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kahn 12 2010

ABOUT MIKE KAHN

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Fixer-Uppers Could be Good Now

The Growing Private Club Dilemma!

MARKETING: Cheap prices as a means to compete is not always the answer

2008-9: Is this the Best Time Ever to Buy a Golf Course?

golf ball

It was the Ball! What I think you should know.

What Not to Do as a First-Time Golf Course Buyer

The Future of the Golf Business as I see it.

Golf Course Buyer's Guide

Financing a golf course

Finance to Buy, or Refinance a Golf

Course. Start the Process Here

You'll think I'm NUTS saying we need 1,000 more golf courses - until you read this

A Golf Course Buyers Formula

Getting a Golf Course Loan.

Avoid Mistakes that Scare Lenders Away!

Golf Business Experience. Mike Kahn's 50-Years.

Marketing a Golf Course: Simple Rules

Golf Business Consultation. Your first one is Free.

Golf Business Consulting. What Will it Cost?

The Truth About the Golf Business Today.

The Golf Course Superintendent? Do You Need One?

Golf Course Feasibility. Have You Updated Yours?

Buying Default Golf Courses Can be Lucrative for Tax Purposes

Golf Participation Statistics

A Golf Expert's Advice to Bankers

Golf Investors FAQ Sheet

Golf Course Financing. Where to look.

New Golf Courses. Your Players!

Golf Course Analysis

How to Create a French Drain

Golf Business FAQ Sheet

Golf Participation Statistic

Do you need a Superintendent?

Golf Operators. Watch Your DSR

How Banks Run Golf Courses. Have a look...

Tough Times for the Golf Business?

Golf Course Operator's Axioms

Golf's REITS and Trusts Distorting Factors

The Financial Downfall of Many Golf Courses -The "Big-Foot" Clubhouse?

The truth about the golf business.

Planning a Career in Golf?

Enjoy this editorial. "It was the Golf Ball!"

Kahn's Golf Biz Axioms

About Your Free Golf Business Consultation

Great Golf Web Site!

Members. Keep them Happy and Spending

Message to Bankers

Golf Course Management Companies: An Opinion 

Best information: The National Golf Foundation

About a Golf Course Analysis

GOLFMAK, INC.

Email: mike@golfmak.com

Phone: 941.739.3990

Fax: 425.675.6909

BRADENTON, FL

Michael A Kahn, Golf Business Consultant. From Grass to Finance. Over 50-Years at Your Service. Email: mike@golfmak.com

IT WAS THE BALL..........BALL

I wrote this article in 2000. Read the last paragraph.

What 'event' do you think was most responsible for the growth of golf since WW2 - especially since 1960?

TV? NO!
ARNOLD PALMER? NO!
PRESIDENT DWIGHT D. EISENHOWER? NO!

IT WAS THE DEVELOPMENT OF THE ONE-PIECE GOLF BALL!

Did you know that a Spalding Golf Ball cost $1.00 in 1919? You could mail a letter for a half a cent. An advertisement in 'Canadian Golfer Magazine' listed a new Ford at $495.00. Average annual earnings in 1919 was less than $700.00. Therefore, a golf ball cost 1/700th of an average person's annual income. If the price of a golf ball kept up with inflation, a new ball today would cost somewhere around $66.00 - about $692.00 a dozen.

In 1959 a Titleist golf ball sold for $1.25, or $15.00 a dozen in our Toronto, Canada Pro Shop (back when the Canadian dollar was worth about $1.15 US). The balls had balata covers that split when topped with a short iron - making the ball unplayable. Few golf balls made in 1960 could be used for more than one round of golf. The cheapest ball in our Toronto shop was a 70 compression 'marsh mallow' by Campbell of Canada at 50 cents each, $6.00 a dozen. The ball was only round until first struck. Meanwhile, my dad earned close to $5,000 a year - not bad in 1960. A 50 cent ball cost 1/10,000th of my Father's income.

An article circulated on the Internet by Golf World indicated golf balls by the dozen sold in November (2000) at an average of $24.81 a dozen, or about $2.06 a ball. Therefore, if the average golfer earns, say $50,000 a year, an average price golf ball costs about 1/25,000th of his or her annual income. But there's another reason the modern golf ball made golf more accessible for more people.

Today, if you don't loose a ball, you can play it virtually all summer. And used golf balls are often sold over and over again until the dimples are virtually worn smooth. Then they might spend their last days wearing a red stripe.

So, what is the real reason the game of golf was able to grow so strongly since 1960? It's because the golf balls became so inexpensive? And that was because of Plastics!

