Golf In The Family (Business)

Will Golf Make It In 2009?

Charlie follows the golf industry stocks such as Golfsmith, Callaway Golf and Fortune Brands (Acushnet). He does this for his own amusement since he doesn't own stock – he left that up to me. Even he's surprised at how far in value the stocks of golf companies have dropped this year.

As we watch the saga of the Big 3 Auto makers unfold and read the pros and cons of bankruptcy I wonder how an international industry such as automobiles or golf can survive if a critical number of consumers stop buying? What is that critical number? Is it regional, national or international?

The golf courses around here are offering terrific deals to play. You can practically play for free sometimes. Any nice day in November is potentially incremental business for a golf course so giving you a deal is good for both.

It's not that way with golf equipment. There is only so much room for deals and giving away the product is really not an option. Unlike golf courses the retailers are beholden to the equipment manufacturers who have to deal with multiple sales channels mostly competing with each other for the same piece of pie. Price wars have driven many a small retailer out of business and it's not clear what the major equipment companies want to happen.

Some years ago I read an article about the future demise of major league baseball. The writer believed that baseball would fade into the sunset as fewer people played the game and eventually watched the game because of the myriad of problems MLB owners and the players' union caused.

That may not be the case but who knows? Maybe baseball will be just something in history books 50 years from now or only played by tiny sects of fans like cricket in India. Somehow, the Chicago teams make it possible for people of most incomes to see some of the games some of the time. As long as there are fans the game should last, even if fewer of these fans ever play.

I doubt that's the case with golf. Is the club industry intertwined with the game itself that one can't survive without the other? If the going gets tough will golfers forego new clubs to play more golf? For how long?

Season Comes to a Close at Klees

The 2008 golf season is winding down in a swirl of exceptional fall color and financial gloom. The cacophony of the elections is barely matched by the buzz about the Dow Jones decline and what that might mean in the year ahead.

As Klees Golf Shop prepares to close for three weeks I find myself in the usual state of panic this time of year. How will we pay the bills? Will the holiday sales be any good? Can we keep inventory at a minimum and still have what people want right now?

Necessity is the mother of invention and inventiveness is crucial to survival. Charlie's grandmother sold baseball gear, magazines and radios during the depression. Charlie's dad juggled inventory, convincing customers that what was on the shelves was what they wanted. We have eBay and the cyberspace of customers, many of whom can still buy cheaper in America.

Klees Golf Shop produced and mailed catalogs in the 1930s to attract customers from outside the area. Charlie introduced newspaper and Yellow Pages advertising in the 1970s and maintained a schedule of print promotions that reached the whole Southside region.

Getting golfers to our website is a bigger challenge because cyberspace is so vast and so impersonal. Mastering the complexities of web design, e-tail shopping and search engine optimization in my home office is like mastering mechanical physics with a text book in my garage. What I know is not enough and it's time to be inventive.

No Olympics for Golf (or Chicago)

The tour players are now taking drug tests and some of them are taking a drug test before every event. I was reading about how difficult that is for some of the players to take a drug test two or even three days in one week, especially at the end of the season. I don't doubt that drug testing is probably required in every professional sport, but it has the effect of demeaning both the players and the fans.

Drug testing is closely tied with the Olympics, which is where the PGA wants to see golf in 2016. The pervasive use of drug tests at the Olympics is only exceeded by the pervasive corruption within the International Olympic Committee, possibly the most hypocritical group of people outside the U.N.

Our home town, Chicago, wants to host the summer Olympics in 2016, despite the massive budget problems plaguing the city. It amazes me that either the PGA or Mayor Daley would spend an hour or a dime on seeking out that event.

The Olympics used to be about amateur athletics, international sportsmanship and some Greek ideal from 200 BC. Well, to quote Bob Verdi, “[That's] all Bolshoi. Their [Olympic Committee] finish line is the bottom line.” Once the athletes turned pro (which is what you call someone who gets paid to play, even if it's through the back door by way of endorsements) the Olympics lost their mission.

Why would you want to watch professional golfers play a match at the Summer Olympics when you can watch them play every weekend on The Golf Channel? Will college players make an Olympic match any different or better?

How will an Olympic venue open up the game internationally given that the major barriers to the game involve money? That is certainly the case with the countries in Africa, Central and South America.

The Chinese government sees golf as a capitalist, bourgeois sport that uses up resources and the Russian government is similar. Is that likely to change if golf becomes an Olympic Sport?

No, what will change is that the players will be subject to the same brutal drug testing, questioning and soap opera antics that all the Olympic athletes face. Who needs it.

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