How does a golf course make its money?

A golf course is a land business with a hospitality business attached. The fairways draw players, but much of the income is earned at the clubhouse, in the pro shop and at events. How these pieces fit together varies a great deal from one course to another, so a buyer needs to know which ones carry the course and which are extras.

Green fees and memberships

Green fees come from players who pay by the round. They follow the weather, the calendar and the course’s reputation. Memberships work differently. Members pay early or in instalments, which gives the course cash before the season begins, but they also expect a certain standard of play and access. Ask how many members the course has, and what each one is entitled to.

Carts, shop and lessons

Cart rentals add income to nearly every round, and some courses own the carts while others lease them. The pro shop sells equipment and clothing, and the pro may teach lessons or run clinics and junior programs. Check whether the pro is an employee or an independent operator, because that changes who actually receives the income.

Food, drink and events

A restaurant or snack bar, a bar, tournaments, weddings and corporate outings bring in income apart from the golf itself. They also add staff, inventory and rules about serving alcohol, which your lawyer can explain. Ask how much of the clubhouse business depends on golfers and how much comes from people who never touch a club.

Weather and season

A wet spring or a short summer affects every line at once. Ask the seller for several seasons of results, not just the best one, and for the reasons behind any big swings.

The guide to buying a golf course covers the full purchase, and what to check before buying a golf driving range is a useful comparison.