Like all businesses, your club can benefit from a periodic review of its operations. Such reviews can help identify areas of opportunity for improvement that ultimately can lead to more satisfied members and better bottom line results. The review can encompass all areas of club operations or target specific departments that have been identified as needing special attention. From our experience as accountants and consultants to the hospitality industry in general and clubs in particular, we have noted the following areas of club operations where such reviews can have significant positive impact: Read the rest of this entry »
Making Financial Statements Meaningful
One of the most effective ways to make financial statements more meaningful for any industry is to adopt a uniform system of financial reporting. For example, in the world of private clubs, we have the “Uniform System of Financial Reporting for Clubs”. Under such a system, a chart of accounts and financial statement format has been developed that provides specific data for all significant departments of club operations. Read the rest of this entry »
Engineering Menus to Control Costs
In order to help offset the impact of increasing food costs there is an alternative to the unpopular step of simply raising your menu prices. Consider instead a concept often referred to as “menu engineering”. Under this common sense approach, menus are evaluated seasonally to help determine the most popular and cost effective items on the menu. To begin, you will need to review your point-of-sale system data reflecting menu items sold and you will need to know your “theoretical” or target cost for each menu item. The idea is to adjust your menu offerings to eliminate the more unpopular and unprofitable items, ideally replacing them with more profitable and presumably also more popular ones. Read the rest of this entry »
The Importance of Club Benchmarking
Whether you refer to it as benchmarking or comparative analysis, measuring the operating results of your club against available industry data is one way to highlight areas of opportunity for improvement at your club. When performing such an exercise, it is important to carefully select the data to be used for benchmarking. Operating data can vary from region to region in the United States and can be affected by elements such as local economic conditions or climate. Read the rest of this entry »
Making Financial Statements Meaningful
One of the most effective ways to make financial statements more meaningful for any industry is to adopt a uniform system of financial reporting. For example, in the world of private clubs, we have the “Uniform System of Financial Reporting for Clubs”. Under such a system, a chart of accounts and financial statement format has been developed that provides specific data for all significant departments of club operations. Read the rest of this entry »
Managing Minimum House Charges
Club managers and members alike can debate the effectiveness of their club’s minimum house charge policies. On the one hand, those in favor of the minimum concept argue that members who do not support their club’s restaurant through regular use should pay what amounts to an additional dues charge to help defray operating costs. On the other hand, members rushing to meet their minimum requirement at month end can overwhelm the club and its staff resulting in an unsatisfactory experience for all concerned, both members and staff alike. Read the rest of this entry »
Getting Ready for Healthcare Compliance
The following is a brief summary of provisions likely to impact clubs in 2013:
- Withholding of additional Medicare tax of .9% on wages or compensation of over $200,000. Clubs that pay employees such as the greens superintendent and or general manager in excess of this amount, should update their payroll system or be sure their payroll processor is ready to comply. The good news is that there is no employer match of this tax as there is with the regular Medicare tax.
- Reporting of aggregate cost of health insurance is required on 2012 W-2’s (to be filed in 2013) if the club filed over 250 W-2’s for 2011. Provision to comply should be made now to avoid the end of year rush if your club exceeds the 250 W-2 threshold. Read the rest of this entry »
Member vs. Nonmember Income
All private clubs whether they are taxable (Sec. 277) or exempt organizations (Sec. 501(C)7) should properly classify and document all nonmember revenues in connection with the preparation and filing of their annual tax returns. Monitoring member and nonmember income provides a club with the records it needs to help protect its tax status during an audit. There are several basic rules to remember when classifying revenues. Read the rest of this entry »
Managing Food and Beverage Inventory
We frequently note that some operators limit their food and beverage inventory management actions to mere tabulation at month end for financial statement reporting purposes; when in fact the inventory process can and should provide much more important information. Each inventory taking process should be seen as an opportunity to observe the following: Read the rest of this entry »
Managing Your Payroll Costs
Payroll costs at most clubs are impacted by many different factors such as:
- Hours of operation
- Member service requirements/standards and related staffing guidelines
- Nature of club facilities and services offered
- Competitive wage environment
- Union labor agreements Read the rest of this entry »
