Golf Course Management as a Franchise Model – A One-Time Opportunity

I’m fascinated by what seems to be a normal thing in the golf management industry – That a lot of golf facilities refuse to display their golf management company logo on property.

This is crazy to me and really an amazing opportunity right now I believe.

The entire golf course management industry seems to be confused about what constitutes a DIFFERENTIATOR versus things that are just table stakes to get into the game.

Here’s what I mean. Every single management company out there is selling improved operations, expense savings, buying power, and expertise. If you don’t have these things, you can’t call yourself a real management company.

Those things are what convince golf course owners to hire A golf management company…not YOUR golf management company.

So what’s the difference between one company and another? Right now, not much. Down the road, it’s going to be 100% predicated on BRAND.

Here’s why…

So, I compare the value proposition for golf management to be a lot like a franchise model.

So, there are two big reasons that someone starting up a new restaurant would choose to buy into a franchise…Think Subway, Outback, or McDonald’s:

1. Efficiency: On one side, the processes, operating efficiencies, buying power, and access to resources and expertise. They’ll get up and running quickly, and with a lot less brain damage than if they had gone it alone and they can run a tighter ship.
2. Brand Recognition: They know that they’ll win business on day 1 that they wouldn’t have otherwise won if they had started out as Jimmy’s Hamburger Shop.

Done right, the brand part of buying into McDonald’s is far more valuable than their processes for making hamburgers.

Nobody would dream of buying into the McDonald’s franchise without stamping the logo everywhere on property.  I know it’s not allowed. The logo is the biggest reason people buy into the franchise anyway…

The marketing is done for you, everyone knows the value proposition, what they’re going to get, cost structure, and everything else. Buy into Subway, and you’re going to have people in your store on day 1.

In golf management, from the club’s perspective, it’s totally understandable. The club’s brand and logo simply carry more weight in the local marketplace. If the management logo isn’t bringing any value to the club, why would they want it?

But…the minute a management company’s brand begins bringing direct value to the facility, meaning bringing bodies in the door, clubs will line up to buy into that ecosystem and capitalize on the attention.
That’s when the scales tip for the management company. Until then, it’ll be a battle to get the name on the door.

I really believe the “land grab” for market share that we’re seeing right now in the golf management industry is going to predicated on strength of brand rather than who’s got the best “processes” or “buying power”.

Given the state of the golf industry, I also believe that the winners are going to snuff out the losers over the next 10 years. We’ll see a bunch of consolidation…the lucky ones will get bought out, while the unlucky ones will just go quietly out of business.