Managing a Golf Business - Assignment Example

? Managing a Golf Business Contents Contents 2 Assessment of the Past/Current Situation 5 Internal Analysis of the Business 5 Strengths 5 Weakness 6 Assessment of the Competition and the Market 6 External Analysis of the Business 6 Opportunities 6 Threats 7 Objectives 8 Short Term 8 Medium Term 8 Long Term 8 Development Plan of Indoor Teaching Facility 9 Layout 9 Equipment Required 10 Opening and Closing Schedules 11 Marketing and Promotional Activities 11 Concept 11 Inferences to the Interviews 11 Staffing Plan 13 Staffs Allocated 13 Working Hours 14 Staff Rotas 14 Incentive Plan 14 Training Schemes 14 Health and Safety Standards 15 Profit and loss projections 15 Cash Flow Forecast 18 Break-even analysis 19 References 21 Appendix 23 Questionnaire 23 Assessment of the Past/Current Situation Internal Analysis of the Business The Internal Analysis of the Business would be carried out through the evaluation of the Strengths and Weakness involved relating to the existing business environment of the Professional Golf Club. Strengths Firstly the parameter of customization rendered in the Golf Club in the manner of supplying instruments that would fit the physical attributes of different individuals helped in attracting different people to the club. Rendering of ‘Custom-Fitting’ equipments for the individual golfers rather than depending on ‘Off-the-Shelf’ technique helped the company gain on larger revenue margins. The ‘Off-the-Shelf’ clubs depended more on the custom of ‘One-Size-Fits-For-All’ that tended to affect customer interests and thereby affected profits and revenues earned. Secondly the dry summer months add to the strength of the company in significantly contributing to the turnovers of the firm. Thirdly the work atmosphere in the Professional Golf Club is also found to be quite amicable and prosperous for development of business relations. The work atmosphere is also found quite congenial in fostering an environment that would promote innovation and empowerment. Weakness Firstly the current state of business affairs relating to the carrying out of the training operations of the Golf Professional Club is affected by the emergence of the winter and wet summer months. The business is affected owing to the wet outside soil restraining effective performance of golf training sessions. Such seasonal factors also happen to create obstacle to the optimal utilisation of the resources available with the Golf Club and thus restrain the effective meeting of customer care needs. Secondly the space rendered to carry out training activities indoors has also been seriously affected owing to unavailability of adequate space. Thus under-utilisation of the available space and resources coupled with bad weather and soil conditions contributed in weakening of the existing business conditions. Assessment of the Competition and the Market External Analysis of the Business Opportunities The demographic factors of the Mere Valley region render a host of opportunities for the Professional Golf Club to effectively thrive in the area. Mere Valley population consists of high income individuals and also composed of people from business backgrounds possessing a passion for Golf. These people are frequent visitors or members of the Golf Club that in turn reflects the opportunity for the club to further expand in helping the people to pursue Golf as an effective sport. Moreover the availability of large number of open spaces in the Mere Valley region also renders significant opportunities for the Golf Club to effectively grow and accommodate a larger crowd of trainees. Thus presence of required customer profiles along with open spaces effectively contributes in business continuity of the Golf Training and Professional Club in the region. Moreover the availability of baking facilities in the region also helps the different clubs to gain adequate loans for working on renovation and replenishment activities in an effective fashion. Threats Firstly owing to the presence of opportunities pertaining to required customer profiles along with large open spaces the region turns out to be a competing ground for other Golf Training and Professional Clubs to effectively thrive in. Existence of other golf clubs along the region gaining same or equal opportunities happen to increase the competition for the Mere Valley Golf Club. Owing to the presence of avid competition there is an increasing threat of other firms to gain hold of any available resources present in the region. The other threat owes to the presence of wet weather conditions in the region that in turn makes it quite unstable for the business to sustain its profit growth and thereby to achieve the break-even. Objectives Short Term For the short term period the rate of customer flow needs to increase in the lean months or the wet seasons from 10 to 30 customers in an average manner taken on a day basis thereby enhancing the revenues gained from ?3000 to around ?6000 on a monthly period. The market share of the Professional Golf Club is also held to increase from 20 to 25 percent in the Short-Term period. Medium Term During the medium term the new building incorporated would be taken to be ready in terms of adequate replenishment of stocks, equipments and needed renovations rendered. Thus the business objectives would be to increase the number of customer entrants from around 30 to around 65 entrants during the wet periods on a daily basis. Moreover in the other months the renovated