Rock Lucas, the former NGCOA president and owner of Charwood Golf Club in West Columbia, South Carolina, says you can learn a lot about running a golf course these days just by hanging out with other business owners.
In late 2022, Lucas was at a buddy’s diner eating breakfast when he noticed chicken wings were no longer on the menu. He learned from the diner’s owner that the price had simply risen too high.
“And eggs went up from less than a dollar to $5, and they were going up again the following week,” Lucas says.
Earlier in 2022, Lucas was talking with another business owner about inflation and Lucas told him he thought hotdogs would start being sold at market price.
“I was half-heartedly joking, but almost everything has gone to market price. A local deli I visited did the same. It removed prices altogether and now it charges based on what that week’s cost is.”
Of course, food is just one victim of inflation. Lucas says he’s seen a gallon of paint rise to more than double in price and lumber too. “So any project is costing more.”
Lucas adds that Charwood passed along all the costs of inflation to its customers, just as many restaurants have.
“[The restaurants] either kept marking through their prices on the menu or not putting items on menus altogether, and we did the same. We didn’t lose one customer. We showed them our fuel spend compared to the same period [in the] prior year. They simply said ‘oh’."
Still, challenges beyond inflation remain. Lucas says that because the economy remains uncertain, he’s not making large financial decisions or opting for any long-term financing.
“We’ll only get what we can pay cash for, and if it all hits the fan, we could sell and get some cash back,” he says. “Or we’ll do short-term financing if need be. We’re operating like pre-pandemic – 2019 – numbers, although most of our clientele is a little recession proof – retirees and students. So that client base could be an opportunity.”
Another issue, Lucas says, is staffing.
“It has been and will continue to be a problem. Finding golf pros, full-time staff for the pro shop or the grill or for maintenance is difficult. We can find plenty of part-time employees, so we’re having to work multiple part-timers versus full-timers, which has its own issues. Our number of employees on the payroll is double what it was in 2019. Wages have more than doubled. Managing employees is much more difficult because they know they can find a job within an hour making the same or more money. Work ethic, pride in workmanship is not quite what it used to be.”
Regardless of the challenges, to Lucas’s way of thinking, course owners have made too much progress during Covid to let it slip away. “We must maintain the progress and gains, so prudent management practices are required.”
His advice to owners who are feeling the stress of a wobbly economy? “If you’ve been an owner pre-2007 to now, then you will be ok. You are a good operator. If you just got in the game, I hope you didn't think this was the norm, and that you have a rainy-day fund. I believe golf will be more resilient post-Covid than pre. Golf has taken on a more positive and important role in people's lives – provided they are financially stable.”
Lucas also recommends finding a peer group of golf course owners and operators.
“Bend their ears, pick their brains. Make sure they’ve been around awhile and are well respected. If you are the smartest person in the room, then you’re in the wrong room. Lean on business owners in other industries as well. Find out what they’re thinking and doing. Most of all my friends are self-employed, so I get a feel for them as well.”