February 2008

Outsourcing
The benefits of

Parys
Rediscovering

Also in this issue

• Setting the standards • Security
• E-mail letters • Stressful times
• Leasing • Tax on clubs • Discrimination
Volume 4 Issue 2
A monthly business-to-business Visit www.compleatgolfer.co.za
magazine for golf clubs, brought to you by for back issues of GCM
 CONTENTS OUTSOURCING

Outsourcing: a
LEAD STORY
Outsourcing  4

COURSE MANAGEMENT

possible solution for

Stressful times on the golf course 7

MARKETING
E-mail Newsletter Marketing 8

the club industry

CLUB PROFILE
Parys Golf and Country Estate 11

SECURITY
Is there more to security than
manned guarding? 13

CLUB PROFILE Is outsourcing an opportunity for or a threat to the golf

club industry? Ian Leach of Euphoria Golf Estate looks
Expering leases: Threat or opportunity? 16

at the benefits and pitfalls of outsourcing, and identifies

course management
Setting the standards 17

taxation some of the things to consider before taking the plunge.

Tax on Reacreational clubs. Part 3 18

HR LEGAL
In today’s business environment, strate-
Discrimination 21 gies will be developed around the concept
of outsourcing some of the club’s func-
BIRDIES AND BOGEYS
Snippets 22
tions deemed “non-core”, or where trying
to attract the appropriate skills is proving
security difficult. The process of outsourcing certain
Raising standards in the security industry 23
elements within the club has proved cost
effective with the “outsource partners” con-
tributing positively to the club’s operating
Cover picture by Peter van Onselen: skill’s base and membership satisfaction
Looking across the 14th green at Parys surveys. If you are considering outsourcing
towards the Vaal River. See our club profile at your club, here are a few pointers learned
on page 11. in the school of “hard knocks.”
Being a club manager, or an involved
and interested committee member, the chal- For more information on outsourcing
■

Editorial 
ANDREW WILSON lenges facing you are significant. Increased contact Ian Leach on 08289286693
email: consultaew@iafrica.com competition too attract golfers, increase or at ianleach@euphoriaestate.co.za
cell: 082 575 3861
food and beverage sales, control labour
■ AdvertisinG costs, develop staff quality, keeping up with tions not integral to the club’s mission should
Simon Turck
(PUBLISHER) computer technology and managing limited be outsourced. In other words outsourcing is
email: simon@rsp.co.za capital resources; all have to be dealt with. the procurement of a product or service once
cell: 083 252 8387
Today’s manager should focus on core managed internally but now provided by a
■ AdvertisinG member services. In many clubs conven- specialist from outside.
TYRON MARTIN
(ADVERTISING EXECUTIVE) tional wisdom still prevails to maintain Outsourcing offers many benefits, the
email: tyronm@rsp.co.za tightfisted control over all the functions of most important being the opportunity to
cell: 083 235 7509
the club. The old model of the department obtain timely and expert quality services
■ Advertising store of the ‘60’s, where everything was at lower costs. Outsource service compa-
James Ferrans
(National Sales Manager) under one roof, is being replaced by the nies are still finding their direction in the
email: jamesf@rsp.co.za concept of the club as a general contractor club industry. Those that have, achieve a
cell: 084 252 6373
responsible for hiring the sub-contractors competitive advantage because they are spe-
■ SUBSCRIBE to GCM for R240 a year. it needs to do defined jobs. This approach cialised and understand the requirements of
Contact Natalie Shekleton
tel: 011 301 4448 allows management to focus on its primary the club.
email: natalies@rsp.co.za responsibility – serving the social and rec- The long-held notion that internal super-
Visit our website www.compleatgolfer.co.za reational needs of the membership. vision can provide the greatest amount of
A SWOT analysis should be conducted management control over the club’s opera-
A monthly
business-to- on all the functions of the club to consider tions is now open to review and debate.
business magazine
brought to you by
their efficiency and productivity as well as Peter Drücker calls this structure a defective
their strategic value to the club. Those func- monopoly, as the department has little incen-

 February 2008 Golf Club Management


tive to improve its efficiencies whilst an
outsource company will attempt to ensure
member satisfaction without adding to the
cost. Outsourcing is indeed a powerful tool.
In essence, outsourcing involves dele-
gating to a third party the responsibility and
authority for managing an element of the
club’s business at an agreed fee for a fixed
period of time.
Many clubs have already introduced an
“outsource partner” in the form of a security
company, housekeeping services, golf course
maintenenace, and/or landscape gardeners.
However clubs will eventually start investi-
gating the services of payroll administrators,
HR management, membership accounts,
food and beverage management, pro-shop
management and golf cart management.
Let us consider some of the reasons for
outsourcing:
1. A reduction in, or a better control of,
operating costs are probably the most
compelling reasons in the short term.
With labour costs continuing to escalate,
already a major cost centre, a carefully
negotiated contract should yield signifi-
cant savings in labour costs and head
count alone.
2. Through outsourcing, a club is able
to acquire resources not available
internally.
3. Outsourcing improves club management
focus. Outsourcing does not mean the
abdication of management responsibili-
ties. On the contrary, working with the
club’s “outsource partners” gives the
management of the club the opportunity
to concentrate on problem areas while
maintaining overall control of the club.
It can be a revelation to all at the club
just how easy it is for all parties to form a
working relationship in the best interest
of the club.
4. By choosing the right “outsource part-
ners” you can gain access to best practice
South African capabilities. Many out-
source providers bring extensive top
class resources to meet the needs of the
club and its membership.
5. When a club outsources, the chances are
that it will change its management style.
It will become more flexible, dynamic
and better able to take advantage of
changing market forces.
As Tom Peters says, ‘Do what you do best
and outsource the rest’. Most clubs have lim-
ited resources, especially skills and finances.
By outsourcing, a club is able to redirect
resources, concentrating on those areas that
require intense management focus.
How do you decide on an outsourcing
option?
Be careful about going the outsourcing
route when:
• members and committees are involved
in all aspects of the club’s operations
and have long term objectives to provide
the function internally,
• there may not be qualified outside
providers,
• staying in-house has a clear competitive
cost advantage over outsourcing.
Consider outsourcing under the following
circumstances:
• members and the committee are con-
cerned with the quality of the end
product and not the process of delivery,
• the capability to perform the functions
are available to the club in the market
place,
• companies specialising in functions
that the club can use are clearly more
competent,
• the club does not have the capital
resources needed to implement the
required function,
• the club management can clearly demon-
strate that it will be introducing superior
technical, management, production and
financial capabilities,
• there is a close culture fit between the club
and the proposed “outsource partners”.
Many club managers believe that cost
savings are the prime motivation for out-
sourcing. Whilst this fact will have a strong
bearing on your decision consider carefully
the following when choosing a vendor:
• culture fit
• commitment to quality
• resources
• reputation
• acceptable contract terms
• ability to add value
• cost effectiveness.
Continued on page 15
OUTSOURCING
A comment from Harry White, chief
executive officer of Steenberg Golf
Club in the Cape.
S o often we hear the comment that
golf clubs, and in particular the
administration of golf clubs has changed
to such an extent, that this function now
resembles that of a fully fledged busi-
ness. In many of our clubs this is indeed
the case and I personally believe that for
clubs to be successful in the long term
this transformation is imperative.
When we therefore consider busi-
ness options, of which outsourcing is
only one of many, we need to do so by
weighing up the same factors that any
other business would i.e. operating costs,
specialized skills/services, resources,
labour and business focus. Like in any
other business the decision to outsource
will differ depending on many factors
and will rarely be the same for any two
clubs.
What is important though, in the golf
club industry, is that the club’s unique
brand identity is upheld. Having subcon-
tracted selected operational functions
within the club, management’s biggest
challenge is to project a unified brand
identity that conforms to the clubs
criteria.
Outsourcing is an option that deserves
serious consideration, and in many cases
is simply a “no brainer”, but I want to
stress that it must be considered within
the best business practice context for
your specific club, and not chosen as
an easy option to evade administrative
responsibilities.
The Club Management Association
of South Africa (CMASA) is a valuable
source of data to clubs and can provide
management with a variety of outsourcing
options. Beryl Acres of the CMASA can
be contacted on 011-482 7542 or by
e-mail at gm@clubmanagement.co.za
Golf Club Management February 2008 

