It’s the Members Experience That Counts

Host couple toasting drinks with guest at party

Private clubs are currently doing a much better job of running their money and understanding the key metrics in their business model. Principles like we’re in the “dues business” and recognition that food and beverage is an amenity, not a profit center, have club leaders thinking the right way. Clubs have also improved their focus on generating funds for annual capital repairs and replacements, adding fees to assure there is money to address these needs even when operations and initiation fees aren’t generating enough resources. Having once thought of the budget for repairs and replacement as an optional item, club leaders now clearly understand these are pressing issues. Left unattended, deferred maintenance results in unsatisfactory conditions or large catch-up assessments in the future. 

A lot of this is the basic “blocking and tackling” that is standard in many industries but has been unevenly applied in the disjointed club world. There is no doubt it is making our industry stronger. Now, some in the industry have been suggesting that it is possible, even preferable, for a not-for-profit club to generate reserves in excess of annual capital needs and then plow that back into aspirational projects. While this may be possible, it is only preferable if the product is where it needs to be today. Having seen some of these plans suggesting that the club is going to wait 5 to 7 years to build the pool or golf performance center it needed yesterday to be relevant is cause for concern. Saving your way to prosperity has rarely proven to be an effective business plan.

The first rule in attracting new members, which every club needs every year to replace normal attrition, and in many cases, to grow back to levels they last saw prior to the Great Recession, is to have something great to offer. Said another way, it’s the Member Experience that drives club success, not the balance sheet. Having a reserve plan is great, but if that plan is structured so that it’s years until your club can provide the experiences members want and need now, you need another approach. 

Prospective members join a club because it has the amenities, programs and services they believe will provide them a better, more enjoyable life. While getting your financial house in order is fundamental, it is important to remember this, finance shouldn’t drive your strategy; a solid financial outcome is the result of an effective strategy.

 

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About Frank Vain

President

Mr. Vain provides consulting and planning services to private clubs throughout North America and Asia. Through use of specialized services including membership surveys, strategic planning, operational analysis and facility long range planning, Frank assists clubs in developing individualized strategies for their unique situations.

Mr. Vain joined McMahon Group in 1988 and has more than forty years of experience in the management and development of hospitality properties including private clubs, athletic clubs, resorts and restaurants. Frank is a Past President of The Country Club of St. Albans, an 800-member, 36-hole country club located in Missouri and he is the former owner of Concord Sports Club, a 1,700-member family athletic club in St. Louis. Frank was elected to the Board of the National Club Association in 2011 and served as Chairman in 2018-19.

Mr. Vain is a native of Philadelphia and a graduate of Franklin & Marshall College, Lancaster, Pennsylvania. He is a featured speaker at the annual Club Managers Association of America World Conference, National Club Association National and Regional Conferences, Major Golf Associations and at regional chapter meetings of club managers and leaders.

He has written numerous articles that have been published in Club ManagementClub Director andBoardRoom magazines. Frank was named the Gary Player Club Educator of the Year for 2012 and 2015 by BoardRoom magazine. He is the co-author of McMahon’s Club Trends®, a recognized industry benchmark on the trends and issues affecting private clubs.

More articles by Frank Vain
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