Archive for May, 2014

7 Steps to Improved Club Retail Operations

Monday, May 26th, 2014

Many club retail operations are managed by golf or tennis professionals who may have an incentive opportunity based upon gross sales and cost of goods sold.  While such incentives may only be part of the professional’s overall income, there are some things that can easily be done to improve the financial performance of the operation.

1.   Use an Annual Buying Plan – What and how much inventory you buy each year should be carefully planned.  Your plan should be in writing and be revisited at the end of the year to see how well you did in buying and selling various categories of merchandise.  Revisiting you plan at year’s end will help you improve next year’s buy.  Good buying decisions are the most important thing you can do to be a successful retailer.

2.   Benchmark your Operation – Retail operations must be benchmarked in detail to learn as much as possible about what sells and doesn’t sell.  The more you know about your customer’s buying habits, the better your future buys can be to serve your market.  It’s also important to analyze the results of buying and markdown decisions.  What and how much you mark down represent your buying mistakes.  You should always learn from your mistakes to avoid repeating them.

3.   Use a Merchandiser’s Book – Proper management of retail inventories and good business practice require that retail managers maintain close scrutiny of their buying decision, retail benchmarks, inventory purchase orders, and a log of their major merchandising decisions such as markdowns, sales, inventory discrepancies, write-offs, and any member feedback about the retail operation.  By maintaining this information in one location, retail managers have a convenient method of continually analyzing their buying and merchandising decisions with an eye toward continual improvement.

4.   Know your Customers by using a Membership Retail Book – Each retail interaction with a member buying merchandise reveals something about his or her buying habits and preferences.  A Membership Retail Book is simply a place to organize and record the information learned about each member.  It is as simple as recording member information in an alphabetized ledger book under each member’s name or utilizing the member preference feature of your retail software.  Once information has been entered for a particular member, it is easy to add more information each time that member shops.  In time the Membership Retail Book will accumulate a wealth of information about members buying habits and preferences.  This information can be used to better serve members and increase retail sales.

5.   Have an Established Discount Policy – Inevitably some merchandise will not move quickly and will sit on shelves or racks for some time.  Such slow-moving merchandise should be made more attractive to members by reducing the price through a series of pre-defined discounts.  Tracking such discounts in the Merchandiser’s Book may help the retailer understand what didn’t sell at full price and this understanding will help improve future buying decisions.

6.   Use a Sales and Promotion Calendar – An annual sales and promotion calendar should be developed to help the retailer market promotional and discounted sales.  The more members that know in advance about promotions and sales, the more foot traffic you’ll have in your shop.  It can also be used as an opportunity to learn more about your member’s buying habits.

7.   Rotate Stock and Change Displays – Move merchandise around daily or frequently to keep the shop interesting and fresh.  Use props and displays to showcase merchandise.  Seasonal decorations offer many opportunities to make the shop attractive and inviting.  Ensure shop clerks are familiar with all products in the shop.  Staff must be familiar with their inventories and knowledgeable about products carried in inventory.

None of the above steps are rocket science.  More than anything they are the organizational habits of a professional retailer.  Implement any or all of these practices and watch your business and annual incentives grow.

Thanks and have a great day!

Ed Rehkopf

This weekly blog comments on and discusses the club industry and its challenges. From time to time, we will feature guest bloggers – those managers and industry experts who have something of interest to say to all of us. We also welcome feedback and comment upon the blog, hoping that it will become a useful sounding board for what’s on the minds of hardworking club managers throughout the country and around the world.

Club Resources International – Management Resources for Clubs!

Onboarding Managers – An Often Overlooked Best Practice

Monday, May 19th, 2014

A long-recognized best practice is to develop an onboarding plan for your operation’s new hires.  The purpose of such a plan is to ensure that new employees are welcomed to the enterprise, receive the appropriate orientation and introductions, and are indoctrinated into the organizational culture, as well as receiving a basic review of enterprise information, employee benefits, operating policies, and work rules.  When the onboarding process is formalized and consistent, all employees have an appreciation for the story of the organization, an awareness of their job requirements, and a common understanding of expectations for their conduct and performance.

