TORONTO, Ontario (March 5, 2012) – Just as most golfers would not play a round without a scorecard, neither should course operators run their businesses without an income statement, according to Henry DeLozier, a principal of Global Golf Advisors, the golf industry’s leading authority on course ownership and management best practices, club lifestyle enhancement and member facilitation.
“An income statement is the scorecard for your business,” DeLozier told attendees at the 2012 NGCOA Annual Conference in Las Vegas last week. “Anytime you need anything from a bank, the bank’s first question is going to be, ‘Where is your income statement?'”
During a session titled “Determining the Profitability of Your Golf Course: Creating a P&L,” DeLozier also encouraged operators to use zero-based budgeting when creating their annual plans.
“We have a tendency – because we’re all very busy – to just take last year’s budget and apply a percentage increase or decrease across the board,” said DeLozier, whose firm is celebrating 20 years as a golf club management consultant. DeLozier said Global Golf Advisors encourages its clients to “imagine that you just bought the golf course” and are creating their first budget. “Even the best operators will find inefficiencies and potential savings when they start from zero and really examine their budgets and their assumptions.”
As part of the budgeting process, operators should challenge their overhead costs in an effort to lower expenses, according to DeLozier. “For example, ask your utility provider for an estimate of your 2012 utility costs and then ask how you can get a discount or reduce your bill. It’s well worth asking the question.
“You should shop your cost line items all the time,” DeLozier continued. “It’s a lot of work, but if you put in the time to go line by line through your budget and really attack your overhead, you’ll find inefficiencies.”
On the revenue side of the business, DeLozier said a “revenue menu,” which lists the facility’s revenue sources, helps identify opportunities to raise prices. “You want to raise prices throughout your revenue menu every time you can,” he said. “Raising the price of a bottle of pop or range balls a minimum amount probably will not raise eyebrows among your customers, but it will help you keep up with costs.”
About Global Golf Advisors
Global Golf Advisors is an international consulting practice that helps golf course owners, financial institutions and real estate developers solve problems related to course management and operations. The Toronto-based firm takes a 360-degree view of management and operational issues before developing a strategic plan that establishes benchmarks for success and identifies potential outcomes of recommended actions. In its 20-year history, GGA has consulted on more than 2,000 golf-related projects worldwide. For more information, please visit www.globalgolfadvisors.com or call 888-432-9494.
Contact:
Bill Bryant, Bryant Marketing Communications
bbryant@bryantmarcomm.com
678-366-3232
Henry DeLozier
Global Golf Advisors
hdelozier@globalgolfadvisors.com
602-739-0488
