Indoor Golf Sim Franchise - $60,000 in Passive Income?

[GolfSpy_SHARK]

1 minute ago, GolfSpy_TCG said:

I'm definitely on the 'gearhead' side of the equation. Also, the $45/hour is super expensive compared to the membership. You'd only have to go 26 times to make the 6-month membership worth it. 

Also, the Private Fairway setup only lets you book three hour long slots at a time. This is nice as you can book a three hour session if you want to have a little get together, or you can sneak in for an hour everyday like my neighbor does. He basically books a slot three days out right after his current session is done.

I don't know about you guys, but a one hour session is much easier for me to get away with when asking my wife if I can go swing the sticks vs. a minimum two-hour plus drive time 9 holes.

So the place locally offers a membership (believe its $100 bucks for the year) and it drops the hourly rate to I believe 36 so if you go 11x during the season it pays for itself. I usually go around 10x so its close to worth it for me. 

I like the 1 hour deal too, winter time I found myself going after work and was home by 4:30. Its the groups that still take 4 hours.

[thechrisgibbs]

1 minute ago, JonMUSC08 said:

I'll have to check that out! I've been dreaming of putting in a home simulator myself BUT at an 'affordable' budget price too. 

Yea i feel like the Mevo+ is the "poor man's trackman"? Maybe? Plus is can easily pick-up righties/lefties unlike skytrak. Of course this is my concern as a lefty haha.

So my SETUP has a spreadsheet on it with links to everything. I only chose Skytrak because I didn't have 8 feet behind and 8 feet in front although I love the Mevo+ platform. I do have a Mevo (not plus), and I love it. Also, you really don't have to spend the full $4K at once. I built it with a net and cheap hitting mat at first and just used a computer monitor I had lying around. You could do the Mevo+ software, hitting mat, and net to get started for $2,500. 

[russtopherb]

39 minutes ago, GolfSpy_TCG said:

What were the indoor sims like that didn't make it? Did they have employees and overhead? That's definitely higher risk if you have to maintain employees as your cost goes up drastically and your GM goes down respectively.

One sim was pretty much run by the owner and one other employee. The other had a small staff (maybe 4-5 people max) along with a liquor license so you could have a few cold ones while on the sim, or at their small bar afterwards.

[GolfSpy BOS]

The PGASS that opened up near us obviously has the size for many hitting bays... you can book them for $10 an hour (or something close to that).  They could easily priceout the smaller places since you can still actually play a course using their set up too.  

Of course you don't get the ambiance or group play that way, but the price pressure could still remain.  

[jddaigneault]

Every once in awhile my wife and I play the lotto. I’ve decided the perfect way to spend the winnings is to open a Top Golf and “go to work” everyday so my future kids don’t think I don’t work hard for money and end up entitled pricks. I live in SoCal, and we surprisingly don’t have one. Yet. 

It costs $18 million to start a location. Across all franchises, each location averages $25 million in revenue per year. I’ve no idea how much their operating costs are, but it still seems like a sound investment. People love top golf, and it’s nice 360 days a year in SoCal. It rains or is far to windy at least 5. It’s a burden. 

[GolfSpy BOS]

2 minutes ago, jddaigneault said:

Every once in awhile my wife and I play the lotto. I’ve decided the perfect way to spend the winnings is to open a Top Golf and “go to work” everyday so my future kids don’t think I don’t work hard for money and end up entitled pricks. I live in SoCal, and we surprisingly don’t have one. Yet. 

It costs $18 million to start a location. Across all franchises, each location averages $25 million in revenue per year. I’ve no idea how much their operating costs are, but it still seems like a sound investment. People love top golf, and it’s nice 360 days a year in SoCal. It rains or is far to windy at least 5. It’s a burden. 

$18 million sounds like an absurd amount to start a location.... Sounds like about $17m to use the name and that may be lowballing it!

Of course, if that includes purchasing the land and what not I can see some areas being higher.... I guess I see why they're not popping up closer to us in MA.  

[JonMUSC08]

1 hour ago, GolfSpy_TCG said:

I thought about something like a Mevo+ as you could build the entire setup like I did just with more of a hands-on building experience of the simulator. I did a pretty deep analysis of how to setup an 'affordable' ($4K) Home Setup. I used a Skytrak and The Golf Club in my home setup, but it's not near as simple to use as the Trackman setup. Also, the Skytrak doesn't pick up my Driver very well.

I'll have to check that out! I've been dreaming of putting in a home simulator myself BUT at an 'affordable' budget price too. 

Yea i feel like the Mevo+ is the "poor man's trackman"? Maybe? Plus is can easily pick-up righties/lefties unlike skytrak. Of course this is my concern as a lefty haha.

