Private clubs saw 34.6% drop in non-dues revenue in March

Club Benchmarking's recent survey shows impact of COVID-19
  • Ray Cronin, Founder of Club Benchmarking

Private clubs in North America took a financial hit in late March, with non-dues revenue dropping from $96.5 Million to $62.6 Million, according to a report by Club Benchmarking, which was the first view of the impact of COVID-19 on the private club industry. That translated to $249,586 for the average club, down from to $384,463 in March 2019 or a 34.6% drop. That represented the greatest financial impact on clubs in March. Dues Revenue, which is the primary source of funds, increased 3.7% at the median year over year for clubs with golf and 3.6% for clubs without golf.

Like many other businesses, private clubs began shutting down around March 15, meaning activity for at least half of the month of March was relatively normal. Many clubs pivoted quickly to engage members with take-out dining which appears to have muted the decline in non-dues revenue. For clubs without golf, like yacht clubs and city clubs, non-dues revenue declined more severely than it did for clubs with golf — 39.2% versus 33.2%.

Club Benchmarking provides a Strategic Monthly Dashboard,  a business intelligence service for the private club industry that makes it possible to systematically measure monthly trends in Membership, Cost of Belonging, Initiation Fee and Joining, and Finances. More than 250 clubs in 38 states and four Canadian provinces use the service, and more than 300 provided date for the most recent analysis. 

“Our Strategic Monthly Dashboard addresses the industry's need for accurate market trend data that allows clubs to navigate both up and down market cycles with clarity,” said Club Benchmarking Founder Ray Cronin. 

Year-over-year membership counts held steady across the industry, up marginally at .3% in March 2020. The median club without golf reported a total member count of 808 at the end of March 2020, while the median club with golf tallied 667 members.

In March 2020, the median initiation fee was $35,500 to join a club with golf and $10,000 in clubs without golf. Tracking year-over-year changes in initiation fees for March, 69% of clubs had no change, 5% decreased their initiation fee and 26% increased the initiation fee.

March reporting also showed that 24% of clubs had a wait list and 24% had a sell list meaning there are members waiting to receive equity back from the club after leaving. Of the clubs with a wait list, the median number of prospective members on the list was 16. The median number of members on the sell list was 18.

In clubs with golf reporting March 2020 data, the total cost of belonging was $11,793 at the median, up 3.7% year over year. In clubs without golf, the median was $4,652 which is an increase of 2.9% year over year.

Among all clubs, debt decreased 5.3% at the median year over year, while capital investment declined 14.6% in March 2020 from the prior year.

Club Benchmarking plans to continue to monitor and report on how the COVID-19 crisis is affecting private clubs, with revenue expected to be lower for April and rebounding in May. 


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