We provide an analysis for you of proposed expansions and the returns you can expect from an additional investment in your property. We can also perform due diligence for a proposed acquisition of a new property and recommend whether the investment will provide the return criteria the investor is seeking.
Often clubs do expansions of a clubhouse or add additional holes of golf to gain more revenues. They take out a loan, proceed with the project and quickly realize what a mistake they have made. They did not put together a pro forma, consider how the expansion would be marketed and what the marketing would cost, the margins on the revenue generated, the additional overhead in the form of payroll, insurance, utilities, property taxes, and other expenses that will be incurred and ultimately whether it makes sense or not based on a sound set of market driven assumptions. This analysis is absolutely necessary yet skipped in most cases. This analysis shows very quickly how viable, or not, an expansion will be. Overly enthusiastic Boards and club owners simply know they need something, have seen other clubs expand, so move forward with nothing more than a hope and prayer.
For acquisitions, people in love with the golf decide to buy a golf course and because the price is far less than what it cost to build, they think they are getting a great deal and jump right in. No consideration is given to key elements such as what the vision is for the course, how it will be marketed, the competitive environment around it, its unique selling proposition, marketing costs, operating costs, deferred maintenance and cash flow. It's pretty much figure it out as you go. We can do all of the work for you on the front end so you have a plan that will be in place with implementation begun on day one of ownership.
We take the guesswork out of expansions and acquisitions by doing the necessary work on the front end before any decision is made. Armed with facts and a plan, a club or investor can then decide to move forward with or abandon a project confidently with tangible reasons for the decision.
Click Here to Legendary Golf Management online about how we can help you grow your bottom line today or call us now at 1800-827-1663.
