The Cost of Golf

Recently I joined my childhood friends for our annual men’s weekend in Myrtle Beach for fishing and golf. My angling skills are below average, so most of my time is spent on the links. October is one of the busiest months for golf, and though the rounds were long, it was a perfect way to spend each afternoon. Returning to the condominium, I emptied my pockets and looked at the number of receipts collected; green fees, another one for lunch, and a third one for souvenir golf ball. It left me wondering, what does it take to make a golf club successful? 

There are 58 golf courses within a 20-mile radius of Myrtle Beach, including 52 Public, 1 municipal and 5 private courses.  As you might imagine, there are several steps and costs to opening a course. Land acquisition, course design, construction, facilities development, equipment, permitting and licensing, and those are just the obvious ones. The estimated start-up cost ranges from $2 to $6 million, and that is only the beginning. Annual maintenance is key to ensuring playability and aesthetic appeal. On average, the cost to maintain an 18-hole golf course is $800,000 a year, or $44,444 per hole. These costs vary based on location, type of course, maintenance standards, and weather. As time passes, everything around the course will require renovation, updating equipment and more.   

Of course, this brings us to one of the most crucial components of a successful golf facility, staff. When I play golf, interacting with the staff is one of my favorite parts, and it influences my decision to come back. But to have an outgoing, knowledgeable staff, you must be willing to pay for it. General managers, head professionals and administrative staff usually earn between $50,000 to $150,000 annually. Ground crew and maintenance staff can range from $25,000 to $50,000. In locations such as Myrtle Beach, and other destination areas, additional staff during peak seasons can increase labor costs by $50,000 to $100,000 annually.  

Successful courses depend on several streams of income. After all, once they have you on site, maximum enjoyment is their goal in order to send you home with all those receipts. Green fees can range from $20 to $200. The average green fee in the United States is $43, while the average cost in Myrtle Beach is closer to $70 during the prime season. The onsite restaurants and bars provide food and beverages to enjoy during or after the round. Golf courses in destination areas have higher merchandise sales than local courses  

What’s the bottom line? Opening and operating a  golf course is complex and requires careful financial planning and management. Much like personal financial planning, many facets are at play and many elements must be considered. Understanding the financial landscape is crucial for sustainability and success, whether it’s a golf course, any other business, or your personal financial affairs.   

See you on the course.