The Retail Tradeoff

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Congressional Country ClubIncreasingly, golf shops at club and resort properties are expanding their inventory to reflect a much broader retailing perspective.

The offerings at many golf course pro shops have expanded over the years to include goods that have little to do with the game of golf. Pajamas, boxer shorts, home goods and accessories are now all common finds on pro shop shelves these days.

At the pro shop at Half Moon Bay (Calif.) Golf Links, for example, the necessary stuff—balls, drivers, putters and wedges—can still be found, but the shop’s retail focus is no longer on golf equipment. Instead, selling logoed apparel to out-of-towners is now the shop’s bread and butter, says Kevin Niessner, Director of Golf at the 36-hole resort course.

SUMMING IT UP

  • While pro shop managers are carrying a more diverse inventory, they’re cutting back on some of the basics, making for less total inventory than when the economy was more robust.
  • Consider running specials to coincide with club events.
  • Rotating inventory on a regular basis can keep things fresh and sustain customers’ interest.

But as pro shops expand to reflect a much broader retailing perspective, with an increased emphasis on apparel, furnishings, keepsake items and other specialty items, their managers are finding that something else has to give—and items in other retail categories have to go—to keep an operation in the black.

“I think it’s always good for a shop to try to appeal to as many different factions of people as they can, as long as they balance that with a manageable inventory level,” says Chad Newton, Head Golf Professional and owner of the pro shop at Pinewood Country Club in Asheboro, N.C. “With the golf business being in a semi-recession, it’s more important than ever to keep a close watch on inventory levels. If you branch out into a new category, such as home items or personal products, then you have to cut inventory from somewhere else.”

Newton began cutting back on Pinewood CC’s inventory in the fall of 2007, when he started to see a slowdown in business. When the recession hit in 2008, and other shops found themselves flooded with inventory, Pinewood CC was already in conservative mode. Since then, Newton has found that it’s more important than ever to keep close tabs on average inventory and its rate of turnover.

Half Moon Bay has also trimmed its inventory in the past couple of years, Niessner says, mainly because of the recession.

“You may lose out on sales because there’s less to sell, but it keeps your inventory levels in line,” Newton notes.

When shoppers consider other factors like customer service and quality in buying decisions, pro shops have the ability to highlight a variety of other features that help them stand out from the competition.

Purposeful Purchases

As the economy limps toward recovery, members and guests are beginning to buy in pro shops again.

“People love to spend money,” Newton says. “As retailers, we have to give them an excuse to do so. It’s all about having a unique item, or extending an offer they can’t refuse.”

Part of his strategy is to make spending coincide with a guest’s purpose for being at the course. Newton finds it beneficial to run specials in conjunction with tournaments or other member events.

“When we have parties for a couple hundred people, I offer a discount to capitalize on that opportunity,” Newton says.

Congressional Country Club in Bethesda, Md., has the good fortune of hosting the U.S. Open this year, which will mean a boost in pro shop sales from two new types of customers: those seeking apparel that bears the Open logo, and tournament enthusiasts who will be visiting Congressional for the first time and wanting gear adorned with the club’s logo.

Regular yearly events can also offer special sales opportunities. Half Moon Bay capitalizes on the holiday season by hosting a sale at the beginning of December each year. Congressional offers holiday specials—and gift-wrapping as well—but the club goes a step further for Presidents’ Day.

“Presidents’ Day is a big deal here, because five U.S. presidents founded the club,” explains John Lyberger, PGA Director of Golf and head of Congressional’s retail operations. The shop runs a U.S. President trivia contest in the club’s newsletter, and offers pro shop gift cards to the winners.

“Any time you can draw attention to your operation, it gives you another opportunity to make a sale,” Lyberger notes.

Finding ways to appeal to all market segments has also taken on added importance in a tighter economy. Half Moon Bay recently added a line of less-expensive clothing to attract more customers.

“Customers are very price-sensitive,” notes Neissner. “We’re doing our best to satisfy customers at varying price points, instead of only offering high-end items.”

As members open up their wallets for more discretionary purchases, pro shops will begin to believe that the worst may be behind them.

Keeping Up Appearances

Retailers generally agree that how a shop looks can have an impact on sales as well. To this end, some clubs are embarking on shop renovations to try to energize sales activity.

Gaining Loyalty

Loyalty programs have been shown to encourage spending at some clubs’ pro shops. At Half Moon Bay Golf Links in California, the men’s, ladies’, homeowners club members and rewards members receive a discount in the pro shop. Rewards club members pay a $400 fee to sign up, and they can earn free rounds for spending certain amounts of money in green fees and merchandise. The higher the points, the more prime the tee time is that they earn.

“About one in every six rounds is free” for rewards members, says Kevin Niessner, director of golf at Half Moon Bay.

PGA National Resort & Spa, in Palm Beach Gardens, Fla., recently completed a comprehensive reinvention of its pro shop as part of the resort’s $65 million renovation. The changes included new carpet, granite countertops and up-to-date fixtures, all designed to give the operation a more contemporary feel. The new 2,200-sq. ft. shop also features separate check-in areas for visitors and private members, to make the shopping process more efficient and guest-friendly.

If capital funds aren’t available for a total renovation, less elaborate makeovers can still be effective. At Half Moon Bay, Niessner tries to change how items are merchandised once a week, to keep the shop’s appearance fresh and take advantage of “sweet spots” on the selling floor.

“We have certain flows and fixtures in the shop, based on traffic patterns, that tend to sell a little better, so we try to rotate what’s positioned in these spaces,” he explains. “Ultimately, we want to create an atmosphere that satisfies our diverse membership. If members are comfortable, they’ll be more inclined to spend their hard-earned dollars with us.”