Stressful times
on the golf course
Greens can also suffer stress after the busy festive period! Murray Veitch of Turftek
identifies some of the causes of and solutions to stress on greens during the warm
summer months.
With the demand for faster and faster green
speeds, ever more stress is being put on our
putting greens as well as the people whose
job it is to try and keep the greens alive
during the stressful times.
The greater the stress, the more the chance
is that diseases will develop.
During warm periods the first signs of
stress on your putting greens will be the
change of the grass colour. Bent grass espe-
cially starts to turn a slight purple colour.
If the condition that is causing the stress is
not corrected the greens may wilt and die.
Generally the whole green does not stress
all at once, but instead you have patches
stressing at a time. Low cutting heights is
not the only reason why greens start to
stress. There are quite a few reasons.
Thatch layer build up
If regular cultural practices such as verti-
cutting, topdressing and aerification are not
carried out, a thatch layer will build up in
the top layer of the greens. This thatch layer
becomes like a sponge which holds onto any
water that is applied to the green and does not
let it move through the soil profile to the root
zone where it is most needed. Quite often
after heavy rains the greens start stressing
and no one can understand why because the
greens must be wet because of all the rain.
A quick soil sample using a probe will show
you that the green surface is wet but not the
root zone.
Too often cultural processes are put on
hold because the golf course is too busy.
The consequences of missing these vital
processes are seen in the form of stress on
the greens and can only be rectified by more
severe cultural practices.
It is therefore vitally important that
everyone involved in decision making on a
golf course understands the importance of
regular aerification.
Compacted soils
It stands to reason that greens which are
overly compacted will not let water penetrate
into the surface. A sure sign that the greens
are becoming quite hard is the puddling of
irrigation or rain water on them. The water is
not absorbed by the green but instead flows
over the surface. Irregular dry spots on the
greens will be the result.
Regular tining of the greens will insure
that there is always a way for water to move
down to the root zone.
If regular cultural
practices such as
verticutting, topdressing
and aerification are not
carried out, a thatch layer
will build up in the top
layer of the greens.
Hydrophobic soils
Especially on sand based greens hydro-
phobic patches may occur. These are patches
on the green which don’t absorb water but
instead repel it and are referred to as local-
ized dry spots. The reason for the occurrence
of these hydrophobic or localized dry spots
COURSE MANAGEMENT
may be due to a number of things. One of
the reasons is that a fatty layer coats the soil
particles making it impossible for the water
molecule to attach itself to the soil particle.
The use of a wetting agent is the primary
tool used in the fight against localized dry
spots caused by water-repellent soils. Studies
have shown that it is better to initially treat
the entire green with a wetting agent, than
just targeting the dry spots. Once the entire
green has been treated then the individual
spots can be treated.
Irrigation coverage
Where possible, irrigation systems should be
designed so that the sprinklers throw head to
head. Localized dry spots may be the result
of poor irrigation coverage which may be a
result of poor design or even bad pressures.
It is a good idea to first check that the irri-
gation coverage on a green is correct before
trying to look for other reasons which may
be causing the dry spots on the greens.
Growing Bent grass greens in our warm
climates will always result in the greens
stressing from time to time. The reason may
be due to any one or more of the above fac-
tors. One thing that is guaranteed is that
the greenkeeper will also be experiencing
stressful times at some time or other during
the course of this summer.
For more information
on turf-related issues,
contact Murray Veitch
of Turftek on
012 807 7282 or at
leonette@turftek.co.za
Golf Club Management February 2008 
MARKETING
E-mail Newsletter Marketing –
The modern communications and
marketing tool
Graham Starkey – channel manager at RetailTribe – identifies the key criteria to con-
sider when developing e-mail newsletters as a marketing and communications solution.
The use of the modern digital super
highway, which now is not just the preserve
of our European and American counterparts,
is becoming more and more accessible here
in South Africa and is a cost effective tool
in modern golf club marketing. With the
‘Silver Surfers’ (the retired community)
being the fastest adoptors of computers and
the internet, this form of communication
is no longer just for the larger clubs with a
more youthful membership.
E-mail newsletters can come in a variety
of forms such as plain text mails, simple
generic e-mails or as a total solution.
E-mails are designed to match and support
your club’s current corporate identity, with
access to e-commerce strategies and even
personalised websites to aid retailing.
What to consider
If you and your committee are looking at
using an e-mail newsletter to communicate
with your members or as tool to keep in con-
stant contact on a weekly basis these are the
things to consider.
• As an e-mail newsletter goes directly to
your customers each week, it is far more
effective, let alone more professional,
than the traditional paper newsletter that
is still common place.
• A weekly newsletter allows you to drip
feed information to your community and
repeat key dates or events over a number
of weeks. Any form of monthly news-
letter reduces the flow of information
and prevents you from responding to
sudden local issues, or to post important
notices.
• This form of e-mail communication also
allows you to receive feedback from your
community in the form of questions,
statements, suggestions or responses
 February 2008 Golf Club Management
to articles posted. This allows you to
be seen as more open and transparent
and enables you to nip any negative bar
chatter as soon as it begins.
• Identify the club’s departments that
could, should, or would like to con-
tribute to the newsletter. From the club
managers to the green’s staff and from
the golf shop to the food and beverage
sections, each can have their weekly say,
monthly or as frequently as they/you
wish in order to give more of a flavour
of what the club as a whole has to offer.
• The database you will no doubt be col-
lecting should be that of your total
community and patrons. From the resi-
dent local golf club membership to the
international and local seasonal visitors,
along with the frequent or infrequent
Graham qualified from
University with a BA
(Hons) degree in Leisure
Management and has
since then worked in
golf for both the UK’s
largest high street golf
retailer for 2 years and then UK’s big-
gest on-course golf buying group for
8 years. At ‘American Golf’ Graham
was development manager in charge of
opening all new stores and at ‘Foremost
Golf’ he assisted the group’s on-course
professionals with their retailing, mer-
chandising and business planning. In his
final 2 years with Foremost he launched
an e-mail newsletter solution to over 70
clubs. Graham arrived in South Africa in
January 2007 and has been welcomed by
both pros and club managers alike.
golfers that pay a green fee and play the
course.
• Consider the marketing objectives that
you and your club wish to achieve. Do
you just want to have a ‘news’ letter or
more of a marketing tool that will help
drive sales?
• Do you want to view the mails as just a
stand alone solution or do you want to
offer more to your members in terms of
e-commerce?
• Do you want to access or have the ability
to generate advertising revenue from
local sponsors that could ‘partner’ your
mail and give you benefits of synergy?
Opportunities to generate revenue from
the newsletter
Correctly written newsletters have been
proven to help increase rounds and bar rev-
enues, (just ask Dale Hayes – a pioneer of
this form of e-mail communication).
Promoted on an on-going basis there is
the real prospect of an increased use of club
facilities.
If promoted weekly, instead of a notice
placed on the club notice board and ignored
by the vast majority of club members, an
increased participation at club events is a
real possibility.
If you are looking for increased sales
through your pro shop, the addition of a
shop section or golf product or pro specific
articles within your mail is a must.
Advertising revenue generated through
local small and larger companies that can
provide services to your membership will
give an added community feel.
If you have a shop run by the club how
can you increase sales?
With a weekly mail-shot you can react