[JonMUSC08]

They just announced they Top Golf is planning a location around me in Charleston, SC. I can't wait! Have only been to 1 in Scottsdale, AZ and it was cool. 

[myherobobhope]

19 hours ago, GolfSpy_TCG said:

Anyone interested in $60,000 in passive income per year and living your golfing dreams? Not an ad, I promise; just hear me out!

So recently, my neighbor invited me to a place he has a 6-month subscription to called PrivateFairway. The owner has four locations right now with a few more in the works. As someone who has been to a handful of indoor simulator 'experiences' and countless fitting bays, something about this place stood out to me as different. 

So each location has one Trackman built simulator bay, an area for clubs, a bar top and mini-fridge with room for a BYOB vibe, AND the owner only allows 35 memberships at a time. He doesn't allow one-off sessions and starts at a minimum of 10, hour-long sessions at $250. Most of his members do the unlimited sessions, 6-month pass which is around $1200. He is sold out at all four locations and has a waitlist of 50 people for each location. Some quick math shows that each location is pulling in $84,000/year from the memberships, not including the 10 punch pass type users.

 

 THE MONEY LINE 

Out the gate, I did a quick analysis on how much each franchise makes in gross margin and startup costs for anyone interested in a passive income type option.

Let's start with startup cost (Estimated $58,490):

Right out of the Trackman simulator catalog which retails for $49,990 (+$3,500 for Utah sales tax).

I can't be sure around how much it cost him to remodel the interior, but with cheap new carpet and painting, I wouldn't guess he put more than $5,000 into the remodel if he put anything into it at all.

As you can see, it's a pretty cookie cutter designed space with a bar top, two barstools, and a mini fridge (not pictured). All-in, I bet you can get out the door for $2,500-$4,000 for this setup.

Building a well designed website like the one he has, I would assume $6,000 with a run rate of $1,000/year. We'll add the $6K to the estimated start up cost.

Now, onto the annual expense of running the place (Estimated $17,984):

The space: Around 1,000 square feet at $7/sq. ft./year which comes out to a space in an outlet space for $7,000/year. This is pretty low for strip mall areas around here, but I know he got that price if not better as I live nearby and you can look up a few of the other open spots in the strip mall. I'd put the actual cost at around $10-$20/sq. ft./year if you are looking at nice area retail spaces. We'll call it $14 for the sake of this cost analysis, so $14,000/year on average.

The Trackman Software and Hardware annual subscription costs $1,334/year with a 3-year subscription. 

Annual Cost of Running a Website: $1000/year.

Based on my own electric bills for cooling and heating less than a mile from the space, he likely pays $1,200/year to keep it at 74 degrees.

Business insurance for that retail space probably runs under $450/year. 

 

Now I know there are likely plenty of things I missed, but the beauty of this space is that he doesn't have to pay for marketing at all. In fact, when he opened up his fourth location in Sandy, Utah, he posted the news on his Facebook and filled his 35 memberships in two days. Two days to get up and running at full capacity. He limits users to booking out three sessions in advance. You pay your subscription upfront. You can bring as many people for your hour session to play as you want. And the best part, he has ZERO employees. All members get a key fob and go in when they book their sessions. When the new person gets there, the other logs out at the hour. It's mostly all on an honor system. He has a few cameras that you can find online that allow free cloud recording in case anything gets damaged, but just as golf is a gentleman's game, the honor system seems to be working VERY well.

So all in, you need the startup costs of around $60,000 (Although Trackman has financing options), and your annual fees will probably be around $18K. With that said, just the memberships of 35 people will bring in around $84K/year with a waitlist to boot. This is a pretty incredible look at a franchise with great passive income potential. After the first year, you'd be looking at close to $60,000 in passive income with extremely minimal effort post launch.

Sounds good to me. Would love to hear your thoughts on this guy's business model.

I think its a great idea, especially as retail space becomes available and inexpensive… definitely would require the right location… high density areas where golf isn’t a year round activity…

There is definitely already some competition in this space, Louisville has at least one option, plus the majority of country clubs have added their own simulators.

The simple, no frills model looks good, but I imagine people will start building top golf type locations with food and beverage on top of golf… I’ve heard wonderful things about the world of simulated golf in Korea, and think there is probably a ton of potential to bring similar ideas here.

[jddaigneault]

1 hour ago, B.Boston said:

$18 million sounds like an absurd amount to start a location.... Sounds like about $17m to use the name and that may be lowballing it!

Of course, if that includes purchasing the land and what not I can see some areas being higher.... I guess I see why they're not popping up closer to us in MA.  

