Category: Business
Golf is big business. The most recent figures shows that the golf economy comes to more than $60 billion. Compare that the movie industry’s $57 billion. That’s bigger than the Gross Domestic Product of Peru, Romania, Ukraine or Morocco. How big has golf become? In 1958, Arnold Palmer was the PGA Tour money leader, with $42,000 in winnings. In 2005, Vijay Singh won a little over a million in just two tournaments. This section is devoted to the business of golf.
Golf Watching Up, Playing Down
Fox Sports reports that while attendance and viewership for golf is up, the number of rounds played peaked in 2000. It seems that the Tiger effect is wearing off, as people find that it’s not as easy as he makes it look.
Then there’s the fact that it’s not an easy game to get into:
“The game is difficult, expensive and requires an extensive time commitment,” said Casey Alexander, a scratch golfer who covers the golf industry for Gilford Securities in New York. “Facilities are hostile to the newcomer, and other participants are hostile to the newcomer. If you’re bombarded by hostility in your first year of playing the game, you’ll go bowling.”
Couple this with the expense, a general economic downturn over the last few years, and the time involved, and it turns out that golf loses two out of every three new players in a year or two.
I think that the PGA (the teachers and course managers) have really got to work on this one. The expense and time things are not solvable, but the hostility on the course is. Golf simply needs to be more welcoming to new players.
Another Way To Get Into The Golf Business
There are a lot of ways to get into the golf business short of being a golf pro. You could be a blogger, like me (although there’s not much money in it—certainly not enough to quit your day job). Or run a golf store. Or a groundskeeping business.
In Minnesota, a guy named Scott Lokken dives in ponds for golf balls, and then sells them on Ebay. He works 5 days a week, scouring the bottom of the ponds of 35 courses. On an average day, he extracts 5,000. The course gets a cut and the rest, he sells on Ebay.
If The Deal Seems Too Good To Be True, It Probably Is
There is a huge problem right now with Chinese knockoff of name brand equipment. If you look at the listings on Ebay, you will find a lot of clubs listed as TaylorMade or Callaway or Titleist at unbelievably low prices. While it could be somebody dumping his excess, its also likely that they are imitations made from low-quality alloys.
The ironic thing is that a majority of real clubs also are made in China.
Golf Galaxy Sets IPO
Golf retailer Golf Galaxy has set its initial public offering at 3.3 million shares to be sold for $11 to $13 a share.
Callaway’s Second Quarter Below Forecasts
Reuters is reporting that Callaway Golf’s second quarter was below forecasts. Callaway, however, says that
There apparently are several issues here: one, related to the purchase of Top Flite, and the other:
The maker of the Big Bertha line of clubs is struggling to regain market share from its rivals like Adidas-Salomon’s (ADSG.DE: Quote, Profile, Research) TaylorMade, whose lower-priced models have cut into Callaway’s profits.




