Club Benchmarking - 23 January 2017
The most successful private club executives are in a class of their own when it comes hospitality. They are experts at delivering an extraordinary club experience and managing large teams of people, but we’ve only met a handful that would be comfortable calling themselves experts in accounting or finance. While that’s not surprising since the skillsets are so different, it does present a challenge.
Club Benchmarking - 16 January 2017
Guest Author and Club Benchmarking SubscriberMedinah Food Truck.jpg As most club managers do, I try to spend our capital dollars in the most prudent way possible. When the idea struck me to obtain a food truck and brand it with our logo, I kind of figured that I was going to get some raised eyebrows along with some direct questioning. Once the interrogation was over, the end result was surprising and very gratifying.
Club Benchmarking - 18 October 2016
The private club industry in the United States has been a work in progress for more than 200 years. Clubs are deeply grounded in history and tradition, which may help to explain why the pace of change tends to be slower than in other industries. The evolution of clubs over the last few decades is apparent in areas such as social and culinary trends, but not as easy to recognize on the business side of things, so we turned to a veteran club management professional to get his perspective.
Club Benchmarking - 27 September 2016
Charting a New Course for Your Club. Every business charts the course for the coming year through the annual budget process, and private clubs are no exception to that rule. For many, the experience can be drawn out, difficult and fraught with struggles over tactical items, but we believe we’re seeing a positive change on the horizon as more clubs recognize the need for a strategic, fact-based approach to budgeting. Try to imagine going into the boardroom to present next year’s budget and walking back out, mission accomplished, in under an hour. That’s the inspiration for a story we’d like to share about a club where a shift toward data-driven, strategic decision making has transformed the budget process. For the sake of anonymity, we’ll call it Anytown Club.
Club Benchmarking - 16 August 2016
Clubs share a common business model, but when it comes to more qualitative aspects like culture, each individual club is truly unique. At the highest level, a club’s culture is defined by factors such as history, mission, traditions, member demographics, location and the mix of amenities enjoyed by its members. Below the surface, there is another very important but less obvious factor at work that influences the member experience on a daily basis and ultimately shapes the club’s future; the operational mindset. Are the club’s board, management and members focused on value creation or are they operating in a mode of extreme cost control?
Club Benchmarking - 6 May 2016
Armies of people study the dynamics of industries across the world. Bankers, investors, competitors, consultants—searching for clarity and insight on the factors that separate market winners from losers. Analysis of industry dynamics in every market is unceasing and those with the best information are poised to win. Financial models are a central element of understanding both industry dynamics and the performance of an individual business within the market in terms of its financial sustainability and long-term success. Such models exist to unearth and convey the key drivers of financial success. Investors, consultants and companies spend significant money developing financial models so they can understand how revenue, costs, margins, overhead, leverage and other financial metrics impact profitability and growth. The quest for fact-based insight is a direct and necessary response to unyielding competition and business challenges. The private club industry can’t escape this reality.
Club Benchmarking - 9 October 2015
Whether you're just starting next year's budget or you're further along in the process, benchmarking is a great way to "fact check" your decisions. Consult high-level reports like the Executive Dashboard for strategic perspective on performance and the sustainability of your financial model. Department-level reports (Food & Beverage, Course Maintenance, Labor etc.) provide a solid, fact-based frame of reference and credible third-party support for your decisions. Club Benchmarking Essentials and Premium plan subscribers can also use the new Financial Forecasting feature to track progress throughout the year and get a look ahead at where those decisions are taking them.
Club Benchmarking - 6 October 2015
The Key Performance Indicators related to club operations in the third section of the Executive Dashboard address two essential aspects of the delicate balance between member expectations and a club’s financial realities. Undertaking a fact-based assessment of these two extremely sensitive issues, club payroll and food and beverage (F&B) results, can turn emotional boardroom debates into focused business discussions.
Club Benchmarking - 19 June 2015
The “Capital Generation” section of the Executive Dashboard is comprised of three Key Performance Indicators that correlate directly to a club’s future. Healthy capital generation supports ongoing investment in the kind of facilities and amenities that a club must have to attract and retain members in an increasingly competitive market. Inversely, inadequate capital generation can lead to deterioration of the club’s offerings, declining membership and over time a financial and operational spiral that is difficult to reverse. This section of the Executive Dashboard helps club leaders assess the current state of their capital generation “engine” and determine what if any adjustments are needed to move the club toward the desired future outcomes.
Club Benchmarking - 12 May 2015
You’ve heard the phrase “measure what matters,” but how do you decide what really matters for your club? While the answer may vary from club to club, the goal is still the same—to identify a set of measures that can be used to accurately assess, manage and predict financial and operational performance. Deciding what to measure begins by figuring out what you need to know about your club. In Einstein’s words, you start by “determining the proper questions to ask.”
Club Benchmarking - 31 March 2015
You know it when you see it. A private club facility that looks tired and outdated can leave you with the feeling that the club’s leadership either doesn’t care or can’t afford to make improvements. It’s not an impression anyone wants to make on current or prospective members. Unfortunately for many clubs, in today’s sluggish membership market, the flow of initiation fees typically used to fund capital improvement projects has become extremely inconsistent and unpredictable. A proactive understanding of this strategic aspect of your club’s finances is the key to avoiding the dangerous downward cycle we call Capital Starvation. It starts with three key questions.
Club Benchmarking - 1 October 2014
If you’re losing money or breaking even on food and beverage, you’re in good company. Just don’t lose money for the wrong reasons. club food and beverageWhen Ken Butler was interviewing for the position of chief operating officer at the Berkshire Country Club in Reading, PA, in 2012, the board members asked him how he would turn around food and beverage. He answered by asking them, "Why would you want to?" and they looked at him like he was crazy.
Club Benchmarking - 28 August 2014
As a career choice, club management presents a unique set of challenges. One of the most unusual aspects is that club general managers (GMs) get a new boss every year or two due to board turnover. Over two or three decades in the business, even if he or she stays at one club, a professional club manager will work for dozens of club presidents and hundreds of board members. Many of those bosses will be strong leaders, some will be neutral influences, and then there are the others.. that president or board member who leaves you wondering whether you will lose your job or quit before the year is out.
Club Benchmarking - 21 August 2014
The industry debate over how much a club should budget to maintain its golf course seems never-ending, and that’s understandable. The course consumes a significant portion of the cash required to run a club and it is also one of the most visible and member-impacting amenities, so a high degree of focus is justified. As a start, let’s consider the following scenario: While the median club in the country spends close to $1.2M on course maintenance, two clubs within a few miles of each other spend $700K and $1.75M respectively on their 18-hole courses. We all know, and have probably played at, clubs on both ends of this spectrum.
Club Benchmarking - 17 June 2014
The structure and focus of the typical club management team has changed significantly over the last two decades with the addition of Membership Marketing Professionals, Member Communications specialists and, most recently, the position of Human Resource Manager or Director. The people taking on these new roles must be provided with appropriate tools and a supportive network of peers in order to be successful.