Eddie Reid: GolfBusinessNews Interview
Story published at 14:44, Friday, August 21st, 2015
Page last updated at 4:30 pm, Friday, August 21st, 2015
GolfBusinessNews.com speaks to Eddie Reid, Managing Director of golf retail services group the TGI Golf Partnership about the company’s performance and the golf industry as a whole.
How have the past 12 months been for you?
The past year, like the 15 before it, has been another year of growth for the group in both terms of Partner numbers and profits.
In terms of financial performance we have seen not just TGI Golf Partners, but also the on-course sector as a whole outperforming our off-course competitors, which shows a general trend that the consumer is returning to the on-course retailer. That can only be good for the golf industry.
This continued growth also has tremendous benefits for all of our PGA Professional Partners who receive money back every year through our profit share distribution, which has seen us pay more than £2 million back to our Partners over the last 15 years.
In general terms it’s worth noting that the on-course market share has grown even though the overall market has been flat.
In 2014 we saw, on average, one PGA Professional per week join the TGI Golf Partnership, and this trend has continued through the first half of 2015.
What do you think has instigated that growth in Partner numbers?
I think much of it is down to the quality of the work we do, but also the fact that high quality PGA Professionals are realising the wide range of benefits available to them by being a Partner of something exciting and successful.
Over the years we have pulled together an excellent team of experts in their field, whether it’s retail, marketing, PR, finance or admin we have everything covered. What’s more, everyone who works for TGI Golf believes in what we want to achieve and is pulling together to help our Partners achieve their goals.
We do not impose anything on our Partners, they remain in complete control of their businesses, we are simply there to offer guidance, support and for them to lean on our experience. They can use us as much or as little as they like.
What makes TGI Golf different to other buying groups?
We no longer see ourselves as a buying group. Yes, our Partner Suppliers are contractually obliged to offer our Partners the best UK and Ireland terms, but that is just a fraction of what we do to assist our Partners.
We see ourselves as a retail services group, assisting PGA Professionals to run successful and profitable businesses.
While every group out there has some excellent initiatives and offers tremendous support to the on course retailer I think the main difference between us and our peers is the way our business is structured.
All our Partners pay a joining fee, which includes a block of shares in the company to become a full Partner. We realise this may be intimidating for those PGA Pros just setting up a business, but there are payment plans in place to help budget for that cost.
However, once they have paid the fees and are a full Partner they will not pay another penny – no annual fees. No subscriptions.
So, if you are with us for 30 years, you’ll still only have paid that initial fee. What’s more, there is no single person with more shares than anyone else – every Partner is an equal shareholder.
At the end of each financial year those shareholders, as with all businesses, receive a profit share.
Our business is all about the PGA Professionals’ business – we are not interested in taking money out of their business, all we want to do is put money in. It is a shared commitment from everyone involved in the group, we put a lot into it on our Partners’ behalf, safe in the knowledge that they will benefit as will the company and Partner Suppliers in the long term.
Where do you see the on-course retail industry at the moment?
The golf industry is in a very strong position at the moment, despite the gloom that still rears its ugly head in some quarters.
We have seen for the last 18 months that the on-course retailer is fairing far better than their off-course competitors, while many brands are now recognising the longevity of the on-course market.
Many of the major brands are beginning to change their go to market strategy, in recognition of the challenges facing the green grass Pro.
Why do you think the on course retailers are out performing their off course counterparts?
One of the main reasons I believe the PGA Professional is buoyant at the moment is because those forward thinking pros who have embraced custom fitting and technology are giving the consumer a real experience when they come into the Pro Shop.
Club fitting, putter fitting, ball fitting and the technology involved in all of these services is something that is turning the golf consumer on.
Unlike at the start of the recession the golf clubs are now seeing good PGA Professionals for what they are – an asset. Rather than trying to cut their retainers or get rid of them altogether, forward-thinking clubs are looking to involve them and their expertise in the day-to-day running of the facility.
So you think the on course retailers are in a far stronger position than they think?
Absolutely. There is so much for the on-course retailer to be excited about right now.
The last 18 months have been extremely good for golf – a hugely successful Ryder Cup, young guns like Jordan Spieth and Rory McIlroy flying high, more youngsters coming into the game and more and more customers walking through the doors of our Pro Shops.
As previously mentioned, latest figures show that the on-course golf market is outperforming its off-course competition, more brands are recognising the value in working with green grass retailers and the market is less volatile.
There is so much going for PGA Professionals at the moment – I firmly believe that good quality pros will always survive.
Eddie Reid, thank you very much
TGI Golf Partnership www.tgigolf.com