to new product arrivals, new offers, have
product auctions and highlight demo and
sales events. If you have a PGA profes-
sional on site then highlighting how they can
help your membership improve their game
through course tips, swing thoughts and, of
course, custom fitting will generate more
engagement in what the club can offer from
a golf retail perspective.
Golf as a product brings the golf club’s
community together, so within your e-mail
newsletter consider (when the opportunity
arises) educating your golfers about golf and
the latest trends in golf products. This can
get golfers asking more questions of your
shop staff/PGA professional, thus more time
is spent at the club, leading to more rounds
played and more food and beverage pur-
chased before, during and after their game.
For more information on e-mail news-
letters and solutions, contact Graham
Starkey at RetailTribe on 021 880 2693,
e-mail him on grahamstarkey@
retailtribe.com or visit www.retailtribe.com
MARKETING
Who is RetailTribe?
RetailTribe manage, on behalf of various golf pro-
fessionals and golf clubs, 65 e-mail newsletters in
South Africa and over 120 in the United Kingdom.
Each week RetailTribe sends out more than
100 000 e-mails to golfers, members and patrons
of these clubs. South African clubs consist of
estate courses, Leopard Creek and Pearl Valley to
name a couple, as well as members’ clubs such as
George and Reading Country Club. 
RetailTribe aims to close the gap between the
club/Pro shop and the customer, by providing
informative weekly content which is club spe-
cific and carries strong community interest
to the reader. The email also encourages the
recipient to interact with the golf professional
on a regular basis and in this way places the
golf club in the forefront of the reader’s
mind.
RetailTribe has successfully managed to
gain substantial retail benefits for the club/Pro shop by
leveraging the click-to-reserve or click-to-order hybrid commerce solution
with the key factor being that the product is picked up at the golf club strengthening/
cementing the club and member relationship further.
"Your complete media partner in golf"

