The Pellucid Perspective - November 2020 - 15

average ratio of just under 2K local resident golfers per EHE, a
level 33% higher than the national average.
The supply mix vs. the national distribution across Pellucid's five access/value/usage segments shows a marked bias to
the Private segment vs. the national distribution (43% of holes,
149 index). The split between Private/Public is 43%/57% which
tilts to Private vs. the national average of 28%/72%. The balance
between Value-added golf supply (Private & Public Premium)
vs. Value golf (Public Value, Price and Learning & Practice) is
60%/40% skewing markedly to Value-added golf vs. the national
average of 47%/53% (driven by the Private, not Pub-Premium,
component). Remember also that we establish the Premium/
Value/Price segments by individual market so that's factoring
in differences in cost of living/cost of golf as we cross markets
(unlike NGF where Manhattan NY has the same price segmentation as Manhattan KS, go figure). Within Public-Regulation golf, the distribution between Premium/Value/Price is
36%/34%/27% which is skewed to Public-Premium (at the expense of Public-Value) vs. the national picture of 31%/47%/23%.
Using our new methodology for calculating Supply/Demand
equilibrium and how the picture has changed from '00-'19 based
on rounds demand change vs. supply change, you can see in the
table above that Supply expanded 12% over that period, very
similar to the national average of 11% (a Compound Annual
Change Rate (CACR) of roughly 0.6%). On the facility-reported rounds demand side of the equilibrium equation, that supply
expansion is juxtaposed to a 14% rounds demand decline over
the '00-'19 period (2x the -7% US result). The confluence of
these two factors results in the cumulative supply dilution resting
at -27% or considerably more diluted than the national benchmark of -17%. This suggests that Philadelphia could lose 72, 18
hole golf courses and that outcome would just get them back to

their '20 equilibrium level (Holy absorption, Batman!).
Looking at the productivity of the average facility using our
proprietary velocity measure, they produce just over 25K rounds
per year which is modestly below the national average. Applying our industry-exclusive Utilization measure (played rounds/
capacity rounds), we see that after weather adjustment the market fares slightly better with a 44% Utilization Rate which is
slightly above the national average of 42%.
In summary, on the plus side of the ledger Philadelphia benefits from having a solid golfer base and average " factory productivity " (velocity and Utilization). On the other side of the ledger,
they're still considerably " hung " with too much supply, the balance of that supply is too heavy to Private (where it appears the
majority of that 72 facilities " overhang " could be sourced) and,
like many other US markets, they've struggled in creating rounds
demand. I'm sure that COVID is helping the latter, Golf Datatech is reporting them +30% for September and the state is up
8% for the YtD. None of these are particularly unusual or insurmountable obstacles. Keeping the rounds demand momentum
in '21 will be the key challenge but, hey, we now a lot of folks in
the City of Brotherly Love that will have a lot of discretionary
time on their hands post-January 20, 2021; perhaps we could
take all that energy and aggravation and direct it at a little white
ball instead of each other. Not likely but we just thought we'd
have a little fun with the concept...
If you'd like more detailed market profiling on any US geography, you can order a Golf Local Market Analysis specific
to that location or market. If you'd like a broader overview
of the largest and strongest US golf markets you can order
the '19 update of Pellucid's Top 25 US Golf Markets Health
Scorecard and be better informed with rigorous, broad independent facts.
n

" Clear Solutions to
Golf 's Business Issues "

Visit our website and register for more information and free sample reports at www.pellucidcorp.com.
Or, contact Jim Koppenhaver to discuss your unique needs at jimk@pellucidcorp.com or 847.808.7651

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THE PELLUCID PERSPECTIVE

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The Pellucid Perspective - November 2020

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