While there is no denying the benefits of a thorough onboarding process for line employees, it is even more critical that the enterprise put a similar effort into onboarding newly-hired managers and supervisors.  Regardless of education, work history, and experience, these individuals act as agents of the enterprise and set the standard for everything their employees do.  With so much riding on their leadership and example, ensuring they convey consistent direction and standards to their employees cannot be left to chance.

My optimum onboarding process for managers and supervisors includes the following:

  • The same onboarding process as line employees receive so that they hear and understand what line employees are told.
  • A copy of the Employee Handbook provided for the same reason.
  • A thorough indoctrination in organizational values, presented by the General Manager for maximum impact and effect.
  • Leadership guidance from the General Manager to ensure that all managers have a common understanding of service-based leadership and their critical role in communicating with and motivating employees.
  • A copy of a Managers Handbook, written specifically to spell out expectations for those who direct the line employees with emphasis on employment law, legal and liability issues, work rules, fiscal responsibilities, safety and security, as well as an in-depth discussion of counseling, conduct, discipline, and performance requirements.
  • A detailed review of job description and performance expectations by immediate supervisor
  • A copy of the operation’s Strategic and Annual Plans so they understand its direction and trajectory.
  • In concert with immediate supervisor, the development of an individual work plan with first year reviews at 30, 90, and 180-days.  Early engagement, counseling, and intervention as necessary are critical to the long-term performance and success of any newly hired manager.
  • Introduction to and review of personnel and accounting standards, policies, and procedures by Human Resources Manager and Controller, respectively.
  • Introductions to key management staff.
  • For managers of private club, presentation to board and key committee members.
  • A first-year reading list of management and leadership books to include Jim Collins’ Good to Great: Why Some Companies Make the Leap . . . and Others Don’t, John Maxwell’s Developing the Leader Within You, and Stephen Covey’s The 7 Habits of Highly Effective People.  To be most effective, these books and other periodically assigned reading material should be discussed on an ongoing basis at weekly staff meetings.
  • Office or work space set up, fully prepared, and waiting for the new hire.  Minimum support requirements include a personal computer or laptop, cell phone or PDA, a list of key phone numbers, a listing of department heads and managers with land line and cell numbers, security codes for work areas, and a set of keys for all necessary spaces.
  • After several weeks the General Manager will set up a one-on-one meeting with the new hire to see how he or she is settling in, to answer any questions, and to once again reinforce basic leadership concerns, organizational values, and enterprise goals.

While this level of effort to onboard management staff seems like a lot of work for something that may only happen a couple of times a year with normal turnover, the potential repercussions of not providing consistent information and expectations to new managers and supervisors and continuing to reinforce it on a regular basis can have a significant and long-term impact on the quality of the operation.

While there are many important and valuable HR best practices, I don’t believe there is any as important as establishing the basis for how your organization runs with those who must lead employees.  The time and effort put into individually developing your management staff and forging them into a team with a common understanding of purpose and means is the single most critical driver of an enterprise’s success, yet how often is it overlooked in the ongoing press of daily operations?

Thanks and have a great day!

Ed Rehkopf

This weekly blog comments on and discusses the club industry and its challenges. From time to time, we will feature guest bloggers – those managers and industry experts who have something of interest to say to all of us. We also welcome feedback and comment upon the blog, hoping that it will become a useful sounding board for what’s on the minds of hardworking club managers throughout the country and around the world.

Club Resources International – Management Resources for Clubs!

Utility Benchmarking: The First Step in Energy Conservation

Monday, May 12th, 2014

Almost daily we hear more disturbing news about environmental degradation and the impact on our planet of our ever-increasing levels of fossil fuel consumption.  Just a few years ago there was a significant debate on whether the current period of global warming was man-made or if it was just part of the natural cycle of the planet.  While some scientist continue to question the exact causes of warming oceans, melting icecaps, degradation of the ozone, and other symptoms of our impact on Mother Earth, the consensus today seems to be we are facing a looming crisis and that much needs to be done to decrease our carbon footprint in all areas of our lives.

While most of us wait for some stroke of technology or government intervention to lead us out of the crisis, there are currently and soon-to-be other significant reasons for the business sector to address the problem within the scope of their operations – that of cost.  While government regulation of utility prices has kept the upward climb of utility costs manageable, we cannot always expect this to be so as the cost of extracting oil or converting to new greener technologies is expected to rise dramatically in coming years.