PUTTING YOU ON COURSE


Rediscovering Parys
It’s quaint, it’s quiet and there is a real sense
of bushland about the newly-developed
Parys Golf and Country Estate. On the land
of the original Parys Golf Club, Parys Golf
and Country Estate has transformed and
remodelled their entire golf course. With
a complete redesign by renowned golfer
Cobie Le Grange and assisted by Douw
van der Merwe, the course is soon to be a
major attraction for residents and visitors to
the area. Barely an hour from Johannesburg
lies this almost forgotten piece of real estate,
once frequented by travellers on the old road
to quaint Free State towns en route to Cape
Town.
Mark Truter has been appointed golf
director and assigned with the task of
reigniting the golf department and attracting
the former members back to the club.
Closing an existing golf course down for
complete reconstruction comes with many
complications and drawbacks. Building up
tradition in a golf club with a festive, friendly
atmosphere does not happen overnight. Mark
identifies for us some of the problems associ-
ated with a course re-opening and possible
solutions to these issues (see table below).
Making the experience memorable.
One of the challenges facing any club man-
agement is how to make the experience
Problems
• Getting the original Parys Golf Club mem-
bers back to the course after the redesign
and playing regularly.
• Retaining the original memberships.
• Many of the old members have not even
seen the new course.
• Educating players in ‘golf cart etiquette’
– people just seem to drive the golf carts
anywhere they like!
• Outdated accounts and check-in systems.
The system was operated manually until
recently with an outdated database and old
electronic equipment.
• Getting golfer’s heads around paying
slightly more for a vastly improved golfing
facility.
Having closed a course down for complete
reconstruction, how do you win back the support of
previous members. Peter van Onselen of GCM went
to Parys to find out.
memorable. So what has Parys done to
achieve this? With spectacular views and
a challenging design, the course offers a
distinct experience to everyone who plays
it. The 18-hole course winds its way unob-
trusively through the estate and along the
banks of the Vaal River. A unique character-
istic of the estate is that it actually exists on
an island surrounded by the river. The front
nine has the river constantly down the right
hand side and after you make the turn, the
river remains down the right hand side. It’s
remarkable how the kikuyu fairways and
Solutions
• Use the NS2 network system to inform
the previous members of the club about
the new improvements and upgrade.
• Ensuring the course is kept in the best
possible condition – especially the
putting surfaces.
• Make the club as cost effective as
possible for members and visitors
including bar prices and green fees.
• Upgrade equipment to ensure the
smooth running of all departments in
the club.
• Maintain a high level of discipline and
enforcement of the rules in the club-
house and on the course.
• Encourage mid-week corporate golf to
promote the Parys experience.
CLUB PROFILE
bent grass greens have taken to the course
in the mere six months the course has been
open. If you tend to hit the ball with a vicious
slice you will be donating many balls to the
Vaal River.
To soften the pain for slicers, the babootie
and rice with salad for R20 at the halfway
house adds to the memorable experience
and should keep people coming back for
more. It’s little things like that, which don’t
cost lots of money, that can leave a lasting
impression in golfer’s minds.
Some club stats:
• There are 475 freehold stands on the estate.
• There are 380 registered members
• Green fees for affiliated golfers is R110
• Membership fees are R2350 per annum
• Entrance fees are R1500
• Bar and pro shop prices are hugely com-
petitive in comparison to 'big city' golf
courses and more established golf estates.
Mark sees the key ingredients for success as
being:
• ensuring a happy, supportive membership
• ensuring visitors are made to feel as wel-
come as members
Parys Golf and Country Estate are
certainly on the right track with a really
entertaining layout and high level of play-
ability backed up by top levels of service
and excellent value for money.
For more information on Mark Truter see
Birdies and Bogeys on page 22.
Golf Club Management February 2008 11
Over 150 Courses Can’t Be Wrong

For a live demo visiti www.eluminaiberica.com

or contact carrie@elumina.co.za
or telephone Carrie Teale 0829093118

Is there more to security
than manned guarding?
Is it a question of either/or when considering CCTV and manned guarding for your
clubhouse and course? Jacqui Bothma, general manager of Peaceforce Security, gives
some advice to GCM readers on the synergies that can be gained from both.
Whenever CCTV monitoring or camera
surveillance is mentioned, there are many
mixed reactions. Some people have
implemented this type of technology very
successfully while others have tried and
failed.
The debate continues as to whether elec-
tronic surveillance technology would one
day replace manned guarding as the solu-
tion of choice for protecting property and
assets. It is obvious that this technology
has improved and become more reliable
but the biggest barrier to implementing a
decent system is still cost.
The cost of manned guarding has risen
dramatically over the past few years due to
varying factors such as minimum wages,
statutory memberships to provident funds,
increased training etc. While all of these
things are very positive, it has definitely
contributed to the increased costs.
In addition to cost, there is the emotive
issue of trust. Wherever manned guards are
deployed, there is always the potential for
deception. Human failures being what they
are, temptation is often difficult to ignore.
There is also the question of dependability.
Understandably, guarding is not an easy job
so it is not unheard of for security officers
to fall asleep on the job, putting both them-
selves and the premises they are protecting,
at risk.
There are however a number of ben-
efits to manned guarding. Having security
officers on site offers a certain sense of
security and it is generally more convenient
for taking deliveries, for example, outside
of office hours. Security officers also act as
a deterrent as opportunistic crimes gener-
ally happen when there is no one physically
present.
Having uniformed officers on site
offers a certain sense of security.
Wherever manned guards are
deployed, there is always the
potential for deception.
Security tip of the month
Be extra vigilant when doing banking -
especially when drawing and depositing
large sums of money.  Vary your routine
and route as often as possible and do not
let people know when you are going to
the bank.
A remotely monitored CCTV solu-
tion has a range of benefits over manned
guarding. It is more reliable as it is always
on duty and it is also more effective.
Security officers can only be in one place at
one time, whereas monitored cameras can
view multiple incidents, respond to mul-
tiple alarms, and direct resources to those
alarms accordingly. Monitoring means
having the ability to deal not only with an
SECURITY
event on site, but also, being able to liaise
with and direct response officers or other
emergency services without putting them at
unnecessary risk.
A word of caution though; the use
of technology is not a matter of simply
replacing manned guarding with tech-
nology. Manned guarding and CCTV
monitoring can work effectively together.
Technology can reduce the number of
guards required on a site by helping make
those that remain, more effective. It can
direct them to incidents as they occur, for
example, and perform random patrols elec-
tronically, rather than physically. On a golf
course, cameras can be strategically placed
to monitor intrusions or breaches of secu-
rity around the perimeter or where guards
would normally be required to patrol. This
offers the security of always having those
vulnerable points covered. This should be
complemented with manned guarding at
the entrance and exit points. The moni-
tored cameras can also provide a reliable
eye on the security officers.
It may be worthwhile to ask a reputable
company to do a complete risk assessment
and provide recommendations to combine
technology and manned guarding. While
it could be costly initially, if it is managed
correctly, it will be more economical, reli-
able and effective in the long term.
If you would like more
information feel free to
contact Jacqui Bothma
on 0861 739 739 or visit
www.peaceforce.co.za
Golf Club Management February 2008 13

