The hunt for lost revenue

The depth of information provided by 59Club’s benchmarking and analysis is intriguing and, as director Matt Roberts shows, it can provide a catalyst for change and increased revenue.

Unless your internal systems are letting you down, you will be fully aware of the number of buggy hires your club makes in any given month. Let’s take that as a ‘given’. What you may not be aware of, however, is how much revenue you’ve missed out because of your staff’s reticence to ‘upsell’. And this is why 59Club developed its ‘service calculator’, which using a number of simple formulae, will give you a good indication of the revenue you’ve still to tap into.

It’s not as complicated as it looks and, once you’ve got used to filling in the simple forms, it will provide you with some thought-provoking figures. The calculator takes many factors into account and is still based upon the mystery visits carried out by 59Club. It looks directly at the ability of staff to sell and takes into account, availability, pricing and the probability of sale.

Over the next four months we will be showing how, with a little bit of effort, and the 59Club service calculator you can highlight areas in which you are not maximising your opportunities – and also use that data to improve your bottom line in the future.

This month we’re looking at the arrival in the pro shop and checking in for a tee-time.

Figure 1 illustrates the minimal detail which needs to be entered online. Here we have completed it with some illustrative – but not unreasonable – figures by way of an example.

We can assume there are few attempts to upsell to members, who would – quite reasonably – balk at being asked if they wished to hire a buggy every time they went out to play. So here we concentrate on visitor rounds with an example of 1,500 for June.

Pricing and availability – generally the fleet size – is straightforward and requires nothing by way of explanation. However, the adjustments will require clarification and a modicum of maths skills to understand. The first factor in the adjustment is the calculation of the fleet size across the month. Let’s say, for example, we lost three days in June because of adverse weather – not an unlikely scenario in the UK.

Three out of 30 days equates to ten percent of the month where buggies were not available to be upsold. Ipso facto, they were available 90 percent of the month – and it’s that figure we will return to in a short while.

The next factor we’ll look at is, once again, a common one: buggy maintenance. Three buggies out of a fleet of 15 to maintenance issues means that 20 percent of them cannot be hired out – therefore, we have 80 percent availability.

The third scenario to take into account in this example is one which is quite conceivable, particularly if you host regular corporate or society days: pre-bookings. Again, let’s say that there are three days in the month when the buggies are completely booked up – that equates to 90 percent of the month when buggies were available to be hired.

The fourth and final scenario we will look at here is applicable only in the summer months when we have extended daylight hours, enabling a number of buggies to be hired out twice in the same day. Let’s say three buggies, from a fleet of 15, are able to be re-hired in the afternoon, for 10 days.

So, for 10 days we are hiring out 18 buggies; on the other 20 days we have available all 15. And this is where the first of the maths testers appears. We have 180 buggies (18 x 10 days) plus 300 (15 buggies x 20 days) for a total of 480; which means we are working at 106.6 percent of capacity. So the adjustment here is, on this occasion, a positive one of 106.6 percent.

So, after taking into account those four scenarios, we need to calculate the final percentage adjustment. And this is where that mathematics GCSE really comes into its own – despite the fact your friends told you that you’d never need maths in real life!

We need to multiply those percentage figures – never adding or subtracting. So we have 90 x 80 x 90 x 106.6, which equals – drum roll please maestro – an adjustment of 69.07 percent. So that’s the figure that gets placed in the adjustment box.

The purchase percentage adjustment is marginally simpler to work out: when you look somebody in the eye, with a genuine reason for sale, and the desire to convert, how many will buy? One in four? Then it’s 25 percent.

The final ‘arrival’ figure is calculated and inserted into the overall summary, along with figures reflecting performance in the pro shop, off-course F&B, and on-course F&B. That calculation can then be quantified as in the example shown (Figure 2).

As with all 59Club products, the calculator allows for like-for-like comparisons with selected competitors, the industry average, and the best-performing clubs from an up-selling perspective.

And, what those figures will show is – like the elusive prize in Bullseye – what you ‘could have won’. It’s the revenue you’ve missed out on because of missed opportunities in upselling, which in the example in Figure 2, is a not-insignificant £2,250 for Club A. And, elsewhere in the table, the figures show how Club A is also underperforming when compared with the industry average and chosen competitors, among others.

Obviously at first reading this is quite complex. That’s why for 59Club clients we provide simple guidance notes on the online data entry tables which can be found by clicking on the entry boxes. They explain the process that will need to be undertaken before entering any data.

The industry experts at 59Club are on hand to provide support and assistance for all golf and leisure businesses keen to develop customer service and sales systems. Its products and insight provide measurable indicators which allow you to exploit every opportunity presented to each department within your club, from the sales team, front-line operators and those responsible for member and visitor retention. To discuss your business requirements call 59Club on 01530 440 004.