The Pellucid Perspective - February 2023 - 6

LOCAL MARKET
ANALYSIS
Why Does Market Analysis Matter?
Let Me Count the Ways...
By Jim Koppenhaver
A
t this year's (well-attended and well-executed) Golf Business
Conference (GBC) in Orlando, Stuart and I had
the honor of speaking on the '22 State of the Industry as
a preview to our 20th annual full Monty presentation, for the
20th consecutive year, on Thursday in Orlando. We also took
advantage of the opportunity to sit in on several of the other
GBC educational sessions and one that I've perennially watched
with interest was on the fundamentals of buying or selling a golf
course. While the market has changed considerably over the
past 3 years, the general approach by service providers and accepted
by buyers and sellers is still deeply rooted in " we think,
we feel, we believe " based on faith that the historical experience
of the broker is the Rosetta Stone in understanding the market
conditions (and that would be across all 210 Designated Marketing
Areas or DMAs across the US or, heaven forbid, we want to
understand the actual, immediate draw area around the subject
facility which now expands to tens of thousands of " markets " ).
After seeing the Top 10 list of " must-haves " for buying/selling
a golf course and the absence of market analysis (maybe it
was #11...), I asked the presenters how they account for market
factors. The clever redirect from one of them was " We ask you "
(which I chose not to call out in public that they, in fact, don't
use any of our services) and the follow-up answer was that the
facts collected from the course, informal solicitation of competitors
and the experience of the broker obviated the need for market
analysis for all but the most complex situations. Before I
quantitatively and briefly disprove that notion, hopefully all of
6 The Pellucid PersPecTive
our readers know that Stuart and I have been wrestling with,
compiling and refining our approach to market analysis for any
US geography using technology (instead of experience/boots on
the ground) for a combined 4 decades now so we're not impartial
or unbiased on this topic. True to our mutual nature, part
of what keeps us going is the industry veterans' insistence over
the years that it can't be done. If you ask my mom the surest
way to get me to do something she'll tell you, " Tell him that he
can't do it " . That all started way back in '02 when I connected
with Ray Munoz, then the head of Textron Financial's lending
unit who looked at my PowerPoint blueprint of the Golf Local
Market Analyzer and said, " Jim, I've been trying to do that for
5 years here and not succeeded; if I couldn't do it with the vast
resources at my disposal and my significantly more golf industry
experience, then your odds of pulling that off are slim. " Ray is
now gone, Textron is now gone and...Jim and Pellucid are still
here, we've built GLMA 3.0 and it's getting better annually. But
I digress.
Let's start with the core elements of market analysis that can't
be found in scouring the financials of any particular facility:
1. What is the size of the draw area population base
(what is the draw area for the course, your standard
demographic choices are Counties or ZIP Codes,
neither particularly granular), is it growing or shrinking;
are the demographics (Income, Age, Ethnicity etc.)
favorable or unfavorable for golf?
February 2023
PHOTO BY CARLOS MUZA ON UNSPLASH
The Pellucid Perspective - February 2023

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