop is an important part of the money-making golf course.
When it comes to hospitality at a golf course, this involves foods and beverages.
It is one of the areas that generate revenue for a golf course.
Food and drinks served are always charged. The income from the hospitality division of a golf course comes from members and non-members too.
Sometimes, non-members can hire golf grounds for events or functions at a fee. In most cases, food and beverages will be supplied by the golf club.
This helps the golf course to generate income and make extra money.
Golf clubs have created programs or packages they promote to corporate organizations.
The idea is for brand or companies to become sponsors of certain events at a golf club.
Sponsorship are a smart way for a golf course to make money, while providing value to the various sponsors.
For example, a golf course can secure a club night sponsorship from a company for an agreed amount.
As you can see, the sponsorship adds to the money a golf course makes per year.
One of the major ways a golf course makes money is by hosting golf tournaments.
These could be local tournaments or the major golf tournaments like Masters, LPGA or PGA tours.
A golf course is paid some money to host the tournament.
To a golf course, hosting a golf tournament is another way of making money.
As technology improves, golf courses are also adopting modern ways to make money by leveraging the internet.
Online business is on the rise.
Some golf courses are using online platforms to create e-commerce sites, blogging sites and YouTube channels.
When monetized, these platforms can generate extra income for the golf course through content marketing.
Golf courses have one thing in common; a vast land space.
To some, this is just a vast piece of real estate. However, it presents a big opportunity for a forward-looking leadership of a golf club.
With that real estate, it means the golf course can lease out some of it to outdoor advertising agencies to put up billboards.
This would be another way for the golf course to generate or make money without interfering with golfing activities.
This is a unique way for a golf course to make money from hiring out golf simulation space.
Golf simulators can be very expensive. This is true of the high-end models.
Many golfers do not have golf simulators at home.
However, some golf courses have invested in golf simulators, turning them into income-generating assets.
They will allow you to use the golf simulator at a fee.
In conclusion, running a business is not easy. You can make money and you can also lose money.
To a person who does not own a golf course business, walking into well-manicured golf lawns is relaxing.
However, golf business can lead to financial difficulties to the entrepreneur or business person behind the golf course.
To run a successful golf course is challenging. You must understand your financial numbers. This ensures you are generating enough revenues, while being tight on your expenses.
It is the only way you can generate a profit from your golf course business. Today, there are people who question whether golf courses are still profitable.
Like other businesses, golf courses usually have multiple streams of income. They generate money from multiple sources which include membership fees, green fees, sales from pro shop and sales generated from provision of hospitality services.
Take time to understand the business model of a golf course. Doing that will help you learn how golf courses make their money.