the PROS and CONS thread got me thinking (and spreadsheeting) ...


if a course costs $300K to create, it will take a community of 1,300 golfers who are willing to pay $20 three times each year for the next five years to make course even somewhat interesting from a five year financial perspective. the assumptions are:
<ul type="square"> 12% cost of capital/opportunity cost
cash flow = 25% of revenues
open 9 months
100 rounds every week from week 1
growth 1%,5%,10%,10% in years 2,3,4,5 respectively
[/list]

in other words, dont hold your breath. if we have 20 metro areas capable of sustaining a committed player base of 1,300 players, we need 26,000 relatively hardcore players to have a national presence.

at the opposite end of the spectrum, a super exclusive facility that charges $500 per round could allow 12 rounds per month and need a player base of only 48 players (thats 960 nationwide). even the middle ground is tricky.. at $50 per round you need a player base of 650 per course to escape alive. thats the size of a typical disc golf region not city ... so we are thinking at least one geographical unit ahead of ourselves.

how's it have anything to do with the environment? Tragedy of the Commons (http://en.wikipedia.org/wiki/Tragedy_of_the_commons) (i know its wiki, but still this article is okay).

if disc golf can survive to the point where we have 30,000 committed players, it just might reach a point where pay to play courses can effectively reduce the net damage caused by playing our public courses.

until then, all we have is our own efforts to protect the land our courses use.

ok Pat.... I don't know what direction you want to go with this thread.... but here's something to chew on:

factor this using a country club style approach. Dues can't be too high, but I think $100-200/yr is feasible for an exclusive course (or courses). throw in revenues from some $15-25 per-round fees (non-members) and another X dollars from merch sales... what would it take to make that work?

i dont know where i am going with it either. i guess i got started by wondering how the sport might minimize any negative environmental impact. after that it was a realization that in a free use situation, environmental degradation is almost an inevitable consequence of growth in popularity. contrast some of the really good courses introduced within the last 10 years by comparing their condition to when they debuted. even the ones that are holding up the very best show some minor signs of wear.

an environmental program to protect against those changes costs money or takes a bunch of insanely organized and motivated volunteers and even then its no sure thing. so i was wondering about the feasability of a private, or fee-based public, operation designed to protect the environmental appeal of the sport.

anyway, i can run those numbers you suggested, i think... the country club approach makes sense (but we oughta keep the other one on its own merit and see how it compares)... would "membership" get you anything that could not be funded from operating costs or could not be included in a $300,000 startup budget? if you're talking buildings and stuff that adds some bigger dollars quickly.

anyway, i assumed membership was not a startup cost...

if you augmented an active player base (3 rounds at the course per year) of 1300 paying $20/round with 100 members at 100 per membership you would be in decent financial territory.

i found a breakeven at $10/round for non members, 100 rounds per week for nine months, plus 350 memberships at 100 per membership. you might be able to set up such a facility in a major metro area, but you'd be need some help with the land costs being that close to a population center. if the countryclub environment provided enough of a value that you could raise the non member fees, you would look really good at $20/round and pretty phenomenal at $50/round.

at $20/round you could afford to put $40K per year into course care and maintenance. at $50/round and a $200 membership you could invest $180,000, or 18K/hole, per year on custom environmental protection or course development/management. that could actually be a pretty nifty course. its just the amount of members and size of the player base that bug me.

Dual purpose facility , makes more profit.Hence pizza hut, and taco bell ,in the same building.Both can exsit by themselfes ,but why.Golf courses are prepared daily for the players we get the benefits.Most metro golf courses are debt free after being in the ground for 40 years plus.For a sponsor a golf course is a perfect venue.When i sell a course, the return on investment is under 12 months...In the business world that is awsome.I had a slow year putting in courses with only 1 in Riverside ca par 71 12,640 ft.I have 2 in the springtime 07...Even though snowboarding makes up 75 % of sales in ca maybe higher.They have still not built one, just for snowboarders???How about ski resorts with disc golf on them, who paid for the chairlift and the bar?Follow success, and success will follow.Fly 18, building the future of our sport.Vision Purpose ;)

I refuse to believe that the future of our sport is in 12,000+ foot courses...