Continued from page 5
Why would vendors consider the club
industry as a business opportunity?
There are several factors. A shift in
thinking is taking place amongst developers
in the golf estate industry. These developers
have changed conventional club manage-
ment thinking and vendors now see the
opportunity to modify their product offering
to meet the requirements of club manage-
ment. After a slow start, when both sides
were re-engineering their business models,
there is now a growing acceptance of the
many benefits that outsourcing has to offer.
Many clubs and estates have outsourced their
golf course maintenance, housekeeping,
club house maintenance, security and land-
scaping with success. Other products are
now starting to come on to the market. Our
American colleagues have additional prod-
ucts to choose from including:
• human resource management
• payroll processing
• membership billing
Interestingly, whilst some South African
clubs are outsourcing their pro shops, our
American friends consider pro shop sales as
a lucrative and an important element in the
club’s cash flow
It is important to realise that to outsource
means outsourcing the right things and not
outsourcing everything.
Club managers and club committees must
look for growth based on specialisation, on
expertise and overall course and club excel-
lence. It is growth based on three things:
1. focusing on those areas that most directly
contribute to the club’s success,
2. distinguishing itself in its local market
place and
3. excelling in the eyes of its membership.
How will management react to the notion
of outsourcing? It requires a significant
change in mindset. Managers fear the loss of
control and some feel very threatened. One
can understand these conflicts – I had spent
years building up a team that was now going
to be disbanded or so I thought. I was not a
happy camper until I started to understand
OUTSOURCING
the benefits to the club in the long term. I
stopped being a spoiler – ensured that I knew
more about the process than anyone else and
became totally involved with our “outsource
partners”. The club has never looked back. ■
Comment from GCM:
Under certain circumstances outsourcing
has distinct advantages, as outlined in Ian
Leach’s article and supported by Harry
White’s comments (see pages 4 and 5).
Readers need to be aware however that
there are a number of legal requirements
that have to be fulfilled when embarking
on an outsourcing process. For example,
it is not just a case of transferring your
current cleaning team to an outside con-
tractor, ensuring that they are no worse
off than before, and then continuing to
use them as if nothing had happened.
There have been a number of Labour
Court cases that have set precedent in this
regard. GCM will bring you legal com-
ment on outsourcing in our March issue.
club profile
Expiring leases; threat
or opportunity?
Hermanus Golf Club (HGC) turned the threat of an expiring lease into a huge
opportunity. GCM spoke to Hein Papenfus, who was general manager at the time,
to find out how they did it.
A considerable number of clubs are facing
expiring leases in the next few years. If your
club is one of them, you can take a leaf out
of HGC’s book. In 2004 they still had ten
years to go on their lease and decided not to
wait until it was too late, but to rather secure
their future while they still had time.
As a result of their efforts, HGC has
achieved the following:
• Originally they had hoped to secure a
99 year lease from the local council who
were the current owners. Now they own
their land free-hold providing it continues
to be used only for golf.
• They have been able to re-build their orig-
inal 18 hole golf course and add a further
nine holes.
• The whole project has cost HGC nothing
and they are now in a stronger financial
position than at any time in their history.
How did they manage to achieve this so-
called miracle? This is what Hein Papenfus
had to say.
The success of the process depended
on a number of factors. In 2003, the club
set up a development committee chaired
by Hannes Kleynhans, now President of
HGC. They established a memorandum of
understanding (MOU) with the proposed
developers Rabcav. It was then necessary
to approach the council with a view to
renewing their lease. It was at this point that
16 February 2008 Golf Club Management
Club stats:
Total number of members 1600
Full members 800
Length off Championship tees 6500m
Length off club tees 5800m
Number of annual rounds
pre development 55 000
Number of annual rounds
during development 34 000
the development committee became aware
of The Alienation of Sports Fields Act.
The Act allowed HGC to apply to the
council for the purchase of the 120 ha of
land that the golf course was on. Once the
application was submitted, the council had
to value the land in terms of the purpose for
which it was to be used, namely golf. The
applicant was then given an opportunity to
buy the land at half of the valuation. There
had to be an extensive public participation
process undertaken however, before the sale
could be completed.
The proposed sale had to be advertised
and objections listened to, evaluated and
dealt with. Every bit of water, above and
below ground belongs to the Dept of Water
Affairs. Their approval of the scheme had
to be obtained. They had to identify every
municipal service and servitudes had to be
issued. They had to set up an environmental
liaison committee focusing particularly on
the wetlands and the free movement of ani-
mals. The list was almost endless.
The key to the success of the whole
process was the nurturing of the relation-
ship between the three main players, HGC,
the local council and the developer Rabcav.
Communication was critical not only with
the three main players but also with the
members of HGC. As a result of the devel-
opment, 330 new residential stands became
available and 100 were made available to
HGC members on a “lotto” style draw. Two
hundred and forty HGC members and 610
members of the public applied for stands, so
interest was high and those lucky ones that
were successful have already seen signifi-
cant appreciation in their investment.
The end result has been a win-win-win
situation for all the three main players. HGC
now owns the land, at no cost to themselves,
which they once leased from the local
council. The council is receiving rates and
taxes from an additional 330 homeowners
and the developers, Rabcav, have completed
a very profitable property development.
For more information on Hermanus Golf
Club contact either Sharon Schwulst their
club manager, or Julian Shaw their golf
director on 028 312 1954 or go to their
website www.hgc.co.za
 COURSE MANAGEMENT

