Living the GreatLIFE
By: Jim Dunlap
April 16th, 2015
To view the full C&RB article by Jim Dunlap, click here.
A new model that combines golf and fitness memberships at extremely affordable rates is proving to be an especially attractive mix of recreational offers.
Golf, and more recently fitness, are continually championed by country clubs as key components of a great life. So it makes sense that clubs flying the banner of GreatLife Golf & Fitness would be a hit. And when the two amenities are paired for one very affordable price, with no initiation fee, the surprising thing is that the business model hasn’t been tried before—at least to the magnitude that GreatLife CEO Rick Farrant and his team have achieved in such a short period of time.
The Kansas-based GreatLife parent company was essentially dabbling in golf as the owner of three modest 18-hole golf courses in 2000, at the very apex of the last major wave of U.S. golf course development. Shortly thereafter, course owners began to feel the pinch of increased competition from newer and more elaborately amenitized properties.
In 2003, Farrant and his partners acquired their first fitness center, and began thinking that if bought, marketed and priced right, the package deal of golf and fitness could be a perfect way to attract cost-conscious families and individuals to both activities. Today, GreatLife’s corporate entity operates 25 locations, after recently taking the first giant step toward franchising its concept by teaming with Sioux Falls, S.D., entrepreneur Tom Walsh and his partner, Mike Malaska, to form GreatLife Malaska Golf & Fitness. That entity now owns five courses and eight fitness centers in the Sioux Falls region, with over 11,000 members and “affiliate” relationships with another 15 golf courses, where GreatLife members can play for as little as $10.
Farrant and Walsh are now shopping their franchising concept to owners and operators in other parts of the country, utilizing the proven track record of the GreatLife business model, along with the franchising expertise that Walsh developed in developing a portfolio of Burger King locations.
In some cases, GreatLife purchases golf clubs that have an existing fitness facility and improves upon both; in other cases, if a nearby off-site fitness center is available for purchase or lease, GreatLife will incorporate use of that facility into a membership.
In every case, GreatLife buys smart, acquiring courses or fitness centers that are either in bankruptcy or have become available at below-market prices. And whether it’s the golf or the fitness operation that’s struggling (or both), GreatLife has discovered that offering what is essentially a two-for-the-price-of-one proposition creates a much more attractive picture.
By any standard, the price for using GreatLife facilities is reasonable. Individual golf/fitness memberships are available for as little as $30 per month ($40 for a family) at the most affordable locations, Farrant says, with the company’s most expensive location charging a monthly fee of $450. There is no initiation fee, and members pay only a cart fee if they use one when they show up, no matter how often they play.
“People ask us all the time what the catch is,” Farrant says. “The only catch, if you want to call it that, is that the monthly membership fee is pro-rated for an annual year, so people don’t just join for the busy golf months and then drop out.”
Both Farrant and Walsh are committed to utilizing the GreatLife model to promote not only healthy and wholesome family activities, but participation in golf. Both the GreatLife and the GreatLife Malaska courses offer free, or extremely low-cost, golf clinics for families, adults or juniors. With time typically cited as the biggest obstacle to playing more golf—or playing at all—GreatLife members can stop in any time and play only a few holes without feeling obligated to “get their money’s worth” by having to make it through nine holes or a full 18, as they are pre-paid for the year.
The company has the track record to back up its faith in the golf-fitness combination. Farrant points out that “six to eight” of the company’s current locations were either closed or in bankruptcy proceedings when GreatLife acquired them; all are open today. On the fitness side, Farrant said that a YWCA fitness center in the Topeka, Kan., area was losing $15,000 a month when GreatLife brought it into the fold. It now operates in the black—and as Farrant notes, that means it can continue its support of other community programs.
As for Walsh and the GreatLife Malaska entity, since aligning with GreatLife the three courses that Walsh’s group owned or managed in 2014 have registered first-year increases of better than 46 percent in rounds, over 28 percent in revenue, and over 24 percent in food-and-beverage sales.
Holding Their Interest
Including golf in the package also helps to lower the traditionally high attrition rate at many fitness centers, the GreatLife executives contend. “The fitness center turnover or attrition rate nationally is around 40 percent a year,” Farrant says, “so you end up having to turn your membership over every year and a half or so. But if you have golf too, people are less likely to give up their memberships.”
Beyond their success to date, Farrant and Walsh hope to spread the GreatLife gospel to other parts of the country through their franchise program. In addition to the growing appeal of the GreatLife brand and helpful operations and marketing advice from the parent company, the nearly unbroken record of GreatLife success may carry the day to help prospective course buyers secure needed loans.
“Nine times out of 10, it comes down to financing when someone is trying to buy a course,” Farrant says. “One of the big things we bring to the franchise situation is our track record. If a buyer can show his lender what he plans to do, and how he plans to do it, and can then show what we’ve done, there’s a lot better chance that he’ll get the financing he needs.”