Anyway, the dual-purpose thing has some merit, but it's hard to go that route if you're installing a course on a previously undeveloped piece of land. I think adding something like a batting cage or a mini golf course (or both) to the facility could drive in traffic, but I'm not sure what else could coexist there (again on a new tract). If this piece of land was actually inhabited by its owner, the possibilities change quite a bit. It actually sounds like a great retirement plan... buy up about 75 acres of wooded land, clear about 5 of it and build your house and maybe a pro-shop... wait... this is starting to sound like Circle R ranch.

fly 18 follows the par of the course.Riverside is my largest course most of my other courses are ex courses..... ;)

Here's a couple of examples from recent experience. Food for thought:

Public course - Just put in a public course on County-owned land. Granted, the land was donated 20 years ago or more by the Federal Gov't., so that skews the figures. Nonetheless, the total package - concrete tees, Chainstar baskets, top notch signs, benches, trash cans - came in at around $30,000. Use fees for the course are $3 per day and $25 for an annual pass. I was told last week they are doing about $100 per day (only open on Fri., Sat., Sun during winter) and they expect $200 per day when open daily in the warm months.

Private course - Also just finished a private course for a close friend. Land was @ $175,000 for 22 acres. Chainstar baskets @ $5,500 or so. Z-Mower, another $5,500. Various landscaping and course building tools @ $1,000. No tee pads or signs. VERY private course with only about 4 members and no plans to invite others or hold tournaments.

Just throwing some figures out there for thought. From my experience, I can easily see that a course with pads, signs, and clubhouse, in addition to the baskets and land acquisition costs, could run $300K.

good numbers, Mike, thanks. flyboy also. multiuse is certainly an option. as long as it is pay for play there is a chance the environmental impacts can be lessened by reinvesting revenues.

the land cost really puts a crimp in things. close to poulation centers it becomes prohibitively high for the numbers of players we have... going farther out means cheaper land but reduced attraction cuz of the distance.

BBD, what do you think about the numbers from the country club model you suggested?

Pat, I can answer from the other side of the table. As a player, I would be willing to pay to play for a well-maintained, well-designed course. I think I would prefer the country club style of membership. That is a yearly membership fee (say $250) and a nominal greens fee (say $5/round) and a charge of $40-50 per round for a non-member.

I don't know that I can count myself as the prototypical golfer for this scenario, but I would imagine that over the course of a year, I would likely average playing once a week on the course, thus generating $500 a year from my membership.

Perhaps there could be some sort of added incentive for members only to encourage membership, like members-only priority tee times on weekends. (Or Members Only jackets for members :D)

i still have a Members Only windbreaker from the 80's in my closet :)

thanks for the input. until BBD suggested it, i had not thought of a CC style membership approach. but it appears to be a solid idea.

Amen to the country club model for a disc golf course. I am so sick of going to public courses and seeing trash on the ground with trash cans in sight. People who would belong to such a country club would hopefully have a sense of "ownership" and thus be reluctant to litter.

One of the thoughts behind charging to play at the public course I just completed was that it would reduce the number of littering riff-raff playing the course. It was hypothesized that people who litter are less likely to pay for a round of disc golf. It seems that so far, the cost and the length of the course (6,950') have kept the majority of the littering public away.

well, I think $20/round might be a bit high, although $200/yr sounds feasible. Perhaps $20/day is more in line with what DGers will pay. Regardless, charging more than $5 or so is going to require a nicer facility and a longer ROI.

What if you altered the country club idea to include a ramp-up period? Spend your initial money installing the course and sell inexpensive rounds and memberships at first. Guarantee something like a 3-year rate guarantee for members with limits on how much the rate can increase thereafter. that way you get feedback on the course, fairway improvement via foot traffic, and word of mouth about your course before any real investment begins. Once you're somewhat established and have a small revenue stream, move forward with improvements like a clubhouse, restrooms, nicer teesigns, alternate pins / pads, etc. Since people already know that your course exists, word will spread about the improvements.

i really think it's more a matter of marketing than anything else. properly marketed (and of course well-designed), I think just about any pay-to-play course can be successful. You just have to keep yourself ahead of the curve, investment-wise.

Imagine a fee structure like this:
members can bring in one guest for free every month and are guaranteed 3 years at the rate they purchase, with no more than a $50 increase per year thereafter (of course they would never pay more than the going rate). Membership includes access to the course's website which contains progress reports, member lists, forums, current pin placements, hot rounds, downloadable scorecards and course maps, etc. etc.