building would also help in increasing the entrants from 110 held during the short term period to around 150 in the medium term. Such enhancements in the footfalls would help the company enhance its monthly revenues from ?6000 to around ?8600 and market share from 25 to around 32 percent. Long Term Finally the long term business objectives of Mere Valley Golf Club in terms of average customer walk-ins on a daily basis is held to grow from 150 to around 185 on a daily basis. This rise in the average customer footfalls would help the company gain on additional revenues rising from ?8600 to around ?10000. Similarly the market share owing to the spontaneous and effective investments apportioned for designing marketing and promotional campaigns is held to increase from 32 to around 39 percent in the region. Development Plan of Indoor Teaching Facility Layout The layout of the indoor golf training facility to be duly renovated is held to consist of around 20 holed Golf Course. Further the indoor gold environment is to be adequately rendered a lush green texture to create a visual attraction to the entrants and visitors. Similarly keeping in mind the pattern of visitors to enter the golf club the establishment of a bar would further help in attracting and sustaining potential visitors. Other entertainment facilities can also be incorporated including video gaming zones and also placement of a billiard board. In addition to the above rendering of adequate number of restrooms in a mandatory fashion and sauna bath areas in an optional fashion also demands needful consideration. Availability of shelves and lockers should be made adequately for helping the people enjoy their stay out there (Marshall, 2010). Sandy McCarthy, the task owner of renovating and upgrading the building facility for building an effective indoor facility for Golf Training carried out an interview of another PGA Professional and a Member related to another club. The following information pertaining to the different headings are the inferences gained from the interviews conducted. Equipment Required The interviewees stated that the most essential equipments required for a professional golf training club encompasses the storing of different varieties of Golf Clubs and Golf Balls. Different types of clubs that need to be present include Woods that tend to have a big head for help in playing larger shots. Again Golf Clubs can also be designed of metallic heads like iron heads that tend to be flat and thereby help the golfer in playing more accurate shots. Similarly another type of a golf club like the Putters can be incorporated to help roll the ball on the green surface. These golf clubs tend to have a flatter face to serve the purpose. Golf balls can be both built out of harder or softer materials. The former ball on being hit can travel at a faster rate while the latter serves spinning motions. The average diameter and weight of a golf ball is held to be 1.68 inches and 1.62 Ounces respectively. Other Golf Accessories that would be required for the Golf Training Club to have consists of Golf Tees that contributes in raising the golf ball for playing more defined shots. Similarly the presence of adequate shoes, gloves to get effective grips and towels to cleanse the surface of the ball are also required to be adequately kept by the golf training club (CCH, 2008, p.28). Opening and Closing Schedules The operations of the Mere Valley Golf Club generally commences from seven in the Morning to Five Thirty in the Evening. However for the renovated building hosting the facility for indoor operations according to the interviewees the opening and closing time needs to range from seven in the morning to around seven thirty in the evening. Herein the people would gain additional lighting facilities to carry on with their training pursuits. Marketing and Promotional Activities Concept The activities related to marketing of a product or service focuses on the process of standardisation, preparing packages and working on product or service development. Pricing of the services must relate to organisational objectives and would be modified through use of discounts and credit terms. Again the service must be optimally distributed through physical and online channels to reach the target consumers. While promoting the service to the target consumers an optimal mix of activities related to advertising, public relations, creating hoardings and displays and also in participating in shows and programs must be duly incorporated (Jain, 2010, p.77-78). Inferences to the Interviews The PGA Trainer and the Member on being interviewed stated that in addition to the existence of adequate trainers some other tangible features like rendering of bars, restrooms and video and online surfing zones would help in enhancing the service package. Social networking enabled would help attract potential golfers to the club for gaining the opportunity to effectively socialise with their fiends involved in other clubs. Similarly the processing of the application of the new entrants need to be carried out effectively in lesser time and the initial ‘Test Fee’ structure must be made low to duly attract such. Again for the repetitive customers the fee structure should incorporate loyalty card and discounts schemes relating to special occasions like birthdays and anniversaries (Entrepreneur Press, 2008, p.35). Effective distribution systems to create consumer awareness of the newly created indoor golf training facility can be carried