The Golf Course Business Consultant

Talk to me first if you are even thinking about buying a golf course in the 2011-2012market environment!

It's 2011 and we are seeing many devastating golf course crashes... all predicted by your's truly!

Banks, banks, banks! They're inundated with golf courses and they have no idea what to do with them. Many appraise below the mortageforeclosed . Debt ratios are negative. Textron has dozens of non-performing golf courses. Wells Fargo has all those failed Wachovia golf course notes. Small community banks everywhere have defaulted golf courses on their balance sheets.


What to do?

If you're in the market to own a golf course - talk to me first. There are deals out there, but 'money-pits' outnumber sound investments. I'm better at analyzing a golf course than anyone in the business in 2011.

I don't fall in love with golf courses. I look at them as businesses. If I see a place that has no upside I have 100% confidence in myself to say so (subject to disclaimer, of course).


Was I the only one to see what was coming?

Participation statistics: Updated 09/16/04 and November 25, 2010

Note: This article is more than ten years old, but most of the info still applies today. My comments have been added in black font.


Average Rounds Played For the past 10 years, the typical golfer was characterized as: male, 40 years old, with household income of $68,209 (2004 - $75,000?) and played 21.3 rounds (may actually be less than 21.3 in 2004) per year. This statistic is now being challenged from multiple demographic sectors.


Beginning golfers are averaging about 10 rounds per year and account for approximately 28 million or 5.4% of all rounds played. The total number of rounds played each year by beginners has increased 146% over the past five years. Juniors are averaging 12.5 rounds per year and account for 8% of all rounds (the First Tee should improve this number even more). Their contribution to the national rounds played total has increased 42% since 1994.

SENIOR GOLFERS (90's article)

50+ years (2011 - now 60+ years): This segment is by far the rounds played leader averaging 36 rounds per year and accounting for nearly 45% of all rounds played. However, this segment is not growing as expected in tandem with the aging of America. Numbering about 6.5 million or about 24% of all golfers, this segment has grown by only some 4% over the past five years (a highly lucrative new golfer market that is primarily ignored - even by the First Tee).

AVID GOLFERS - DECLINED BY AN ESTIMATED 200,000 (likely much higher decline from 2000 through 2010)

25+ rounds/yr: The guess is that most of these 200,000 simply failed to play their normal number of rounds and thus reclassified themselves as Moderate Golfers [8-24 rounds/yr.], which increased by 6.4% or 500,000 golfers last year. The fact that Occasional Golfers [1-7 rounds/yr.] also declined indicates that a good number of them played more than their normal number of rounds last year and thus, like their Avid, counterparts became Moderate Golfers.


The Avid members of this segment compare very favorably to their male counterparts when it comes to rounds played. The average woman golfer is 42 years old, has an average household income of $68,908 and plays 17 rounds per year.

Minority Participation Roughly, 10% or 2.4 million of today's golfers represent an ethnic minority. Of this number, an estimated 882,000 are African-Americans and some 851,000 are Asian/Pacific Islanders. The remaining 712,000 consist primarily of Native Americans. Since 1996, the African-American golfer population has increased approximately 30%.

Public vs. Private Golfers Approximately 80% of all U.S. golfers play most of their rounds at public facilities. The average public golfer plays less than half as many rounds per year (13) as does the average private club player (34).


The demand to play at any particular course will be a function of many attributes of the course. Some of these are objectively measurable, such as the number of sand traps, the size of the greens, or the size of the clubhouse. Others are only subjectively measurable, such as the condition of the course or the aesthetic beauty of the setting and views. According to the National Golf Foundation's Golf Consumer Profile, the population of potential golfers is systematically related to the demographics of the underlying population, especially age and income.

A second important factor to golfers is the difficulty of the course. Although some beginner golfers and some older senior citizens prefer to play on an "easy" golf course, most golfers seem to prefer more difficulty (I don't believe that. Any difficult golf course I've been associated with has not benefited by beating up players with long forced carries, 4-putt greens, and $50 worth of lost balls. - Mike Kahn). There are many ways to measure the course's difficulty. The number of water hazards or bunkers possibly provides a direct measure and is objectively countable. The overall length of the course measured in yards also is a possibility, since short courses typically are easier to play. Additionally, local and national golf associations have developed rating systems of course difficulty (higher ratings mean a more difficult golf course).