Stage 1
raw course, no improvements
$100/yr, $5/day

Stage 2
teesigns, trashcans, maybe a few porta-pots
$150/yr, $5/round, $10/day

Stage 3
concrete teepads, alternate tees, alternate pins
$200/yr, $10/round, $15/day

Stage 4
clubhouse, real restrooms, pro shop, etc. Start the second course (if you have room)
$250/yr $15/round, $25/day

This is all just a rough guess, but I think it could work. Marketing handles itself and the offset of startup costs helps pay for improvements. Now I just need to find a piece of land ;)

those are all good ideas, but do not address the question of whether or not a metro area can support the number of rounds by nonmember and the number of members paying membership fees , regardless of how awesome the course is.

you are also adding labor costs - pro shop, clubhouse, restrooms... i doubt that you can build all of that for $300K unless you get free land.

if we define an active player as someone who playes 3-4 times a year in a competitive or sanctioned weekend event, the player base does not seem to be there.

I think the privately owned club is the way to go in terms of private facilities, but I think most of the financial scenarios suggested here are somewhat off the mark. Missing are the membership fees, the large chunk you shell out to join and thus "own" a portion of the facility. With time, the value of a membership should rise, so later arriving members don't ride for free. Since there are limited numbers of spots, a wait-list for membership might develop just as at the ritzy cc's. The initial large chunk of change from the first group of members could leverage a note for some land and facilities. However, the costs are prohibitive in areas where there are lots of players, and in places where land is relatively cheap, there's not enough player base to support the idea.

The only numbers I've found to work involve a sugar-daddy with huge acreage who will lease the land for $1 per year. Otherwise, disc golfers don't generally have the budget for a C.C.

Around here, the response to crowded public courses are a variety of private "yard" courses, some of them pretty extensive and well appointed, true "country club" golf, without the showers and shoe polishing machines (so far).

Joe

those are all good ideas, but do not address the question of whether or not a metro area can support the number of rounds by nonmember and the number of members paying membership fees , regardless of how awesome the course is.

you are also adding labor costs - pro shop, clubhouse, restrooms... i doubt that you can build all of that for $300K unless you get free land.

if we define an active player as someone who playes 3-4 times a year in a competitive or sanctioned weekend event, the player base does not seem to be there.



Free land or free labour, at least.

I think there are more players out there like me that don't play in tournaments, but are very involved in the sport, although perhaps not at the level that I am. I don't know that I would settle on the above definition of "active player". The private course I mentioned above is for only 3 or 4 of us, none of whom play in tournaments, yet we all play very regularly. I can say without a doubt that we would gladly pay to play at a nice facility, especially one that had a clubhouse with taps.

I think in order to get a better idea of who would support such a facility, you would need to go to the courses and survey all players, not just PDGA members who participate in tournaments 3-4 times per year. I know they're out there because I'm one of them. I just don't know how many others there are.

I think the privately owned club is the way to go in terms of private facilities, but I think most of the financial scenarios suggested here are somewhat off the mark. Missing are the membership fees, the large chunk you shell out to join and thus "own" a portion of the facility. With time, the value of a membership should rise, so later arriving members don't ride for free. Since there are limited numbers of spots, a wait-list for membership might develop just as at the ritzy cc's. The initial large chunk of change from the first group of members could leverage a note for some land and facilities.


with all due respect... isn't that what I was saying in my last post? If not, that is what I meant to say :)

BBD is correct - that was the second scenario.

btw, paying a membership fee does make one an "owner" of a country club. it may confer some advatages and privilwedges, but it does not make you an owner. the argyument that later members rude for free is only valid if you believe early members will be there indefinitely. that is not the case. good input though, thanks!

with all due respect... isn't that what I was saying in my last post? If not, that is what I meant to say :)



Sorry, didn't mean to offend. I hadn't missed the figures you included in your post. I read the scenarios, I think yours above started with something like $100 per person. I think that sort of a fee is more akin to an annual fee that might follow a more sizeable (one-time) membership fee. I tried to make the distinction between a one-time fee and annual dues, which are both involved in joining many private social or sports clubs.

My thinking runs more along the line of a group of people forming a limited partnership, in essence. Partnerships would be transferrable so someone could "sell" if they decided to leave the club. It would be good to involve some sweat equity per member to plan for upkeep. There might be annual fees (along the lines of a few hundred per member per year) to keep some revenue flowing, along with guest fees, refreshment profits, etc.