Environmentalists have long pointed out that the cheapest alternative to ever rising energy costs is that of avoidance – of conserving energy by the end user.  This applies to our homes, but increasingly is being looked at by businesses as a way of reducing or stabilizing these costs.  It seems at every turn we are being encouraged to change our light bulbs, better insulate, shift demand to non-peak hours, purchase more energy efficient machines, or just turn off unneeded lights and equipment.

Whether you are currently considering new investment in energy-saving technologies or will wait until it becomes a financial imperative for your operation, you will not be able to adequately determine the cost/benefit of any initiative without an understanding of the energy use at your facility.  Without this understanding any decision you make will be based upon wishful thinking or the promises of vendors.

So now is the time to start benchmarking your utilities which is easily enough done by tracking your consumption and cost for electricity, gas, and water.  For each one of these commodities you receive a monthly bill from your utility companies that provides all the pertinent information.  It’s a simple matter of extracting this data from the invoice and putting them in Excel spreadsheets month-by-month and year-by-year for each area of your operation for which you receive a bill.

Whether you plan to act soon to control energy costs or wait to some future time, these utility benchmarks will serve you well as you determine options and costs.  Someone once said that, “You can’t manage what you can’t measure.”  I would say that it’s also true that, “You can’t improve what you can’t measure.”  Start measuring your energy use patterns and costs now so that you can make those improvements when it becomes necessary.

Check out the utility benchmarking instructions and spreadsheets on the Hospitality Resources International website.

Thanks and have a great day!

Ed Rehkopf

This weekly blog comments on and discusses the club industry and its challenges. From time to time, we will feature guest bloggers – those managers and industry experts who have something of interest to say to all of us. We also welcome feedback and comment upon the blog, hoping that it will become a useful sounding board for what’s on the minds of hardworking club managers throughout the country and around the world.

Club Resources International – Management Resources for Clubs!

Monthly Review of Financial Statements

Monday, May 5th, 2014

General Managers should conduct monthly reviews of Operating Statements with department heads.

In order to ensure that the operation meets the financial objectives of its annual operating budget, it is imperative that all department heads monitor their monthly performance closely and be prepared to answer questions about their department’s performance and give reasons for any significant variance from budgeted amounts.

On a monthly basis after the final statement is prepared and distributed, the Controller will set up a schedule of meetings for department heads to meet with the General Manager and Controller to review their department’s performance.

  • Department heads will bring their individual copies of the Tools to Beat Budget binder to the meetings, as well as their departmental benchmarks.
  • Department heads must also be prepared to present plans to remedy significant or ongoing shortfalls in revenue or overages in expense categories.
  • Managers can best prepare for their monthly meeting by ensuring that their Tools to Beat Budget binder is accurate and up-to-date.
  • They must also review their financial statements in detail, noting any under budget revenue and over budget expense categories.  Items with significant deviations from budget must be investigated so that these anomalies can be explained to the General Manager.

Significant shortfalls in revenue should be analyzed and a plan drawn up to address the shortages.  Such a plan would normally include marketing efforts to increase customer traffic, special events or sales to increase revenues, or price increases to generate more revenue from the same volume of business (though managers must always keep in mind that volume may decrease with any price increase).

Often a particular expense category will be over budget due to timing issues – this happens when a budgeted expense is incurred earlier in the fiscal year than originally anticipated.  Such an “over budget” occurrence will come back in line with budget in future months at the time when the expenditure was actually planned.  Sometimes, the increased expenses may be the result of an unanticipated event, such as equipment breakdown and repair or an arising opportunity necessitating the purchase of new equipment or materials.

In any case the department head must be prepared to explain discrepancies and answer the General Manager’s questions about budget variances and what actions will be taken to remedy the situation.

Ed Rehkopf, Excerpted from Basic Accounting and Financial Management for Managers, Hospitality Resources International

Thanks and have a great day!

Ed Rehkopf

This weekly blog comments on and discusses the club industry and its challenges. From time to time, we will feature guest bloggers – those managers and industry experts who have something of interest to say to all of us. We also welcome feedback and comment upon the blog, hoping that it will become a useful sounding board for what’s on the minds of hardworking club managers throughout the country and around the world.

Club Resources International – Management Resources for Clubs!