Another important factor is the pace of play. Waiting to play is not enjoyable, so most suspect that slow play will negatively affect the demand on a particular course. Unfortunately, there is no easy way to measure the pace of play. At most courses, the pace is swift early in the morning; however, once a slower group is on the course, all the groups behind will have to wait. Short of clocking, every round at every course over a period there is no direct way to measure this effect. However, some other variables may be correlated to slow play (I blame the design of golf courses for all slow play problems. If golf course architects designed highways, three cars would be a traffic jam!). In addition, restriction of golf carts to cart paths will require golfers to spend more time walking back and forth from the cart to the ball. The following recent survey indicates ‘weight’ factors golfers seriously consider when choosing a place to play golf:

Cost/price of Green Fees 72%

Course condition 69%

Availability of Tee-off times 68%

Proximity to home 44%

Speed of play 38% (Then why do most municipal courses take six hours to play?)

Course design 33% (Only by golf snobs)

Difficulty of course 20% (Only by scratch players)

Ability to score well 18% (I think golfers like to play courses they can have a satisfying score)

Amenities 15% (Good greens, fairways, tees - and the beer is cold.)

Pro shop 9% (Right!)

Food/Service 5% (Not really an issue.)

Name of course designer 2% (Only the snobs, again!)



Supported by favorable demographics (aging of the Baby Boomers), the golf industry can expect a "natural" addition of approximately 3 to 4 million golfers and 100 million rounds over the next decade. This translates into a growth rate of 1% to 2% per year. If industry stakeholders stimulate only a small portion (20% to 30% over 12 years) of an estimated 41 million highly interested players and potential players, then rounds played could grow at 3% to 4% per year, or twice the rate of the "natural" growth scenario. Golfers could grow to 34 million and rounds played to 780 million. The latent demand of 41 million includes people who are highly interested in golf and expect to play or play more frequently in the future. These "high-potential" candidates are the best opportunity for golf to grow its ranks of committed golfers. There are four groups of candidates:

Current Players — The largest opportunity for growth rests among those presently playing less than 25 rounds per year. The potential of this group can be realized by retaining and migrating them too more advanced levels. Over 14 million current golfers have a high interest in the game and desire to play more. In addition, Minority Golf Magazine reports that this year (2001) there will be some 4 million people of color playing golf, a 60 percent increase since 1997. As well given the significant advances in adaptive equipment for people with disabilities the Company will use best its efforts to provide greater access for full participation.

Former Golfers — Twelve million former golfers (out of 42 million adult former golfers) indicate that they have a high interest in becoming committed golfers. These people though, have specific problems inhibiting their return to the game (e.g. intimidating environment, cost of play, difficulty learning the game and no one to play with).

Non-Golfers — Only about 7 million (representing about 5%) of the 130 million non-golfers, are highly interested in the game. Golf is doing a good job in offering opportunities for those interested in trying the game (NO! They are (in 2010 still) not). Many of the first time players quickly exit the game, having an early experience insufficient to justify the time and expense involved. Interestingly, 60% of the non-golfer opportunity group is women (versus being only 20% of the overall golf population). For golf to become a more satisfying experience among a wider range of people, particularly women, golf will need to enhance and strengthen people's early experiences (New golfers need to play easier courses. Too often, new players are expected to play in far too difficult situations that only discourage).

Junior Golf—Junior golfers represent another opportunity for the industry. There are 51 million juniors in the US age 5 to 17. Fifteen to eighteen percent of these juniors would like to play more. Less than 10% presently play golf. Encouraging for the industry is the fact that juniors who presently play golf really enjoy the game. Juniors who play golf like it nearly as much as team sports and more than other individual sports. (Read my article, "Why we need 2000 more golf courses")

Mike Kahn: 941-739-3990