Shop smart

A golf course is a business and it takes money to run a business. Most superintendents are not privy to the bigger picture of the finances of a club. The most important financial item to understand is cash flow.  Depending on what climate a golf course is in the need for fertilizers, wetting agents, fungicides, insecticides, and seed may align with periods of high cash flow or could also happen during the off season.

Once you understand the cash flow of your facility and also the concept of line of credit you can more easily see how to take advantage of programs like Early Order Programs or EOP’s.
• There is a cost to borrow money from the bank that may affect your decision making for Early Order Programs. If the cost is 8 percent and the discount is 15 percent it may be worth your while. Know the rules of the game and have an in depth discussion with your club officials.
• EOP’s are normally sent out in September of the year. The purpose is to buy plant care products that will be utilized in the following year. For northern courses this would mean confirmation of purchase before the year end with delivery in the spring and a variety of terms for payment from March through June in many cases.
• Depending on volume savings can be as great as 15 percent. Most of the major manufacturers have programs in effect.  The greater the volume of your purchase the better the terms and the pricing.
• Most EOP’s are a detailed agreement. However, there is sometimes room for items like storage of the EOP supplied products by the distributor until the golf course needs the product. That is an agreement between the golf course and the distributor.

• Not all EOP’s are equal. They may be similar but not all have the same terms so shop wisely.
• Some superintendents may buy about 50% of their products on an early order and then get the other half during the summer to spread out the expense. That is an option and it is important to understand the cash flow of the business.
• In some parts of the country there are buying co-ops that work together to achieve the appropriate volume to maximize discounts.  Deliveries go to individual clubs as do billings.  The larger the volume the greater the discount. This has been utilized smartly by the multiple course operators for years.

A budget is a fiscal plan and a guideline for expenditures for the upcoming year.  Superintendents are more often being judged on their fiscal acumen and managing their budgets to achieve optimal results.  When you prepare and manage your budget well it is much easier to make proposals with confidence that will result in getting the resources you need to succeed.

Bruce Williams is GCI's senior contributing editor.