Setting the Standard

Looking for consistency in your maintenance programme? Darren Berry of Golf
Data believes that committing a well thought out programme to paper is the first step
towards maintaining standards and ensuring consistency.
The required or desired maintenance
standards vary on every golf course and are
dependant on many factors. These factors
include, but are not limited to, member or
golfer expectations, available resources, turf
variety, water availability and local weather
conditions.
For a modern golf course to be successful
it must be managed and operated like a busi-
ness. As in any business, a sound business
plan is a fundamental part of any potential
success.
This same idea should therefore be
applied to the golf course maintenance oper-
ation, where the drafting of a maintenance
standard guideline document will replace
the above mentioned business plan.
The golf course superintendent will very
often be the only one who knows what the
overall maintenance plan is and this plan
is, very often, only a vague outline. A well
structured, well written maintenance plan is
an extremely valuable tool to help improve
the overall maintenance standards of the
golf course. The maintenance plan should
contain a guideline for both the day-to-day
activities and the long-term goals for the
golf course.
Input for these guidelines should be sought
from all stakeholders including the golf
course superintendent, greens committee,
club members and golfers, club professionals
and club management. Producing a golf
course which provides the desired playing
conditions, while maintaining healthy turf-
grass should provide the core theme for any
maintenance plan. Superintendents should
always remember that a golf course is pro-
duced and maintained to be played on and
that golfer input is therefore a vital part of
the planning process.
One of the best arguments for the imple-
mentation of a written maintenance plan is
the provision of continuity. Committees or
club management may change on a regular
Quality implementation on the golf
course starts with a well written
maintenance plan.
basis and there may even be individuals who
have their own agenda in mind with regard
to golf course maintenance. These regular
changes or disruptions caused by the above
mentioned situation can be avoided through
the implementation of a sound maintenance
plan.
A written maintenance plan can be uti-
lized to help identify areas within the golf
course operation which require improve-
ment. The plan will also help to quantify the
necessary resources required to implement
the improvements. The maintenance plan
also has the potential to influence the clubs
bottom line as it can be used to identify areas
within the budget where resources are either
being under or over utilized.
A time/motion study of the maintenance
operation should be undertaken in conjunc-
tion with the maintenance plan, as it will
assist with the budgetary adjustment and the
allocation of resources. The maintenance
plan need not be a complicated document.
Start with the rudimentary cultural prac-
tices and a description of the desired quality
level.
A rough guide for any maintenance plan
may be to include the following:
• Cover page
• List of Contents
• Introduction
• Mission Statement
• (List of each section)
• Greens
• Tees
• Fairways etc
• Environmental issues
• Long-term improvement
An addendum can later be added which
includes the workshop maintenance stand-
ards and expectations. The inclusion of
pictures as examples of desired standards
or justification for suggested improvements
will help to communicate the ideas to the
club membership. Always be sure to dif-
ferentiate between different times of the
year or different seasons, when drafting the
plan, as maintenance practices will vary
considerably.
A written golf course maintenance plan is
vital to allow the club to be run as a business.
It maintains proper levels of expectation,
helps to allocate resources effectively and
provides consistency in standards from one
year to the next.
Darren Berry of
Golf Data can be
contacted on
083 671 9399 or (044)
384 0680/3
or at
darren@gdmaint.co.za

Golf Club Management February 2008 17

TAX LEGISLATION

Tax on recreational clubs Part 3

Jackie Arendse of Eagle Tax gives GCM readers a case study on how the partial tax
provisions and capital gains tax on recreational clubs will be applied in practice.
This is the third article in a three-part series certain types of income (for example, golf that all the direct costs (R4 000) incurred
dealing with the new tax rules for recreational course maintenance costs relating directly to in earning the rental income will qualify
clubs. In the first article I discussed the admin- green fees, costs incurred directly in respect of for tax deduction. However, as part of the
istrative requirements and in the second, I food and beverage sales and expenses incurred rental income is exempt from tax (see note
explained the new “partial tax” provisions in directly in respect of the rental income). 3 below), only the expenses relating to the
terms of which some, but not necessarily all, Other overhead expenses are allocated to the taxable amount of the income (calculated
of a club’s income may be exempt from tax. various types of income on a suitable basis. as a pro rata share – see note 4 below) may
In this article I will work through a case study In practice, this allocation may be done on be deducted for tax purposes. The taxable
to illustrate how the partial tax provisions will a Rand-for-Rand basis, on the basis of time income calculation will therefore appear as
be applied in practice and I will then discuss spent by employees on the various activities, follows: (See Table 3 opposite).
the capital gains tax implications for clubs according to the amount of space taken up
under the new rules. by each activity carried on by the club or on 1. Membership fees or subscriptions are
some other basis that is appropriate to the spe- fully tax-exempt.
Example cific club. In our example, overhead expenses 2. Playing fees and food and beverage
Our case study is based on a hypothetical have been allocated to income from subscrip- income is exempt from tax because
club that charges annual subscriptions to its tions, playing fees and food and beverage on a these activities are integral and directly
members and also derives other income in Rand-for-Rand basis. No expenses have been related to the core objectives of the club,
the form of playing fees (from both mem- allocated to rental and interest income as none they are carried out substantially on a
bers and visitors), food and beverage sales of the overhead expenses were incurred in cost-recovery basis (no significant profit
(to members and visitors), rental income order to earn this income. is made) and the club is not competing
from billboards and a cell-phone mast and The net profit of the club is made up as unfairly with taxable entities.
interest income from various bank deposits. follows (based on the club’s accounting 3. Rental and interest income is not specifi-
The club’s total income is made up as fol- records): (See Table 2). cally exempt and the general exemption,
lows: (See Table 1). The next step is to calculate the club’s being the greater of R50 000 or 5% of
The club incurs expenditure on main- taxable income, which will exclude income the total membership fees and subscrip-
taining its sports and social facilities and that is exempt and take into account income tions (5% x R400 000 = R20 000) is
also has various overhead expenses relating which is taxable. Expenses incurred in used against this income. The exemption
to the general running of the club. earning income that is taxable may be of R50 000 is shared pro rata between
The accounting system of the club has deducted for tax purposes, provided various the two types of income. Therefore, the
identified the expenses that relate directly to requirements are met. It is assumed here exemption for rental income is R26 923
(R70 000/R130 000 x R50 000) and
Table 1 the exemption for interest income is
Members Playing Food and Rental Interest TOTAL R23 077 (R60 000/R130 000 x R50 000).
subscriptions fees beverage income income
4. Of the R70 000 total rental income,
Income R400 000 R550 000 R300 000 R70 000 R60 000 R1 380 000 R43 077 remains taxable after taking into
account the general exemption (see note
Table 2 3 above). The direct expenses of R4 000
Income Members Playing Food and Rental Interest TOTAL relating to rental income are apportioned
statement subscriptions fees beverage income income between the taxable and exempt portions
Income R400 000 R550 000 R300 000 R70 000 R60 000 R1 380 000 of rental income, with the result that
only R2 462 (R43 077/70 000 x R4 000)
Direct costs -195 000 -100 000 -4 000 0 -299 000 of these expenses are allowed as a tax
Overhead -256 000 -352 000 -192 000 0 0 -800 000 deduction.
expenses The taxable income of R77 538 is taxed
at a rate 29%, with the result that the final
Net profit R144 000 R3 000 R8 000 R66 000 R60 000 R281 000
tax liability is R22 486.

