Golf and The Silver Lining

Golf and The Silver Lining

Golf – the word is almost a synonym for stress-reduction. It’s what you do to get your pulse rate and blood pressure down after a week of worktime worries. But many of those running golf facilities are themselves under major stress: the challenge they face is their very survival. And unless they sustain current membership levels and revenues, the clubs might not survive.
This challenge is acute for golf courses on the lower South Coast of KwaZulu-Natal, almost all of which rely on bursts of activity around the major holiday seasons for much of their annual playing revenues.

A golf course can’t be mothballed for nine months of the year between the seasons: whether a course is on the South Coast or in one of the large metropolitan areas, turf management and the maintenance carry on throughout the year, with the related costs. So the show must go on.
However, while big budgets of tens of thousands of rounds and large memberships are nice to have, they are not the only way to keep a club’s finances in the black. The Southbroom Golf Club has managed to effect many improvements through careful management and the effective harbouring of resources and revenues, to such an extent that it has accumulated a healthy reserve fund for a rainy day or for future capital expenditure.

Are there lessons here? In this era in which professional management companies and traditional committee-based management structures sometimes seem like implacable foes, will golf clubs prove that committees can work effectively with professional management teams?
The consensus among clubs I approached in this region was that the annual rounds numbers were down on previous years – they were certainly lower than when I was based here – and that the lower numbers had not been buffered by price increases. This gap has required management to be especially vigilant about expenditure and building and conserving cash reserves.

Sustaining membership levels also poses a challenge: a club needs paying and active members to keep afloat. Carrie Pieterse, the manager at Port Shepstone Country Club – a personal favourite of mine, with its very contrasting two nines – explained that the club has a perennial struggle growing membership through its juniors. The simple fact is that once the junior golfers have matriculated or completed their tertiary studies, they invariably find their first jobs in one of the major centres or overseas. This exodus means the club has to depend for its growth on new groups of retirees coming to settle at the coast.

But it’s not all doom and gloom. Every cloud, we’re assured, has a silver lining, and it looks as if the travails of the rand may offer two upsides.

For South Africans, even wealthy ones, the costs of traveling overseas have become prohibitive, thanks to the rand’s depreciating by almost 30% over the past 18 months. This is comparable to what happened in the UK and Europe in the early part of the millennium, when the spike in travel costs, largely linked to fuel price increases, led to increased regional tourism. A UK friend of mine with two children commented at the time, when planning his family’s annual vacation, “Never has home looked so good!” The same might well happen here in South Africa: in comparison with the eye-watering costs of a family visit to Disneyland Paris, South Africa offers stay-at-home holiday makers really great value and a very broad choice.
The very same depressing arithmetic means that the region now offers world travellers a great destination at bargain basement prices. A significant number of the “swallows” who come down from Northern Europe to the South Coast have been converted into regulars, and many of these have invested in the region by purchasing their own holiday homes.

Gary Purtell, the CEO of Realty 1 Southbroom, sees visitors coming down from as early as September through to the end of November, when they go back north for Christmas, after which they return and stay from mid January to the beginning of the Easter season. One of his German clients observed that it was cheaper to come down to South Africa and live here in the northern winter than it was just to run his central heating at home in Europe over the same period!

The San Lameer Resort Hotel and the San Lameer Estate are, like many similar operations, aware of these factors and of the need to market to both the local and international markets. This presents a dual challenge to facilities that can’t equal the massive budgets for above-the-line advertising that the large international groups enjoy. The need to be creative in their use of their advertising and promotional budgets and innovative in their approach to the identified markets is paramount.

An important part of this creativity and innovation is pursuing strength through association, cooperation and the pooling of resources, which is where bodies like South Coast Tourism (SCT) can be so effective. SCT effectively carries the interests of all of its members out into the marketplace – to shows and exhibitions and through various marketing initiatives designed to promote the region as a whole. This offers SCT’s members a collective promotional and marketing platform which can then be enhanced by the individual businesses’ own marketing and advertising activities.

Indications from the government – most recently in the President’s 2016 state of the nation address – are that South African Tourism will be allocated up to R100 million per annum to support the promotion of regional tourism. So the future for this particular sector looks very bright.

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