out through the blend of both online and physical systems. Online distribution of service packages of golf training courses and fee structure can be done through the use of a website created or through social networking ventures. Similarly the incorporation of third party agents can also be done to market physical brochures of the services to potential individuals (Reid and Bojanic, 2009, p.379). Similarly different types of Promotional Activities are reflected by the PGA Trainer and the Member that helped in gaining the right support and investment for effectively opening and sustaining their indoor training operations. The promotional activities consist of carrying out effective Public Relations with Sports and Borough Authorities and Investment Bankers to gain help of needed infrastructural and financial support. Similarly, the interviewees stated that potential advertising activities can be carried out in the digitalised environment through the use of televisions and online medium. In such a three dimensional advertisement can be framed of the renovated Golf Club to be shown in Sports and other Entertainment Networks. Use of Print Media like Sports Magazines and Newspapers need also be incorporated for displaying half or full page colour advertisements. The interviewees also recommended of organising chat shows on televisions to gain enhanced public awareness and also reflect on the services rendered through gaining membership in popular golf shows (Great Britain: Parliament: House of Commons: Welsh Affairs Committee, House of Commons, 2009, p.73). Staffing Plan Staffs Allocated The interviewees stated that various staffs need to be employed to carry out the training and refreshment services in the concern. Thus along with incorporation of professional golf trainers people responsible for rendering food and refreshments along with other accounts and administration staffs also needs to be included. The marketing and sales department of the club needs to be staffed in by people with specialised marketing and sales knowledge to effectively enhance the market share and revenue. Similarly other people need also be staffed that would take care of cleansing functions (Bailey, 2010, p.163). Working Hours The interviewees stated that working hours of the staffs would be divided based on two shifts. The first shift would commence from six in the morning and would end up at three in the afternoon. The second shift would start from eleven in the morning and would end up at eight in the evening. Staff Rotas Relating to week-off planning the interviewees mentioned that the staffs employed in the different departments whether related to operations or support and administration can be rendered offs on a specific day of a week. However such offs must not be given on Weekends owing to expectation of larger customer walk-ins. Incentive Plan The interviewees stated that special incentive schemes can be prepared for the trainers and the sales team depending on the amount of overtimes worked and the number of new and potential leads generated in terms of gaining effective customer groups respectively. Training Schemes Relating to training operations the interviewees mentioned that the skills and knowledge of the trainers can be enhanced through train-the-trainer programs such that the instructors can be introduced into understanding of the relation of golf with other sports like archery and martial arts. Similarly other certificate oriented programs can also be put in place while also involving yoga practices in the training schedule as part of the value-addition process (Bates, 2008, p.209). Health and Safety Standards The interviewees stated that the Golf Club needs to maintain health and safety standards relating to the pattern of food products rendered. The food products served must be produced in accordance to the health and safety legislations of the United Kingdom government. Moreover adequate toilet and parking facilities must be available in the clubs (Muller, 2012, p.22). Profit and loss projections This section of the paper focuses on the estimated three year budget for the new indoor teaching facility to be introduced by Golf Club. Initially, the Golf Club will have to distribute promotional brochures in order to publicize their new services. The brochures would comprise of details regarding the session and the related charges. Initially, for the first year Golf Club would require around 500 brochures to be printed. The use of promotional brochures has to be continued for the subsequent three years. In addition to this, the Golf Club will have to incur certain amount of capital expenditure for the development and proper implementation of the new service. Furthermore, the Club would also incur infrastructure and sales expenses for the introduction of the new service. The club would earn its revenue in the form of membership fees for the new service. The expected budget for the first year has been estimated as follows: Aspect Details Total per year (all values in pounds) Marketing Expenses Printing of Brochures – 200 pounds Design of Brochures – 50 pounds Seminar – 450 pounds. 