18 February 2008 Golf Club Management

 TAX LEGISLATION
Table 3

Tax calculation Members Playing Food and Rental Interest TOTAL

subscriptions fees beverage income income

Gross income R400 000 R550 000 R300 000 R70 000 R60 000 R1 380 000

Less exempt
income (refer
notes below)
(1) -400 000 -400 000

(2) -550 000 -300 000 -850 000

0 0

(3) -26 923 -23 077 -50 000

0 0 0 R43 077 R36 923 R80 000

Less deductions No deductions against exempt income -2 462 0 -2 462

(4)

Taxable income 0 0 0 R40 615 R36 923 R77 538

Capital gains tax
The removal of the blanket tax exemption
for clubs has resulted in clubs now being
exposed to capital gains tax on the disposal
of their assets. Whenever a club disposes of
an asset it must calculate the resulting cap-
ital gain or loss as the difference between the
proceeds on disposal and the base cost of the
asset. The base cost of the asset is generally
the purchase price of the asset but there are
specific rules dealing with aspects such as
depreciation, costs relating to the acquisition
and sale of the asset and the determination
of the base cost of an asset that was acquired
before the new legislation became effec-
tive. Unfortunately space does not permit a
detailed discussion of these provisions here.
It is important to mention, though, that clubs
have been given special roll-over relief,
which means that they may defer the taxa-
tion of a capital gain on the sale of an asset if
the following requirements are met:
1. The asset must have been used mainly
(more than 50%) for the purposes of pro-
viding social and recreational facilities
of the club;
2. the proceeds from disposal of the
asset must be reinvested by the club in
acquiring another asset (or more than
one asset) that will again be used mainly
for the purposes of providing social and
recreational facilities of the club;
3. the replacement asset/s must be acquired
within 12 months from the date of disposal
of the first asset and brought into use within
three years from that date of disposal.
If a capital gain does not qualify for this roll-
over relief, it will be taxed at a rate of 14,5%.
It is emphasised that all the new tax rules
outlined in these articles apply only to clubs
that are approved by SARS as “recreational
clubs”.
Readers will no doubt agree that the new
tax rules for clubs are anything but simple. It is
hoped that SARS will release some guidance
soon to assist clubs with meeting their legal
obligations in terms of these new provisions.
Jackie assisted the CMASA in com-
piling and presenting their submission to
Parliament last year on the new tax legisla-
tion pertaining to recreational clubs and
has interacted closely with both the CMASA
and SARS over the last year as the new
amendments have been implemented.
Five things to do now
1. Identify the different types of income
earned by your club.
2. Analyse your club’s expenses between
direct expenses and overheads.
3. Work out a suitable method of allo-
cating overhead expenses to the
various types of income.
4. Identify which income will be exempt
from tax.
5. Prepare an estimate of your tax lia-
bility for the end of your next financial
year.
 Is your golf course exceptional,
exciting and enjoyable?
...it could be

PO Box 4531 Dainfern Valley 2055

Johannesburg, South Africa
Tel/Fax +27 11 469-3345
e-mail: COBIELEG@telkomsa.net
Direct personal service line
+27 83 375 2098

My team has over two decades of experience in golf course design and construction!
Cobie Legrange has won 23 international tournaments, including the Australian Masters and two British Masters titles.
Once ranked 15th in the world, he now applies a lifetime of knowledge and experience to: • Design of golf courses &
golf estates to international construction specifications • Redesign, reconstruction, and consultancy across the board,
including par-three golf courses, driving ranges, golf studios and academies, golf estate residential layouts and feasibility studies
• Liaising with top international golf stars for signature designs.

Is it ever fair
to discriminate?
You can discriminate but beware! Andrew Wilson of
GCM explains why.
It is almost impossible these days to avoid
discrimination as we are all brought up with
prejudices and belief systems that in turn
influence the way we view the world and the
people we come into contact with. Whatever
experiences have influenced our thinking with
regard to others, we can’t allow those beliefs to
manifest themselves in the work environment.
The law specifically identifies any unfair
act or omission that arises between an
employer and an employee, or prospective
employee, involving unfair discrimination,
whether directly or indirectly, against an
employee, as an unfair labour practice.
The law goes on to specify examples of
where employers are not allowed to show
favour, either for or against an employee.
The list includes but is not limited to race,
gender, sex, pregnancy, marital status, family
responsibility, ethnic or social origin, colour,
sexual orientation, age, disability, religion,
HIV status, conscience, belief, political
opinion, culture, language and birth.
Unfair discrimination can take on two
forms:
1. Direct discrimination
2. Indirect discrimination
Direct discrimination
This is easy to detect as an employer will
overtly favour a particular type of employee,
or prospective employee, to the detriment of
others.
Indirect discrimination
This is more difficult to identify. On the sur-
face, the policies of the company or club can
be neutral but the practices indicate that, in
reality, certain catagories of employee are
being discriminated against.
Taking all of the above into consideration
is it ever possible to discriminate fairly? In
the eyes of the law it certainly is. There are
four grounds on which discrimination could
be deemed to be fair. These are:
HR LEGAL
Affirmative action
The main aim of the Employment Equity
Act is to ensure that previously disadvan-
taged groups are fairly represented in the
workplace and to this end, employers can
favour designated groups (blacks, women
and disabled persons) when recruiting,
developing, promoting etc. If a person or
applicant from a designated group has the
capacity to satisfactorily fulfill a function
within a reasonable period of time, that
person or applicant should be given prefer-
ence over someone from a non-designated
group (white male).
Inherent job requirements
If a job requires certain skills for the work
to be performed then discrimination under
these circumstances would not be deemed to
be unfair. For example, a golf club recruiting
a head greenkeeper would be quite within
their rights to stipulate as minimum job
requirements that the successful applicant
should have certain relevant qualifications
as well as appropriate experience.
Requirements of law
Two examples are that you are not allowed
by law to employ children under the age of
15 years, nor are you allowed to employ
pregnant women four weeks before confine-
ment and six weeks after giving birth.
Productivity
Providing your criteria for assessment are
deemed to be fair, employers may discrimi-
nate on the basis of productivity and/or
results when considering merit increases
and bonuses.
The bottom line of all this is check your
thinking and beliefs before you open your
mouth, commit anything to writing or act!
For more information on Human
Resource matters contact Andrew Wilson on
082 575 3861 or at consultaew@iafrica.com
BIRDIES AND BOGEYS

