Economy Slows Sports Spending

Evidence of a decline in consumer spending can be seen on the fairways, the lakes and in the backwoods. Many people from country club managers to salesmen said fewer people are paying to play these days and it’s putting a bite on their business.

Jason McClung, general manager and club professional at The Creeks Golf Course in Cave Springs, said the public course has seen a 15 percent to 20 percent decline in the amount of rounds being played during the peak season of May, June and July.

“We had above average rainfall and that’s part of it,” he said. “But it’s also people having to drive to the golf course.

“When it takes $10 just to drive to the course and back, obviously that adds to the cost of a round of golf.”

In the past, McClung said people would play even on days when the weather was less than perfect.

“If it was a little bit rainy, they’d still come out and take the risk,” he said. “Now they’re waiting for the forecast so that they know it’s going to be a nice day. If you’re spending $45 for a round of golf on the weekend, you want to have an enjoyable day. You don’t want to play on a halfway decent day.”

McClung said The Creeks had to increase its fees per round by $5 on weekends and $3 on weekdays to cover the increased cost of fuel used in the mowers and golf carts.

The carts burn a half-gallon of gas per round, he said.

McClung said the course is also seeing fewer corporate events.

Companies don’t have the extra money to spend taking employees and clients out for nine to eighteen holes.

Companies that used to take a group of 20 employees or clients out to the course and spend $1,500 to $2,000, aren’t as willing to spend the money now.

“That’s probably where we’ve seen the biggest decline because that accounts for a lot of our rounds,” he said. “We were booking two or three of those a week, now it’s down to one a week.”

In an effort to attract golfers, the course is offering discounts at certain times to get them on the course.

Taylor Willet, general manager and golf professional at Stonebridge Meadows Golf Course in Fayetteville, said revenue is down about 11 percent from last year due to several factors.

“The price of oil and the housing market are not helping much of anything,” he said.

And then there was the rain.

Willett said the spring was one of the wettest on record for the area, which contributed to the season’s slow start.

“It’s hard to tell exactly what the cause is,” he said. “Golf is a funny business.”

In July, the course had to increase green fees for the first time since 2004. Fees went up $5 to $44 on weekdays and $54 on weekends.

Willett said the increased fees help cover the cost of fertilizers used on the course, which went up 20 percent this year due to fuel surcharges.

“We had to adjust our budget accordingly and the consumer has had to pick up those costs,” he said.

Stonebridge is also closely tied with housing market, relying on the sale of surrounding lots to cover a significant portion of its operating costs. The course is currently surrounded by over $2 million worth of empty lots.

“It would definitely help us if those were selling,” Willett said.

The news is not all bad — sales in the pro shop increased by 10 percent.

“It’s a culmination of several factors all coming down at once,” Willett said, “It’s getting more expensive to live and your discretionary income goes to the gas tank instead of the course.”

Private golf courses aren’t seeing the same effects, however.

Paul Eiserman, golf professional at Pinnacle Country Club in Rogers, said the club had a great year with a record increase in its junior program memberships. Eiserman attributes the increase to the club’s staff, service and programs. It also helped, he said, that the club hosted the 2008 P&G Beauty NWA LPGA Championship in July.

Slow Boat

The high cost of fuel has also kept many boaters off the water this season. Customers saw gas prices at Beaver Lake marinas climb close to $5 per gallon.

But gas prices aren’t the only thing keeping boaters docked. Bob Pope, owner of Hickory Creek Marina in Lowell, said a combination of bad weather, the slumping economy and high water have made for a slow season.

“The cold wet spring and the flood waters we’ve had here since February haven’t helped,” he said.

The marina saw a 40 to 50 percent drop in activity in May and June and a 30 percent drop in July.

The high gas prices have mostly affected the fishermen, Pope said. The fishermen are closely tied to the housing industry, he said, they work as plumbers, painters and electricians.

“With the absolute collapse of the housing industry, those guys really had to tighten their belts,” he said.

Scooter Sales

In another industry, the high price of gasoline has had a positive effect on at least one segment of business.

The sale of street motorcycles and scooters at Heartland Honda has tripled this year, according to General Manager Greg Donahoe.

Scooters get about 100 miles per gallon of gasoline, while bikes get from 40 to 80 miles per gallon, he said.

For that reason, the popularity of scooters has expanded beyond the demographic of college students and gone more mainstream.

That helps to cover the hit taken by dirt bikes, watercrafts and all terrain vehicles.

Dirt bikes have taken the biggest hit, Donahoe said. Because of where the trails are located, dirt bikers have to travel 30 to 40 miles outside of the city limits to ride, which typically means pulling a bike with a truck that gets 12 to 15 miles per gallon.

The sales team at Heartland Honda is trying to minimize the impact with promotions.

“We’re aggressively promoting the deals we have to try to counter punch the negative impact of high gas prices,” Donahoe said. “We’re willing to live with lower margins to keep the product moving.”

One product that’s not seeing much movement at all is the watercraft segment.

Watercraft sales have a taken big hit because of a combination of bad weather and a slow economy, Donahoe said.

“We’re still carrying a lot of inventory there,” he said.

On the other side, the dealership’s service department has seen an increase in revenue as customers are trying to maintain what they have.

“People aren’t upgrading as much as they did in the past,” Donahoe said. “They’re holding on to what they have and trying to make it last longer.

“We’re fortunate that the service business is up so that the net effect is a positive one.”

Generator sales have stayed constant, Donahoe said, which is one positive effect of the many storms that have swept through Northwest Arkansas recently.

Donahoe said he’s hoping to see a revival in ATV and utility vehicle sales, particularly with the release of Honda’s latest toy, a UV called Big Red.

Big Red, which starts at about $11,400, arrived at Heartland Honda in August.

“The timing couldn’t be better,” Donahoe said.

For now, the UV is attracting the attention of hunters, ranchers and boat dock owners. As soon as the dealership can get more of them — it only has two in stock — Donahoe hopes to market them to the University of Arkansas and area municipalities.