Chicago Golf Market United States Golf Market 2008 With 2010 To 2014 Projections Data Trends Report Zpryme
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Chicago’s Golf Market is Thriving While the U.S has Entered the Declining Stages, Where Efficiency and Innovation are Imperative|LEARN MORE BELOW Chicago, IL (ZPRYME NEWS) – 09/23/08 – “No one does it better.” According to Chicagoland Golf research, no single market in the U.S. has opened more golf courses in the last decade in such a small geographic region than greater Chicago area. However this leading position should be mitigated by the well known fact that the golf industry’s life cycle in the U.S has entered the declining stages, where efficiency and innovation are imperative. Although the golf industry worldwide is growing between 5-15% in countries like Korea, Japan, India, China, Germany, the U.K., and South Africa, the U.S. golf industry as a whole finds itself in the mature or declining stages of its life cycle.2 Not surprisingly, it faces more and more golf course closures than course openings. Unlike its counterparts abroad, which reflects characteristics of a mature market. However those businesses which remain in this industry may discover segment niches where viable opportunities exist to better serve existing golfers, whether core or occasional players, who had previously been underserved, as well as potential new players. The initial growth spurts the industry experienced took place in the How well do you know your consumer?
1920s, and then culminated with 16,057 golf courses in 2004.3 The current U.S market conditions include the following characteristics:
12,000 golf courses generating a combined annual revenue of about $18 billion. 25% growth in golf courses throughout the U.S. during the 15 years preceding 2004. 80,000 to 100,000 rounds per year can be played throughout the year in warm and dry places like Florida, Arizona or Southern California, but the average course in the US hosts an average of 30,000 rounds per year due to adverse winter weather. In 2007, rounds were relatively flat. Rounds demand: not going up, but not going down either; it is remaining stagnant. Although rounds played have been increasing since 2003, growth is relatively flat (about a 1% annual increase). 2006 and 2007 were the first years in history that the industry had a net reduction in supply. Openings and closings for 18-Hole Equivalent Course (EHE) in 2007 balanced out (0.1% reduction in supply); 2006 – 120 courses opened; 146 closed. 2007 – 113 courses opened; 122 closed. About 70% of US courses are open to the public. Private courses get revenue mainly from annual
September 2008
memberships, public courses mainly from daily fees. Membership dues account for a third of industry revenue; activity fees (“green fees”), 25%; food and drinks, 35%. About 3,000 courses, with $7 billion of revenue, are owned by non-profit entities such as municipalities and private clubs. Within the commercial segment, the 50 largest companies account for only about 25% of the market. Large companies include ClubCorp and American Golf Corp and maintain an oligarchic market position. The industry is clearly and highly fragmented. The U.S. golf economy generated $76 billion worth of goods and services in the year 2005. This represents an average annual growth rate of 4.1% since 2000 ($62 billion), and primarily reflects growth in golf facility revenues, real estate, and golf-related tourism. U.S. Golf Courses & Country Club Revenue (USD Million)
$25,000 $24,000 $23,000
$23,215
$23,603
$24,021
$24,394
$22,439
$22,000 $21,000 2010
2011
2012
2013
2014
Source (Update): IBISWorld, Golf Courses & Country Clubs in the US, 2009
Consumer Insights | www.zpryme.com |1.888.ZPRYME.1
SNAPSHOT
Zpryme delivers relevant, actionable insight and consultation specific to each client’s individual needs, helping organizations solve immediate business problems and achieve long-term success. Market Research & Consulting Has Evolved… Services: Advisory, Business Plans, Buzz Research, Consumer Insights, Market Research Practices: Branding Solutions, Generational Insights, Going Green, Multicultural Insights, Mobile Insights, Social Media Insights Contact: +1 888.ZPRYME.1 | [email protected] | www.zpryme.com Copyright © 2009 Zpryme Research & Consulting, LLC All rights reserved
1920s, and then culminated with 16,057 golf courses in 2004.3 The current U.S market conditions include the following characteristics:
12,000 golf courses generating a combined annual revenue of about $18 billion. 25% growth in golf courses throughout the U.S. during the 15 years preceding 2004. 80,000 to 100,000 rounds per year can be played throughout the year in warm and dry places like Florida, Arizona or Southern California, but the average course in the US hosts an average of 30,000 rounds per year due to adverse winter weather. In 2007, rounds were relatively flat. Rounds demand: not going up, but not going down either; it is remaining stagnant. Although rounds played have been increasing since 2003, growth is relatively flat (about a 1% annual increase). 2006 and 2007 were the first years in history that the industry had a net reduction in supply. Openings and closings for 18-Hole Equivalent Course (EHE) in 2007 balanced out (0.1% reduction in supply); 2006 – 120 courses opened; 146 closed. 2007 – 113 courses opened; 122 closed. About 70% of US courses are open to the public. Private courses get revenue mainly from annual
September 2008
memberships, public courses mainly from daily fees. Membership dues account for a third of industry revenue; activity fees (“green fees”), 25%; food and drinks, 35%. About 3,000 courses, with $7 billion of revenue, are owned by non-profit entities such as municipalities and private clubs. Within the commercial segment, the 50 largest companies account for only about 25% of the market. Large companies include ClubCorp and American Golf Corp and maintain an oligarchic market position. The industry is clearly and highly fragmented. The U.S. golf economy generated $76 billion worth of goods and services in the year 2005. This represents an average annual growth rate of 4.1% since 2000 ($62 billion), and primarily reflects growth in golf facility revenues, real estate, and golf-related tourism. U.S. Golf Courses & Country Club Revenue (USD Million)
$25,000 $24,000 $23,000
$23,215
$23,603
$24,021
$24,394
$22,439
$22,000 $21,000 2010
2011
2012
2013
2014
Source (Update): IBISWorld, Golf Courses & Country Clubs in the US, 2009
Consumer Insights | www.zpryme.com |1.888.ZPRYME.1
SNAPSHOT
Zpryme delivers relevant, actionable insight and consultation specific to each client’s individual needs, helping organizations solve immediate business problems and achieve long-term success. Market Research & Consulting Has Evolved… Services: Advisory, Business Plans, Buzz Research, Consumer Insights, Market Research Practices: Branding Solutions, Generational Insights, Going Green, Multicultural Insights, Mobile Insights, Social Media Insights Contact: +1 888.ZPRYME.1 | [email protected] | www.zpryme.com Copyright © 2009 Zpryme Research & Consulting, LLC All rights reserved
