Is the golf business coming out of the bunker?
For those of you grappling with the OCR A2 F297 Strategic Management case study (like us at T2U), the golf business might be on the list of things you’re wondering about. Or maybe you just think about golf anyway. As usual, the BBC is packed full of interesting background on the business of golf.
I’ve been especially interested to check out the link between the economic climate and the fortunes of the business. I picked up on golf equipment sales and learned that the golf equipment business is hoping to bounce back – the good times came to an abrupt end in 2008. In 2009 and 2010 Callaway Golf (a big equipment company) had revenues that were about 15% less than in 2008 and it recorded losses as the recession hit the golf equipment industry hard.
New expensive clubs were easily-identifiable “discretionary expenditure” for golfers, causing spending to dive. And the economic downturn affected rivals too: in fact, industry-wide equipment sales have declined by about 18% since 2007. But it appears that all of the equipment product categories have bottomed out and sales are now recovering.
And what about playing the game? The 12-month rolling decline in golf ball sales coincides closely with the decline in rounds played, which according to the US National Golf Foundation reached a peak of 532.3 million in 2006. Statistics also show that mid-2009 marked the worst of the recession for the golf equipment industry.
A final quote is interesting: “the overall economy must improve considerably before rounds played or equipment sales are likely to return to the 2007 levels”.
If you want to find out more there’s an article and video clip at Masters provides golf business benefits for Augusta and good evidence of growth in ‘Other’ markets.
But best of all is Global golf industry facing challenges which you must read if you’re preparing for the OCR A2 case study.
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