Three balls - or a club
Mr. Buffett has played REAL golf for many years, and it would be great to know what this shrewdest of investors pays for his golf equipment, and how often he changes it? Is he getting value from the price he pays? And do we?
What a ball used to cost
Back in 1902, when the first rubber core balls were introduced, most balls had a selling price of half-a-crown. At today’s prices that would be just over £12 ( US$20 ) – so losing a ball was much more of a disaster than now. These days, almost anywhere in the world, a good ball won’t cost more than £3 . Even less in the USA.
By 1921, when the Royal and Ancient G.C. and USGA first regulated the ball, half-a-crown was still the selling price – but economies of scale and inflation had brought the cost of a ball down to less than £5 in today’s money.
So, in relative terms, the price of a golf ball today is a lot less than it was a hundred years ago, although that hasn’t changed so much since the war.
Clubs were cheap as well...
Good news – until we start to think about the golf clubs. Back in 1902, a handmade hickory from the pro’s shop was expected to sell for about 7 shillings 6 pence (or three half crowns). So a club cost three times the price of a ball!
If that ratio still applied today, we’d be paying less than £10 for a club.
Not any longer
But we’re not. We’re paying as much as £350 for an all-bells-and-whistles driver ( which we’re told needs replacing every 6 months or so ). Again, prices are somewhat lower in the USA, but you get the point : this driver is costing 100 times the price of a ball. You can see why so many firms have gone into the club making business.
REAL golfers pay the price
What has caused this massive hike in relative prices? Could it be large research and development departments, huge marketing budgets and expensive endorsement contracts with TOP players? Surely it’s not all profit margin?! Either way, REAL golfers are paying the price for all of it. And yet how much value is really being added to our game? Do we all suddenly become scratch players?
And don’t forget that because of expensive technology we’re also paying for the increased costs of a round, caused by stretched courses, higher maintenance costs, plus slower and fewer rounds which generate less revenue. Yes, higher subscriptions/dues and higher green fees are the extra price for chasing the tails of technology.
Costs for new players
There are, of course, many other components which the would-be golfer is asked to consider buying – power trolleys/carts, enormous bags, shoes, clothing, rangefinders and so on. We are not against technology – in almost any pastime, there are always enthusiasts who will buy “the latest or the best”. But where does all this end, in terms of costs to new players? Easy to spend £1000 on the game before a new recruit has the faintest idea whether he or she will stick with it. Is that how we grow the game?
If we’re serious in REAL golf about tackling the “too slow, too difficult and too expensive” dilemma then this is one part of the equation that must come under the spotlight. There is a glimmer of hope in the modern trend away from matched sets, so that “the bag” comprises a more eclectic ( and perhaps smaller ) mix of woods, hybrids, irons and wedges. There is much to be said for customising and fitting clubs to an individual’s needs. As Vardon put it “The acquisition of a set of clubs, each one of which enjoys the complete confidence of its owner, is not the task of a week or even a year…”. The pro’s shop still has a crucial part to play here.
Not enough value
However, we can’t escape the fact that there is no bottomless pit of potential recruits willing to pay fancy prices, and too many existing players are not getting enough value from all this technology – or the game - to stay with it. Either they never start – or they never finish. They just give up.
Over the next year, we'd like to hear your views on this subject, and your ideas on how to roll back the costs of REAL golf. You are the consumers – and you will always be right. But first, you must be given a voice that can be heard.
We can only hope that Mr. Buffett is not invested in too many club making businesses.