I believe there is a top golf suite in Boston. I’d guess the reason they aren’t there is more snow related. 

[GolfSpy BOS]

5 minutes ago, jddaigneault said:

I believe there is a top golf suite in Boston. I’d guess the reason they aren’t there is more snow related. 

There is a “Top Golf” over at Patriot Place, but it’s just simulators.  It’s not the same experience as the normal “Top Golf” more or less just using the name.  

[jddaigneault]

38 minutes ago, B.Boston said:

There is a “Top Golf” over at Patriot Place, but it’s just simulators.  It’s not the same experience as the normal “Top Golf” more or less just using the name.  

I know there’s a top golf suite at Foxwoods. It’s basically just an indoor simulator with all the bar and food options. 

[thechrisgibbs]

2 hours ago, jddaigneault said:

Every once in awhile my wife and I play the lotto. I’ve decided the perfect way to spend the winnings is to open a Top Golf and “go to work” everyday so my future kids don’t think I don’t work hard for money and end up entitled pricks. I live in SoCal, and we surprisingly don’t have one. Yet. 

It costs $18 million to start a location. Across all franchises, each location averages $25 million in revenue per year. I’ve no idea how much their operating costs are, but it still seems like a sound investment. People love top golf, and it’s nice 360 days a year in SoCal. It rains or is far to windy at least 5. It’s a burden. 

So I actually love going to Top Golf, but it’s not at all replacing or in my mind competing with this place.

For one, Top Golf uses dummy balls that include their RFID chips in them. I think the ball speed maxes out at like 165, but the data from the launch monitor shows they have low speeds on longer clubs. I go to top golf to drink and hang with friends. It’s incredible for that!

I lived in SoCal for 15 years and it blows my mind there isn’t a top golf. There is still a ton of land in Orange County, LA, the inland empire, and San Diego. I guess they’re concerned about competing with real golf courses which there aren’t enough of, and other outdoor activities.. 

Top Golf does a great job in snowy conditions with massive radiant heaters too. 

 

[jddaigneault]

17 minutes ago, GolfSpy_TCG said:

So I actually love going to Top Golf, but it’s not at all replacing or in my mind competing with this place.

For one, Top Golf uses dummy balls that include their RFID chips in them. I think the ball speed maxes out at like 165, but the data from the launch monitor shows they have low speeds on longer clubs. I go to top golf to drink and hang with friends. It’s incredible for that!

I lived in SoCal for 15 years and it blows my mind there isn’t a top golf. There is still a ton of land in Orange County, LA, the inland empire, and San Diego. I guess they’re concerned about competing with real golf courses which there aren’t enough of, and other outdoor activities.. 

Top Golf does a great job in snowy conditions with massive radiant heaters too. 

 

I haven’t won the lotto yet, hence the lack of a top golf. 

[vandyland]

51 minutes ago, GolfSpy_TCG said:

So I actually love going to Top Golf, but it’s not at all replacing or in my mind competing with this place.

For one, Top Golf uses dummy balls that include their RFID chips in them. I think the ball speed maxes out at like 165, but the data from the launch monitor shows they have low speeds on longer clubs. I go to top golf to drink and hang with friends. It’s incredible for that!

I lived in SoCal for 15 years and it blows my mind there isn’t a top golf. There is still a ton of land in Orange County, LA, the inland empire, and San Diego. I guess they’re concerned about competing with real golf courses which there aren’t enough of, and other outdoor activities.. 

Top Golf does a great job in snowy conditions with massive radiant heaters too. 

 

Was just coming to say this. I actually prefer a regular range to Top Golf. The numbers are pretty far off, the atmosphere kind of sucks (to me) with drunk people shanking balls left and right. 

Nashville has one coming this year, supposedly, with 6 bays. That's a sizeable investment...

 

[golfish!]

9 hours ago, jddaigneault said:

I haven’t won the lotto yet, hence the lack of a top golf. 

BTW they are opening a Top Golf in LA and one in Ontario sometime next year. They were supposed to be open by now but the pandemic halted everything.

[toehold57]

Alright, which one of you spies took this idea and ran with it?

https://www.sticksgolfrange.com in Mt Pleasant, SC?

[Hobert]

I actually reached out to X-Golf earlier this year to learn more about their franchising opportunities. They were behind with current franchises being delayed some due to the Pandemic and suggested I reach out again towards the end of this year. I plan to do so.

[toehold57]

1 hour ago, Hobert said:

I actually reached out to X-Golf earlier this year to learn more about their franchising opportunities. They were behind with current franchises being delayed some due to the Pandemic and suggested I reach out again towards the end of this year. I plan to do so.

X-Golf, I had not heard about them.  Looks like an upscale package.  Hope you get some good news from them.