See our club profile article

on Parys on page 11 of this
issue.
Mark Truter turned pro-
fessional in 1994 where
he initially worked out of
Kyalami Golf Club. He then
made the move to Kwa-Zulu Natal where
he spent eight years at Victoria Country
Club in Pietermartizburg. Through con-
tacts in the industry, Mark made the move
to Parys Golf and Country Estate where
L-R: Shawn Wewege, Ryan Goosen, David Carmichael, Koos Pansegrauw (Vice he has been since the opening of the
Chairman) and Dave Sherwood (Chariman) course in May this year. He is an avid fly
fisherman which played a major role in
Establishing standards through education helping his decision to move to the Vaal.
He is in heaven playing golf on the Vaal
The South African Turf Equipment Technicians Association or SATETA was established
and throwing a line out after hours – an
in January 2007 as an association for Technicians in the turf industry. On 22 November,
ideal place for any fishing enthusiasts.
SATETA was formally constituted and a committee put in place at a meeting held at Bryanston

The law is an A..

Country Club. The Association is closely affiliated with the GCMGA (Golf Course Managers
and Greenkeeper’s Association) and operates in the Gauteng Region.
SATETA offers a forum for the technical side of the turf industry, which will provide a
Two recent judgments are cause for major
training ground and knowledge base to its members. The membership is made up of turf
concern amongst golfers and golf clubs. In
technicians and trade representatives. Meetings will be held from January to November,
Gauteng a golfer was found liable for causing
usually on the last Wednesday of the month. As the focus is on education, motivation and
damage/injury when he hooked his ball out of
networking there will always be an educational or motivational presentation followed by
bounds. The judge found that he was prone to
a light lunch during which members will have the opportunity to discuss issues relevant to
“hooking” (in the golfing sense of the word)
their day to day activities.
and therefore should have made allowances
Club managers are urged to encourage their technicians to join SATETA in a bid to
for this when lining up his drive.
uplift the profession and improve standards within their work environment.
In the second case at Milnerton in the
For further information or sponsorship opportunities please contact Dave Sherwood on
Cape, a resident on the golf course com-
082 441 1654 or dave@golfdata.co.za.
plained that he and his house were in danger
from sliced drives. The appeal judge found

New CMASA executive committee in favour of the home owner, stating that the
hole “was badly designed”, and that the inci-
Bushman Sands, in Alicedale was the venue for the CMASA Executive Committee’s dents of wayward drives were excessive.
strategic planning retreat. This was an extremely positive and successful meeting, where Golfers and golf clubs will have to seri-
strategies with goals and timeframes for the next three years and beyond were agreed. The ously rethink their insurance strategies!
CMASA “ship” has a clearly plotted course and all readers will be advised of the strategies PS: Mind you, I suppose now I can always
in a future issue of GCM. blame the hole for being badly designed
when I either slice or hook the ball off the
tee; which I do frequently! – Ed.

CONGRATULATIONS
Congratulations go to General Manager
Christoph Leinberger and Director of Golf
John Bumpsteed at the Arabella Western
Cape Hotel & Spa which has been named
the Golf Resort of the Year for 2008 in the
Back Row L-R: Michael Edy, Peter Hanley, Dereck Hirson, Harry White, Paul Leishman, Rest of the World category at the annual
Herman Muller conference of the International Association
Front Row L-R: Beryl Acres, Sue Nortje, Bill Taylor of Golf Tour Operators (IAGTO) held
Absent: David Nicholas. recently in Cancun, Mexico.

22 February 2008 Golf Club Management


Raising standards in
the security industry
The security industry is raising the bar in terms of
standards. Jenny Reid, immediate past president of
the Security Association of South Africa (SASA),
explains.
The Security Association of South Africa
(SASA) is raising private security service
standards by several levels thanks to the
introduction of an entirely new Gold Class
membership aimed at radically improving
service delivery of members to their clients.
The SASA national committee considers
it essential that a new class of membership
be created which focuses on legislated com-
pliance within the South African security
industry. As a part of a new strategic plan
to keep abreast of changes and challenges,
security industry members of SASA now
have to enrole as Gold Class members.
Gold Membership aims to exert a posi-
tive influence on the entire security industry
by promoting the importance of legal com-
pliance. Even more important are warnings
about the risks and dangers of non-compli-
ance to both security service providers and
the end-user clients of security services.
Few prospective clients know that it is a
criminal offence to contract a security serv-
ices provider which does not comply with the
law. Pitfalls like that and others need to be
brought to the attention of clients. Only when
consumers insist on compliance and drive
home their demands will the entire security
industry be forced to become more profes-
sional and improve its public image.
Currently only a fraction of installers /
security professionals are SASA members.
Pressure by potential clients asking whether
a security provider is a member of SASA
would help to persuade that entity to become
a member.
SASA considers it essential for security
companies and consumers to self-regulate
the security industry and stop relying on
the Private Security Industry Regulation
Authority (PSIRA) to bring the non-com-
SECURITY
pliant and illegal security operators to book.
Essentially SASA’s new Gold Membership
aims at:
• Assuring end user clients that their security
services provider complies with the law;
• Protecting the clients against the Private
Security Industry Regulation Act of 2001,
known as the PSIRA Act, by assuring due
diligence and good corporate governance
is being applied;
• Protecting clients from possible severe
prosecution which could mean a stiff fine or
imprisonment of up to two years – or both.
To shoulder responsibilities like that, any
security company seeking the SASA Gold
Class certification would have to comply with
several stringent demands and issues which
will be audited and verified by SASA.
SASA will request compliance certificates
with proof of compliance annually. In return
Gold Class members will enjoy numerous
benefits and have major advantages over
non-compliant security outsiders. The new
thinking is that there should be a quantum
leap in the significance of SASA member-
ship. The SASA do not want to change what
they stand for but rather ensure that they
start delivering on more of the principles
they stand for. The basic auditing of their
members’ compliance with industry funda-
mentals will give relevance to the SASA
playing a meaningful role in professional-
izing the security industry.
Article byJenny Reid. Jenny is managing
director of GriffithsReid, and immediate
past president of The South African Security
Association. For more information on your
security requirements contact Jenny on 082
600 8225 or at jenny@griffithsonline.co.za
or check out their website
www.griffithsonline.co.za