I Heard It Through The Orange Tree

Last week’s PGA Merchandise Show in Orlando was a major spectacle as usual.

After sifting through the hundreds of discussions that our Apparation team had at this year’s jam session, here are the 3 most significant takeaways.

#1 – Industry Equilibrium
I attended the annual State of the Industry presentation on Thursday.  While there were many detailed insights offered up by Jim Koppenhaver of Pellucid Corp. and Stuart Lindsey of Edgehill Consulting, here’s the one that hit home for me.

Koppenhaver suggested that the industry is moving slowly towards “equilibrium”, which he described as a level of US golf industry profitability that compares to the “glory days” in 2000.  From where we are now, we can get to equilibrium one of three ways:

1. Close another 1,000 golf courses
2. Generate another 30M-35M rounds per year at average rates
3. Some combination of 1 and 2

30M-35M rounds per year equates to about 1.5 additional rounds per golfer per year.  That’s right, if we could get Joe and Josie Golfer to play and pay for one more round of golf every 8 months, the industry would be in a good place financially.

I vote that we try for door number 2.  We’ve got record numbers of people entering their prime playing years during the next decade… let’s all do everything in our power to help them play more golf.

#2 Fresh Blood
Keith Kreft of Never-Search, one of Apparation’s colleagues in the IGDB Consortium, visits practically every booth in the major golf trade shows to promote his golf contact database services.  Keith shared the observation this year that there were just under 1,000 exhibitors at the show and that just under 30% of them were first time exhibitors.  According to Keith, he’s been tracking this for years and that the 30% figure is consistent from year to year.  There is no shortage of new ideas in the industry… we know that not all of them will succeed but our industry is blessed with a steady supply of passionate new entrepreneurs trying to make a difference.  If you haven’t been to the show for a few years, get down there in 2021 and check out the fresh blood.

#3 The Tee Sheet Wars Are Heating Up
Those who have been reading my posts for awhile know that I pay close attention to the highly competitive golf management software market… what I call the Tee Sheet Wars.  The headline event of 2019 was the acquisition by the largest public course vendor (GolfNow) of #2 EZLinks.  We’re picking up hints that the top story of 2020 might be the melding together of the public course and private club vendors.  For years, these have been relatively discrete markets… with relatively minimal overlap… but recent activity suggests that’s changing rapidly.

GolfNow announced a major push to sell services to private club operators, presumably leveraging the IBS software it acquired in the EZLinks deal.

Allegiant Airlines announced in its earnings call this week that they are in negotiations with a potential purchaser of its subsidiary Teesnap.  The most prevalent rumor is that the suitor is one of the large private club software providers.

Private club supplier ClubEssential recently bought muni course supplier Vermont Systems.

Private club supplier Northstar recently purchased Chelsea Systems.

Two large vendors told us at the PGA Show that they are focusing efforts on crossing the aisle.

And while the old guard are merging and re-inventing themselves, two new kids on the block occupied booths at the show this year… Club Caddie and TenFore Systems.

This market just gets more interesting every year… we’ll keep our ear to the ground for you.

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So that’s what the Apparation team took away from Orlando this year.

What did you learn?  If you want to share, post a comment below.