WGC and Covid-19 Update - April 15

Member feedback from our last article has been positive, so this week we’d like to discuss our second scenario—open the golf course in July but not the Clubhouse.  Before examining the numbers, it’s important to restate that this scenario requires the provincial health authorities to amend their current rules and allow golf to be played in Ontario. We are assuming that when this happens there will still be restrictions on a number of things.

Here are the underlying financial assumptions we’re using. They are not a comprehensive list of actions and are listed here so you understand how we did the arithmetic. 

• No access to or food & beverage in the Clubhouse
• Beverage carts available with limited, pre-packaged food
• No Back Shop club storage
• No outside golf events
• Guest rounds at 50% of normal
• Power carts at 50% due to single riders

Based on these and other assumptions, the following are the forecasted numbers by category. They are all stated as increases over the same amounts from last week’s “no golf” scenario.

Revenue up $355,000 – This is largely from power cart and guest revenue, as well as food and beverage sales from the beverage carts, plus some Pro Shop sales.

Greens Expense up $293,000 – This reflects the increased wages to prepare and maintain the golf course in proper playing conditions.

Food & Beverage Expense up $132,000 – This is the wages and supplies expense necessary to generate the food and beverage sales noted in the revenue numbers above.

General Administration Expense up $37,000 – This is a summation of a number of subaccounts which would all increase by a small amount.

Pro Shop Expense up $47,000 – This is the cost of goods sold plus some added staff costs.
Clubhouse Expense up $5,000.

As you can see, the added expense to start playing golf in July is about $514,000—more than the $355,000 in added revenue. Total revenue and expense are even closer together in this scenario.

In addition to getting the golf course ready, we are having discussions on how we will be able to play golf safely while observing guidelines that will be mandated by the provincial health authorities.
Most golf associations have suggested approaches to follow, so we have an abundance of ideas already! It remains for us to find out when and how we can do this, after which we will let you know what we have concluded.

Mark Crerar

President