It was the chemistry of plastics that developed composites that make up golf balls today. I remember how the first cut-proof golf balls amazed us all! Among the first to show up in the early seventies was the one-piece ball. (I was told that the material used for the first one-piece balls was discovered by accident when a chemist dropped an experimental chunk designed for insulating electric wire and saw it bounce.) I experienced the earlier one-piece ball attempts - seeing many splitting in two or more pieces when struck hard (I adopted the one-piece ball on my driving range immediately in 1972 or 73, but splitting one-piece golf balls would cause problems jamming the ball washer and sometimes jamming the ball picker). But the cat was out of the bag and the golf ball became one of the most durable values of anything you can buy today. Yes, you can buy a golf ball today for $1 dollar that will fly over 300 yards, spin at over 4,000 revs, roll perfectly true, keep its color, and last several rounds (if not lost). The cover material called 'Surlyn' (a trade name) was another breakthrough.

Chemists can work compositions like Surlyn to react as they please. Want a ball to fly higher, more or less spin, go farther, stay white longer, or 'feel' softer? It's all in the recipe.

Anyway, if we backed up the cost of today's golf balls to year 1919, a ball would have cost about about 1.4 pennies each, or less than 17cents a dozen. Then your average great grandfather could have afforded to play golf in 1919.

Therefore, it is the opinion of this writer that the recent developments in the durability and affordability of the golf ball has more to do with the growth of golf than any other factor. Only one problem...

The architects and golf course developers are killing the game by spending too much to build new golf courses. They can't seem to build an enjoyable golf course for less than $5 million, including clubhouse, etc. Actually, they can, but they somehow refuse to try. Figure green fees at $10.00 per million spent to build a golf course and you can set the minimum price to play new $5 million golf courses at $50.00.

Funny thing! A golf ball cost $1.25 in 1959, when a round of golf on a Wednesday was $1.25 at our public golf course in Toronto, Canada. Public courses in the area now charge over $60.00 to play today, but the price of a golf ball is still not much more than a $1 dollar. In 1919, if you could find a public golf course, you could play it for about a quarter - when a golf ball cost $1.00. Too bad, because it's going to get worse.

Unless cooler heads prevail in the construction of new golf courses, look for a decline in golf participation in the next few years - with or without Tiger. There are already a number of golf courses in financial trouble in Canada and the USA (some estimates as high as one in four golf courses cannot pay their bills). They can't pay their bills, because play has dropped.

Michael A Kahn, 2009 - 2010

 

 

 

 
 

EXPERIENCE (going back to 1956)

I have successfully managed: Private, Semi-Private, Public, Par-3, Executive Courses, and Lighted Practice Ranges.

Former Licensed Superintendent for Weedicides, Herbicides, Aquatic Weedicides, and Acquatic Herbicides

Finance Consultant: Placed over $100 million in golf course financing.

Former PGA Assistant Pro includiing the art of old-time backshop club repair (old fashioned methods),

Teaching professional Private and Group teaching for over 30-years

Former Golf Course Owner

Off-course retail store chain owner

Golf Course Broker - Over $100 millin in golf courses sold

Web site planning and publishing

Golf Course Turnaround Specialist

Clubhouse Design and Planning Consultant

Golf Course Buyer's Diligence Specialist

Golf Business Consultant

REVIEWED HUNDREDS OF GOLF COURSES

Ontario

Montana

Conecticutt

New York

Michigan

Ohio

Illinois

North Carolina

South Carolina

Georgia

Florida

Alabama

Louisiana

Texas

Caloifornia

Colorado

Kentucky

Tennessee

Minnesota

Isle of Wight (UK)

A PIONEER

Solid Range Balls

Tri-Plex Greens Mowers

Hydraulic Drive Reels

Cavity Back Golf Clubs

Private Brand Golf Clubs

Internet Tee Times Sales

Flymo (floating rotary mower)

Graphite Shafts

Indoor Golf Schools

Female Greens Employees

Non-Chemical Release Golf Course Fertilizers

Floodlit Night Golf

Video Tape Golf Teaching

Tee-Time Re-Selling

Golf Course Web Sites

100% Wall-to-wall bentgrass fairways

Using 3-wheel Motor Bikes as Work and Personnel Carriers (now trap rake vehicles)

Copywriting and Marketing Golf Courses on Radio, TV, Newspaper, and Billboards

Financial Statements for a Golf Course on Computer (Lotus 123)

Point-of-Sale Systems for Golf Courses