This system offers the advantage of building up a good supply of cash initially, to get an operation going and to leverage necessary loans etc. It might not be the best option for an individual who wants to build a dg empire, but it might work if land isn't too costly and folks have an interest in building their own private Valhala over time.

I'm not sure if a plan more reliant on cash flow from a pay to play operation and smaller annual fees can support the funding to build much infrastructure, but its all pretty much guessing, anyway.

Besides "country clubs" other useful models for dg'ers to consider are hunting/fishing clubs and fraternal organizations, when looking for models of future growth opportunities.

Joe

no offense taken, I assure you. I just wanted to be sure that I didn't misspeak.

You're right, I wasn't talking about a one-time fee... I don't think too many DGers are going to want to go that route. Perhaps once the place is completed, different levels of membership could be offered. Maybe even offer the one-time-fee structure for membership in a club of some sort, but it can't be the only way to gain access to the basic facilities. I just don't think you could make any money that way.

If I was farther along in my life and financial picture... I might actually consider making this a part of my retirement. Hopefully someone will beat me to that... Pat, you're pretty old. what do you think? ;)

you and joeboth makes some good points so i am adding some things to the model. its getting closer but i am still worried about howto determine the size of the total player base.

that's obviously going to be an important variable, but I don't think you can reliably estimate something like that. If the course sucks... very small player base. if it's the best yet... large player base. Then it scales based on proximity to players. you will have to assume that your venture has a higher chance of attracting more players if it is close to a major metroplex. Honestly, the area where I live isn't a bad location for something like this since it's no more than about 45 mins from just about any other course in DFW (including Audubon, Z-Boaz, the Vet, and Cedar Hill). There's land to be had up here...

Distance from population centers is certainly a factor, but I think most folks will drive 30-45 minutes to play a nice private course with amenities.

I know this is not the norm, but the public course I just built is 1:15 from my house. The private course I built is 2 hours away, but I can also camp and ride my minibike out there, so there's an extra benefit/enticement.

If the course is well designed and built, has some amenities, and good aesthetics, I think it will attract people from a one-hour radius at least, and maybe a little more.

I may have missed factors in the initial premise, but any estimate of a "critical mass" player base (i.e. one that will provide ROI per your business plan) needs to factor the availability of other public/free courses.

Here in Mobile, AL (pop. 200K) we have eight courses within a 30-minute drive of downtown. Needless to say, there is also a substantial player base. Whether, at present, it is more than the 1,300 cited in the first post is doubtful. I wouldn't be surprised if the number was close to 1,000 players who play at least several times a month.

In ball golf, you are always going to have the Joes who play the muni courses regardless. The private course atmosphere or the initiation/annual fees will likely turn them away. I have done player surveys and I would conservatively estimate that this type a player comprises 75% of the total DG player base.

This may vary regionally ... after all, down in this neck of the woods we are mostly rednecks.The number of Yankee carpetbaggers and overlords who would join a country club is proportionally small (and most of them golf with crooked sticks).

Regardless, having moved here from Fredricksburg, VA and having helped mulch and rake the fairways of Mike Trepasso's pre-Grange course (the one with the tires with the sidewalls cut out), I think the most successful business models, especially for the pay-as-you-go or country club model, will evolve gradually from private individuals who get in primarily as a labor-of-love and second as a business opp or the Fly 18 concept piggybacking on existing facilities.

Regardless, having moved here from Fredricksburg, VA and having helped mulch and rake the fairways of Mike Trepasso's pre-Grange course (the one with the tires with the sidewalls cut out), I think the most successful business models, especially for the pay-as-you-go or country club model, will evolve gradually from private individuals who get in primarily as a labor-of-love and second as a business opp or the Fly 18 concept piggybacking on existing facilities.



Trapasso had intentions to to make his current place a member's only course but decided against it. His house is in full view of the golf courses and I think it would have been too much of an intrusion for his family to have a semi-commercial operation next to his residence.

On the other hand, if one could find a parcel that afforded the opportunity to shelter the residence from the golf course operation, or even subdivide it and separate the residence parcel from the golf course, land acquisition could be less of a burden in that you would be living on the property as opposed to buying a completely separate and remote parcel. Zoning might be an issue, but it's not insurmountable. In fact this could be a retirement situation. Buy a hunk of land, build a house, build a golf course and run it, help offset costs.