Case Study Findings
Based on the following information, what are your conclusions regarding?
* Is the market over or undersupplied?
* If so, by how much?
* Within 10 minutes there’s 5,004 people per 18 holes
* Within 20 minutes there’s 4,818 people per 18 holes
* Within 30 minutes there’s 3,814 people per 18 holes
* Are the age, income, ethnicity, and population density conducive to golf? * Yes, the area that the course is located at yields a high income average compared to the U.S. average. * 73.4% of the population that play golf are Caucasian within 10 minutes. Only increases to 77.7% within 20 minutes * I feel we are at a disadvantage though because the average age is 37.6 within 30 minutes. * Which of the characteristics reflects the greatest strength or weakness in the market? * Some of the strengths in the market are: that the population in the area has a higher income rate and within 10 minutes the ratio of people per holes is 30,024 to 108. * One of the weaknesses is that the average age is 37.6 which would decrease the amount of players during normal business hours. * Based on the conclusion, what is your preliminary conclusion regarding the green fees charged versus the customer demographics? * 50% of the courses within 10 minutes charge less than $40 and the customer demographics would show that the average person could afford to pay a higher premium for a round of golf but doesn’t necessary mean that they will pay that higher fee. * At a first glance, should one of the courses be closed or is renovation of one or both courses desirable? * Yes, the Wind Couse should be closed due to the fact is has too many problems and would be too expensive to renovate. Renovation of the Earth Course would be a great idea because that course already brings in an average of 42,946 rounds per year and with a little work could increase that number.
* The chart shows that in the years of 2007 to 2008, there is significant drop in revenue. While a majority of that is due to the weather, we feel that the lack of proper management is also a factor to the drop in revenue. With the management knowing that there will possibly be less playable days, the management could have taken proactive measures to better the revenue ratio.
* With the numbers above showing that in 2007 we lost almost a million dollars due to weather. What that means is the due to rain or extreme temperatures we could not get customers out on the golf course. In 2008 we lost almost as much money as we made. As you can also tell, there was almost a million dollar drop in gross revenue from one year to the next. With what we are suggesting, we think that rack rates can be raised to help minimize the lost revenue. Also the management needs to better schedule the employees that will help with that issue.
* We feel that if more tournaments are scheduled on playable days, which will greatly increase the revenue of the golf facility. Not only will the number of golfers exposed to the golf course but the food and beverage revenue will show a steady rate of increase.
* We need to do a better job of gathering and tracking information of our customers, or at least obtaining contact information so we can improve on our marketing. Of our 90,299 regular customers over the last few years, we only have e-mail addresses for 15.13%. Even our permanent time holders, we only have 80% of their contact information and gold card members are only 76%. These are our most frequent customers so it would be beneficial for us to keep in contact with them. Our ladies league, banquets, and golf outings all have 100% of their contact information, so it shouldn’t be too difficult to get a system set up for our regular customers, permanent time holders, and gold card holders.
Customer Spending By Class
* About ¾ of our...
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