Times are tough everywhere. The once free spending customer with unprejudiced taste has turned into a tight fisted, penny pincher. Disposable income is being significantly scrutinized by our customer base in golf, and fewer people are walking through our doors; patrons and employees alike. Here are some proven tips to help you survive the tough times.
1. Convert hardgoods from a major profit centre into a service.
Match your equipment prices with online stores and gain the trust and future business of your customer base. Make your margins on softgoods, especially impulse items, and increase the traffic in your shop. You always want the leverage of being the resident expert. If they are going to someone else only because your price is higher than you lose your position.
2. Become the expert; be the place they come to for answers.
This is related to the previous point. There is a lot of information out there. Be the collector of it and be known as the go to guy for all information that is golf. You don’t have to be the expert on everything, but if you can gain the trust of people in one area; teaching, equipment, or rules, they will more often than not trust your opinion in other areas too. In times of uncertainty, people gravitate to things they trust.
3. Trim the fat.
Cutting back on services or items is always a difficult decision, but remember that it must not ruin the experience. Small disappointments can be overshadowed by great experiences. Make sure the things you eliminate do not endanger the experience you need to deliver. One of my favourite quotations is “people will not remember what you said, or what you did, but they will always remember how you made them feel.”
4. Law of Diminishing Returns.
Find your healthy balance on price, but don’t give it your stuff away. The object of your business at this time should be squarely focused on increasing traffic and driving them to profit centres. Make sure you reflect on the long-term effects of price cutting or conversely standing pat on price. How will your business be looked upon by your customers in 12 or 24 months after a price change? And does it allow you to easily attain pre-2008 pricing levels?
5. Smallest things make the biggest difference.
Focus on mastering what you can. Attention to detail and presentation, making sure the staff is respectful and engaging, or providing a cold wet towel on a hot summer day are all inexpensive ways to keep expectations and experience high without breaking the bank.
6. The basics about basic softgoods.
I’m not sure what the experts are saying, but I can tell you from my experience that fashion items are moving a lot slower than basics. You can still have a shop with “pop” without going crazy on items that are borderline home runs. Solids are always in style, can be carried over, and often times remerchandised with other collections. In essence, they have a longer shelf life than fancies. To give your shop some variety, try bringing in more collections with fewer items. This allows you to change your shop more frequently and help drive the curious customer into your shop.
7. Watch your inventory and have an exit plan.
Before the next buying season, investigate your inventory exit plans. Work with companies that will do consignment, are willing to trade out inventory, or have smaller minimums. There are businesses as well that will sell your old inventory for you. You may not get a lot for it, but it’s more than you’ll get for it sitting in a box in your storage area. Lastly, adjust your pricing on softgoods to make a healthy profit while focusing on increasing turn rates.
8. Ramp up the kids stuff and impulse items.
It is a fact; one of the last areas people will cut back their spending is on their kids. Take advantage of this and expand your kids line. Kids clothes are not as fashion sensitive, so inventory can be carried over year after year without going on the sale rack. That goes for low-cost, impulse items too; hats, logo balls, key chains, etc. And make them visible, display them in high traffic areas and priced to give yourself a healthy profit. These are major profit centres for you now.
9. Increase camps, classes and other less expensive options for golfers.
People will be less likely to spend the bucks on a private lesson. But if you can give them a cheaper alternative that is close to the real thing, you may have a chance to expand traffic at you club.
10. Use Free Marketing!
There has never been a cheaper way to advertise in history than right now. Twitter, Facebook, Flickr, and other blogs and social networking platforms are the virtual word of mouth. Get your name out there. Inform your patrons. Better yet, involve them and make them feel that they have a vested interest in making your club great. Pride sells logos!
June 18, 2011
Growing Your Golf Business