In most clubs the high season is heading into its final days and managers already have their eyes on next year. This quarter is the time to plan the coming financial year.

One of the main tasks right now is preparing the budget. It is the quantitative guide to our activity, so it is essential to take the time needed to build it coherently and to find the balance between revenue and expenses, because each depends on the other.

Focusing on the sales budget, its importance is such that it will determine the revenue the club will receive and, from there, how it will be distributed (expense forecast).

To prepare it we need to be clear about a few premises:

First, we will consider qualitative aspects such as the stage the club is at and its overall business objective: launch, consolidation, price optimisation or crisis, among others. We said earlier that the sales budget will determine the club’s revenue, but it is also true that the business strategy will give us the guidelines on what the sales target should be, and that is what we will have to reflect in the budget.

We will also take into account the state of the market, whether it is favourable or not.

On another note, our budget must be ambitious and honest: we cannot fall into the temptation of drawing up a very optimistic but hardly achievable budget, because we would be fooling ourselves (with the operational and financial consequences a high revenue forecast can bring), nor one so unambitious that we beat it effortlessly and boast about our sales successes, because the cost or investment lines could equally have been affected by a poor revenue estimate.

Once all this is clear, we will define our budget in numbers. To do so it helps to know:

• Closing figures from previous years: they will show us how sales have evolved and help us estimate how much we can grow. It is also important to know whether any exceptional circumstance affected occupancy (an event in the area, prolonged rain, maintenance closures, etc.), since that data would be distorted.
• Position compared with the previous year: analysing whether we are ahead of or behind the same point last year for the following year, and how that period closed (the difference between these two indicators is the pick-up), will help us predict the closing figure.
• Situations we expect to have a direct influence on occupancy, positive or negative. Here we distinguish:
  • In the destination: a sporting or professional event, or the opening (or closure) of a hotel with a flow of players, for example.
  • Internal: special operations, events, campaigns, maintenance closures or the opening or closure of the accommodation (in the case of resorts).
• Segment: if we run a mixed club, with members and visitors, ideally we should separate these two families, which are very different in nature. Within visitors, distinguish the different groups: direct customers, tour operators, hotels, clubs without a course, etc. This classification will depend on the types of customer the club has and the relevance of each one.

It should not be an overly complex classification, but it should be broad enough to let us analyse whether we are hitting the target in each of the families.

This data will be very important because, although the ultimate goal is to have reached the revenue level we set out to achieve, the breakdown will tell us how we are doing in each segment.

For example, we may be hitting budget every month but systematically detect a close above target in tour operation and below target in direct sales. In that case, perhaps we should review our direct rates, the positioning of the website, etc. If we manage to correct it, we can add even more.

• Define both revenue and the number of rounds: this second indicator will serve other areas such as the shop or the restaurant to set their own forecasts. At points of sale, player traffic is decisive and they often build their budget from an average ticket multiplied by the number of players. The revenue – number of tee times combination will depend on the type of club and its business strategy (volume or exclusivity).

Throughout the year, segmentation and control tools will help us detect possible deviations. These may be due to changed market conditions, to actions not working as we had planned, or simply to a mistake when drawing up the budget. A revision (upwards or downwards) will help everyone work on real numbers. This update of the budget is what we call the forecast.

The forecast allows us to work on more realistic foundations that make it possible to manage resources well and avoid financial problems if we revise downwards.

In short, the budget will be the guide for both revenue and expenses during the financial year and must be articulated coherently so that we understand how the different types of customer evolve across the different seasons.

If you need help preparing the sales budget and the action plan for 2025, at RGS we will be delighted to work with you.

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