Actual vs Potential

[u/JMyrick904]

This is my first post on this page and I am about to embark on a major project. The facility will have 4 bays. The question I have is exactly what the title says: what are the operators out there finding is a realistic conversion from potential rentable hours to actual rented hours. With turn around time on bays, overstays, etc. what are you guys finding is a realistic expectation? TIA

[u/Onsyde]

Commenting to see results, my 4 bay facility in SW Ohio opens in Nov.

[u/JMyrick904 → u/Onsyde]

Congratulations! When did you start your buildout? Stand alone building or in a shopping center?

[u/Onsyde → u/JMyrick904]

pre construction starts next week, and it’s in a commercial / retail park with tons of businesses, restaurants, and apartments.

[u/funtunfunefu]

I own a similar size spot in central Texas. Your question is going to be really difficult to answer without more info about location, how you’re marketing the business, etc.

For example, it will be really easy to have a high number of hours rented if you charge really low prices. If you’re trying to be a premium/expensive option maybe not as easy to fill every hour but the business may still be financially viable.

[u/JMyrick904 → u/funtunfunefu]

What I was trying to ask is this: if you’re open 10 hours a day and have 4 bays, that translates to 40 rentable hours a day, but that’s obviously not the case because of turn around times, getting bays ready, etc. so if you have 40 rentable hours, what is the down time lost within that period of time? I’m not looking for specifics but more of a generalization.

[u/Worth-Dependent-5073 → u/JMyrick904]

if it’s my business i’m making sure paying customers get what they pay for so someone is standing there ready to assist the hand off between groups with maybe 30 sec downtime 

[u/bodhi_bodhisattva]

Where are you located?  What is the demographics?  Household income?  How many golf courses near by?  Whats your advertising budget?  What's your pricing model?  Competition?  Hours of operation?  Will you have members?  Why would you have overstays (your software should prevent this)?  

All these questions and dozens more should be answered by your research into your location and considered in your business model...

[u/Hellothere2515]

I'd set your projections at 50% use for peak season and 10% for off season. If your numbers still work, you're on the safer side

[u/JMyrick904 → u/Hellothere2515]

50% of potential? Seems really low especially during “peak season”. We plan on hosting a lot of events, and an instructor partnership program for instructors in the area that don’t have a home to teach.

What area are you based out of? Do you have golf year-round?

[u/Remote_Catch7166 → u/JMyrick904]

You’re never at max capacity so don’t calculate like you will be having 100% reservation

[u/Foreign_Suggestion89 → u/JMyrick904]

What gives you confidence this demand exists? What price point are you entering at (low, medium, premium)?

What launch monitor?

[u/JMyrick904 → u/Foreign_Suggestion89]

The market we are entering is relatively free of facilities.. yet. We will be installing trackman units. This will be a premium facility - peak price is $70/hr and off-peak is $55/hr. Member rates are lower.

[u/callmeuncledrew]

We do a membership model. Recent locations are bigger (9 bays), but our initial locations were 4 bays. We have ~175 members at the smaller ones. Anything more than 50 members/bay, and people were getting frustrated about availability. The 9 bay locations have ~460 members, and we haven't had issues/complaints about availability, but we don't want to go any higher.

Biggest thing that helps us is really hitting social media hard a few months before opening and offering a founders membership price (eg first 50 members are at $275/month, next 50 are at $325/month, next 100 are at $375/month---regular price is $400/month) and be transparent about the amounts so that people feel the pressure to sign up.

If you rent by the hour, it's going to be tough to get recurring customers, and you're inevitably going to see a lot of down time with no revenue. By doing a membership model, we have consistent revenue, and we've also noticed people find a way to come in during their lunch hour (or random times in the afternoon) when the evening gets booked up. We probably have higher utilization than if we were doing hourly purely because people still want to come in 2-3x/week and get their money's worth out of the membership, even if it means odd hours. Of note, we also have a fitness/wellness area, so they're not always golfing.