Golf for Argyll

The so-called ‘credit crunch’ is chewing at some of Scotland’s best known golf courses, including possibly Argyll’s ultra-exclusive Loch Lomond, recent host to the Barclays Scottish Open. It has recently lodged accounts showing that an annual loss of £19.2 million - an increase of 300%. The shareholders deficit is thought to be around £70 million and the club is reported to be in urgent talks with its bank, Halifax Bank of Scotland (HBOS). HBOS is itself known to be oin a degree of trouble.

The Glen Golf Club in North Berwick went for redundancies in June; Haddington Golf Club in East Lothian had to deny publicly that it was on the brink of bankruptcy; and business as well as personal problems are thought to have driven Castle Park’s owner to suicide last year.

What’s happening is that golf’s revenues are governed by disposable income - which is rapidly being cut back in today’s rising prices and falling financial markets.

The high end of the market is largely above the fray. The low-end pay-to-play courses, where they are well run - and many are, are likely to survive because they attract the younger players who prefer a less formal context than most traditional members’ club create.

The middle ground - the members’ clubs, most with an ageing membership - will feel the hurt most keenly. Their management standards are more varied that the top or bottom ends and their membership, with substantial annual fees to meet, will be the hardest hit by a sudden drop in disposable income. Mike Williamson, golf business consultant with MW Associates, based in Edinburgh, paints a picture of a 20% growth in supply over the 10-15 years - alongside much slower growth in golf tourism and in the numbers playing and taking up the sport. He sees around 20% of middle ground traditional members’ clubs facing potential financial problems. He sees possible solutions - hard for many to accept easily - as including amalgamation or sharing clubhouse management and/or greenkeeping operations - or shutting up shop.

Argyll has a fair number of characterful pay-to-play courses but some of its long establisjed members’ clubs may be in for hard times and tough decisions.