While golf has happily resumed, with most golf courses having re-opened in the past week, the golf industry has taken a massive financial battering over the past three months of the lockdown.
The industry has already lost hundreds of millions of rands in revenue, thousands of jobs have been sacrificed, and the game continues to bleed while clubhouses remain closed. The food and beverage side of golf is crucially important to the welfare of clubs and supports more employment than golf course maintenance. Golf clubs cannot begin any recovery process until clubhouses open.
Had the lockdown ended a month earlier, the financial damage could have been contained to some extent. But the 11-week closure of courses took everything over the edge. Some historic clubs might still close unless members come to the rescue with interest-free loans and levies.
Had the golf course lockdown lasted until the end of June, another 18 days, the scenario could have been a complete disaster.
This week I have been contacting the general managers and golf directors at Top 100 clubs to find out if they had survived, how they have coped, and the situation they face going forward. Three managers replied to say they had lost their jobs. The golf industry is incredibly resilient, and many are positive about the future, yet most of them say that we will see a very different industry from the one we had.
Bryanston Country Club General Manager Paul Leishman said it might take a few months for clubs to discover the true financial impact of the lockdown. “It has been a gruelling time and a lot of clubs are reeling,” he said. “Another two weeks would have been disaster. I would guess about 40% of clubs have retrenched staff. Caddies, coaches and pro-shops were severely impacted as they don’t have any reserves and live on tight budgets in the best of times.”
Royal Johannesburg & Kensington CEO Chris Bentley said his club had survived “one of the hardest chapters in Royal’s history. Without food and beverage it remains a mountain to align minimal revenue to fixed costs.”
Bentley said the club had already lost R3.8-million in revenue from the start of the lockdown regulations on March 15, “and this will continue to worsen.” He announced that the club had cancelled its scheduled renovation of the West Course which was due to begin now.
East London Golf Club rely heavily on their clubhouse’s conference facilities for revenue as their Top 10 course attracts few tourists. “Three months ago the club was on track for one of our best financial years ever,” said GM Brenden Fourie. “Today we have laid off 50% of our staff, all F&B, and cut salaries. It is very sad.” Fourie himself has decided to leave East London for a new life in the UK.
Also holding back many clubs at the moment is the GolfRSA recommendation on 12-minute intervals between tee times, and one-tee starts. All clubs previously operated on 8- or 10-minute intervals, and two-tee starts. As a result golf clubs are having to turn away as many as 50 golfers a day who are keen to play. They are not able to cope with the demand. It’s costing the clubs in lost revenue.
During the lockdown there were rumours circulating about which clubs might have to close, including No 2-ranked Glendower in Johannesburg. “Totally untrue that Glendower has filed for liquidation,” said GM Sandy Burnard. “We had some incredible members who assisted the club these past three months in order to keep the ship sailing, and we are grateful to them. However, we need to do turnover to ensure the sustainability of the club going forward.”
Golf clubs are going to be relying more than ever on their membership to survive and flourish. Members are the chief beneficiaries right now of the re-opening, as they have exclusive right to tee times. Visitors will struggle to gain access to Top 100 courses. Being a member of a golf club will be more important than ever.
Kyalami CC in Gauteng, ranked No 26 in the Top 100, revealed their dire financial position in a letter to members at the end of May. Kyalami has a declining membership, down from 800 in 2015 to 450 today, and the club was unable to pay staff salaries in May. Members were asked to pay a levy of R4 000 each, but only 35% were able to do so. Kyalami are now considering the sale of operating rights to a third party to remove the immediate risk of the club closing its doors.
Victoria CC in Maritzburg are in a similar position. The re-opening of their course has not assisted the cash flow situation because 65% of members have prepaid rounds. Their general manager Martin Rose left in March. VCC urgently needs to raise R2-million to pay creditors by the end of June. The committee has proposed that 200 members be invited to lend funds to the club in tranches of R10 000.
As the lockdown dragged on, and weeks passed into months with golf courses unable to re-open, several golf estates and private clubs ignored the government regulations and allowed home owners or members to play under the guise of exercise.
This created considerable tension within the industry, but the rebellion might have hastened the end of the golf course closure. A group of 27 clubs were threatening legal action against the government.
“Lockdown was not made any easier when some courses decided to open illegally,” said Ebotse Links GM Hardus Maritz. “It put huge pressure on my CEO and I as members, and home owners pressurised us to open the course. However, management and the board of directors decided to stick to the rules throughout lockdown, one way of ensuring you always comply.”
Selborne Park golf estate on the KZN South Coast had several of their “swallows” residents staying on during the lockdown instead of returning to their home countries. “They were always asking us to let them play on the course,” said Estate Manager Andrew Young. “They were saying ‘we own the golf course, it’s our garden.’ We tried on numerous occasions to open during the 6am to 9am exercise period, but declined due to the GolfRSA negotiations with the government. We were always going to be ready once we got the green light. Our first tee time was at 7.04 on Saturday.”
Sun International’s three resort golf courses, the two at Sun City and the other at Wild Coast Sun, have not yet re-opened.
The Fancourt resort and estate in George is only operating one of its two golf courses during this time. This week the Outeniqua course was being used, and it will rotate on a weekly basis with the Montagu course until guests are allowed back. Only members and their house guests are allowed to play. Fancourt Links is open only to members.
Vaal de Grace, a Top 100 golf estate course in Parys in the Free State, closed its doors at the start of the lockdown when they retrenched all their staff.
Vulintaba Country Estate in the Northern Drakensberg, near Newcastle, retrenched their estate manager, greenkeeper and activities manager the day before lockdown on March 26, retaining just a few maintenance staff, and there is no news yet as to whether the scenic 9-hole layout has re-opened.
GOLF MORE POPULAR THAN EVER
Stellenbosch Golf Club in the Cape Winelands re-opened for golf on Sunday, June 14, and their members proved extremely eager to get out and play golf again. Stellenbosch opened their online booking system at noon on Saturday to give all their members an equal chance to book. Bookings opened for seven days in advance. According to Clubmaster, their POS system, Stellenbosch had the fastest start of all the Clubmaster clubs in South Africa, with 800 bookings in the first 15 minutes (an average of one every 1.2 seconds) and 1000 bookings within the first hour. Clubmaster is the largest locally developed and supported club management system in SA, used by more than 100 leading clubs.