700 Capital Expenditure Maintenance of golf indoor club and purchase of required accessories 30,000 Renovation expenses 10,000 Rent expense ?100/month 1200 Staff expense Annual salary of staff and trainers required to run the facility in addition to the incentive expenses 5000 Revenue 4500 pounds per month on an average in the form of member fees 54,000 Net Profit/loss (+)7,100 In the second year, it is expected that the revenue of the club is likely to increase with the rise in the number of new members in addition to old members opting in for the new service. With the rise in the number of members, the incentives earned by the trainers and sales team are also likely to increase. Thus, the estimated budget for the second year is as follows: Aspect Details Total per year (all values in pounds) Marketing Expenses Printing of Brochures – 200 pounds Design of Brochures – 50 pounds 250 Staff Expenses Annual salary of staff and trainers required to run the facility in addition to the incentives 7000 Rent expenses At the same rate as the first year 1200 Capital Expenditure Maintenance of golf club and purchase of required accessories 15000 Revenue 5000 pounds per month in the form of member fees 60,000 Net Profit/loss (+)36,550 During the third year, it is likely that the Golf Club’s revenue would increase further while its expense would remain almost the same as that of the previous year. Based on this assumption, the expected budget for the third year is a follows: Aspect Details Total per year (all values in pounds) Marketing Expenses Printing of Brochures – 200 pounds Design of Brochures – 50 pounds 250 Staff Expenses Annual salary of staff and trainers required to run the facility in addition to the incentives 10000 Rent expenses At the same rate as the first year 1200 Capital Expenditure Maintenance of golf club and purchase of required accessories 15000 Revenue 6000 pounds per month on an average in the form of member fees 72,000 Net Profit/loss (+)45,550 Cash Flow Forecast The initial setup cost comprising of renovation and appliance cost would amount to ?40,000. This amount would be borrowed from the bank as a loan and the loan repayment values have been considered while preparing the cash flow forecast of the Golf Club. (All Values in ?) Year 1 Year 2 Cash Flow from Operating Activities Cash Receipt from Clients 21600 25000 Cash Paid to staffs and suppliers (8640) (10000) Net Cash Flow from Operations 12960 15000 Cash Flow from Investing Activities Furniture and Equipments (2500) (1000) Replacement of old equipments 0 (6000) Proceeds 0 2000 Net Cash Flow from Investing Activities (25000) (5000) Cash Flow from Financing Activities Proceeds from contributed Capital 5000 6000 Loan Proceeds 15000 12000 Loan Payments (5000) (5000) Net Cash Flow from financing activities 10000 13000 Break-even analysis The major expense involved in starting the indoor practice club would be the innovation charges of ?10,000 and the cost of equipments, worth ?30,000. The other fixed cost involved would be the monthly rental expense of ?100. In addition to this, the institution of this facility would also require new sales staffs as well as trainers. Moreover, the Golf Club will also have to incur a certain amount of marketing and advertising cost. However, as it was observed from the profit and loss forecast that the training centre is likely to earn revenue worth ?4500 per month on an average, implying that its annual expected revenue would be ?54,000. Since the expected expenses would be around ?46,900, hence the Golf Club is likely to break very in the very first year of its operation. References Bailey, R., 2010. Physical Education for Learning: A Guide for Secondary Schools. London: Continuum International Publishing Group. Bates, M., 2008. Health Fitness Management: A Comprehensive Resource for Managing and Operating Programs and Facilities. United States: Human Kinetics. CCH, 2008. U.S. Master Depreciation Guide. United States: CCH. Entrepreneur Press, 2008. Start Your Own Information Marketing Business. United States: Entrepreneur Press. Great Britain: Parliament: House of Commons: Welsh Affairs Committee, House of Commons, 2009. Potential Benefits of the 2012 Olympics and Paralympics for Wales: Eighth Report of Session 2008-09; Report, Together with Formal Minutes, Oral and Written Evidence. United Kingdom: The Stationery Office. Jain, A., 2010. Principles of Marketing. New Delhi: F K Publications. Marshall, A., 2010. Golf Journeys & Culture. United Kingdom: eBookIt.com. Muller, C., 2012. Charity Golf Tournament Project Plan: A detailed project plan of a charity golf tournament. Munich: GRIN Verlag. Reid, R. D., and Bojanic, D. C., 2009. Hospitality Marketing Management. United Kingdom: John Wiley and Sons. Appendix Questionnaire Q.1. What are the best equipments that can be rendered to make the indoor training facility for the Golf Club quite effective? Q.2. What is the effective time schedule for opening and closing the indoor facility for the golf club to adequately service the customers? Q.3. What kind of service standardisation, packaging and pricing programs can be rendered to help attract potential customers? Q.4. What is the best process through which the service packages created can be effectively distributed to the target customer groups? Q.5. What kind of promotional campaigns would enhance the effect of attracting the right consumer groups to the facility? Q.6. What is the optimal staff allocation and work scheduling process? Q.7. What kind of incentive schemes are required to enhance the service quality of the trainers and the sales people involved in the golf club? Q.8. What kind of special training programs can be incorporated to enhance the skill sets of the trainers involved? Q.9. How cans the golf club focus on following the parameters of the health and safety legislations of the government in its activities? Read More