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Home My WebLink AboutCSD-11-107 - Golf Enterprise Proposed 2012 Membership Fees1 KITCx~i~~R Staff Re ort p Camrn unity Services Departm ent ~w.k~~~~~r~erca REPORT T0: DATE OF MEETING: SUBMITTED BY: PREPARED BY: WARD(S) INVOLVED: DATE OF REPORT: Community and Infrastructure Services Committee September 26, 2011 Keith Baulk, Director of Enterprise, 2393 Kim Kugler, Manager of Aud/Arenas and Golf, 2544 N/A September 16, 2011 REPORT NO.: CSD-11-107 -REVISED SUBJECT: Golf Enterprise Proposed 2012 Membership Fees RECOMMENDATION: That the golf enterprise membership fees as outlined in report CSD-11-107 be adopted for the 2012 golf season BACKGROUND: Last year, unlimited play golf memberships were reintroduced after being eliminated approximately 14 years ago. The unlimited memberships where reintroduced for 3 reasons as follows: 1. The new inventory of golf opportunities at Doon Valley Golf Course gave staff the impetus to review the overall golf operation with a goal to maximize use of the new facilities and hence revenues through increased play. 2. The golfing public (both current members and potential new members) asked the City to consider reintroducing unlimited play memberships in 2011 as many of our competitors had unlimited play packages. 3. Recently, we are experiencing more unstable weather patterns thereby affecting "pay as you play" type golf operations. One fee memberships guarantee a base annual revenue regardless of the weather. REPORT: The reintroduction of the unlimited play membership was extremely well received as evident in the number of golfers who purchased unlimited memberships in 2011 (and the resulting revenues associated with these memberships). Unlimited play memberships were supported based on quantifiable targets that were set that would see an increase in overall membership revenue associated with this change. We are pleased to report the overall target was exceeded 9-1 1 Staff Report Krr~.~-~~,i~iER CommunityServicesDepartment www.kitthenerta (see membership target matrix attached as Appendix 1) and as a result, staff are proposing unlimited play memberships should continue for 2012 and beyond. It is important to roll out the 2012 membership packages now as competing privately operated courses offering unlimited play membership packages have begun to roll out their 2012 membership program. As a result, many of our current members and potential new members are inquiring about the City golf course rates for 2012, In order to stay competitive, the City should roll out 2012 membership rates as soon as possible. Attached as Appendix 2 are the proposed 2012 membership rates. Staff is proposing the 2012 membership rates be held at the same level as 2011 as an early bird offer and that we increase all membership fees after December 15, 2011 by approximately 3%. Holding rates for early purchasers is a common practice in the golf industry. It should be noted that last season's early bird registrants received either $50 or $25 gift cards which staff are not proposing for 2012. So in essence, there is a defacto increase for some members who register early for the 2012 golf season. The one exception where fees will be increased is for cart memberships. Cart memberships were extremely popular and in staff's opinion, there is capacity for a small increase. The increase proposed is 4%. Staff are also proposing a new single rider fee for golf cart members to reflect the fact only one person is using the cart (note this aligns with the single rider fee at a higher level for non cart members). Finally the fees being proposed will include a handicap tracking system, but not necessarily the Golf Association of Ontario (GAO) system. Staff is currently investigating less costly options. As a further piece of information, staff has attached a matrix showing 2012 membership fees from area golf courses. In some cases 2012 fees were not available so 2011 fees are shown. It is attached as Appendix 3. ALIGNMENT WITH CITY OF KITCHENER STRATEGIC PLAN: The recommendation for the proposed fee structure aligns to the Effective and Efficient Government Priorities, specifically Finance Management. FINANCIAL IMPLICATIONS: The 2011 membership targets were achieved demonstrating a very high level of interest in unlimited play memberships. As a result it is expected there will be an increase in the number of members in 2012 resulting in new revenue. Once again quantifiable targets will be set for 2012 as part of the budget process. In fact we may need to consider membership caps in some categories in the future. Any revenue collected in 2011 as part of the 2012 membership drive will be accrued as 2012 income. In addition, we expect some of the current and new members will purchase memberships after the 3% increase on December 15, also resulting in additional revenue. 9-2 1 Staff Report Krr~.~-~~,i~iER CommunityServicesDepartment www.kitthenerta COMMUNICATIONS: Members and the public who have signed up for the weekly Kitchener Golf specials notification will receive 2012 membership pricing information through direct email. Individuals without an email address will be able to receive details from the offices at both golf courses. All the membership pricing will be made available to the public on the Kitchener Golf website. Other marketing initiatives will be developed in conjunction with the Communications Division. ACKNOWLEDGED BY: Jeff Willmer, Deputy CAO, Community Services Department 9-3 1 KITCx~i~~R Staff Re ort p Camrn unity Services Departm ent ~w.k~~~~~r~erca APPENDIX 1-Membership Target Tr~~t ~I~ ~ ~~t~ I +,~ - ~t~~~~~r~F~l ~~ ~ ~t~~~rl,~~ Tt~r~t ~ ~~ ~~~~r~ Tt~r~~t~ F~~~f~t~4~L ~ * ~I ~~ . ~~~~r~u~~~ t~ ~~t~ ~ ~1.4~~~f~lc~~u~~ ~~. T~r~~t .." t~~ ~~ ~f Tt~r~~:t. 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