[JFish350]

I reached out to X Golf last year and still haven't heard from them. We are looking at other sims and plans. 

[dlow206]

I am now considering this, especially since the Bushnell Launch Pro came out. 

[BMart519]

On 12/4/2021 at 3:49 PM, dlow206 said:

I am now considering this, especially since the Bushnell Launch Pro came out. 

An overhead system is far easier to manage, followed by radar behind the hitting area. Side on camera systems are great for accuracy and reducing indoor space. But switching for lefties is a pain and you wouldn't want a sim being moved back and forth 100X per hour when you have mixed groups. The uneekor systems are similar in price to the GC3 or Launch Pro by the time you add a subscription. 

[dlow206]

10 minutes ago, BMart519 said:

An overhead system is far easier to manage, followed by radar behind the hitting area. Side on camera systems are great for accuracy and reducing indoor space. But switching for lefties is a pain and you wouldn't want a sim being moved back and forth 100X per hour when you have mixed groups. The uneekor systems are similar in price to the GC3 or Launch Pro by the time you add a subscription. 

Good thought on the lefties. I always forgot that there are left handed people in this world 

[MNUte]

On 7/7/2021 at 2:34 PM, GolfSpy_TCG said:

Top Golf does a great job in snowy conditions with massive radiant heaters too. 

 

Yep. The only time I've had a bad Top Golf experience in the winter was New Years Eve a few years ago when we had a -20 wind blowing right into our faces. I think the real feel was well below 0. Apart from that, the heaters are absolutely perfect. And Top Golf is a great time for players of all skill to just get together, drink, eat and have a blast. 

[ballplayer002003]

So this is an interesting topic and I am definitely intrigued.  I am retiring in five years and need another source of income, something in the golf world preferably.  With this concept of no employees and open 24 hours, how do you all plan on explaining how to operate the system to get it up and running for each group?  I also saw where members can invite guests, what is to stop me being a member and giving my buddy the door code when ever he wants it?  Lastly, if it is a BYOB, who is liable if someone leaves this facility and causes an accident?  Just a few preliminary questions.  

[Tom the Golf Nut]

1 hour ago, ballplayer002003 said:

So this is an interesting topic and I am definitely intrigued.  I am retiring in five years and need another source of income, something in the golf world preferably.  With this concept of no employees and open 24 hours, how do you all plan on explaining how to operate the system to get it up and running for each group?  I also saw where members can invite guests, what is to stop me being a member and giving my buddy the door code when ever he wants it?  Lastly, if it is a BYOB, who is liable if someone leaves this facility and causes an accident?  Just a few preliminary questions.  

I was looking into this a little as well. No intent on doing it but interested in the concept. There are three different methods of learning to use the system.

1) You have to attend an orientation

2) on your membership website there are instructions

3) laminated instructions on the wall.

You usually can typically only reserve 3 hours a week and you have to use the reservation system. You have a member access code when logging in as well. If you can only book 3 hours a week and you give you info to your buddy and he goes then there wouldn't be much time left for you so I would assume he wouldn't be your buddy very long! Most places install cameras for keeping an eye on things, theft, destruction or reservation issues. I assume they could also use this to see that the member is using the system with a guest.

The drinking issue probably isn't an issue as the facility did not sell or distribute the alcohol. It is like someone going to a golf course with a few six packs stowed in the cart. The course didn't sell it to you and they aren't responsible. Once you left the course and something happened it's on them. But I would check with someone in law enforcement to verify.  

 

[GolfSimGuy]

Does anyone know what is considered a membership?  I've noticed that 35 members per location is mentioned a lot and not sure if "membership" is referring to 3/6/12 month membership or if the 10/20 sessions pass are considered "memberships"

Issue I could see is 35 people buy 10 sessions @ $250.  Which according to site, the 10 sessions expire in 6 months.

35 people x $250 = $8,750

I realize I'm missing something but not sure what

(Also, what would the draw backs on 1 yr expiration vs 6 months)

[palvord]

I think that the critical piece here of why this is so attractive for potential client's is you get the simulator to yourself or your group when you are there and the 24hr access. Just like 24hr fitness centers have created a niche alongside the behemoth fitness centers, a place like this would appeal to clients who work varying hours or want the feeling of privacy to work on their game.

The one bay model for sure limits overhead, but also allows a client to get that "at home" feel where you are less worried about observers. You are free to work on whatever you need to in your game or your group can socialize without being concerned about bugging other patrons.

There are a few indoor simulators in my area, but most seem to be trying to appeal to the crowd that wants to socialize and happen to be doing something other than being at a bar. Here in Michigan, this would appeal to the crowd that goes to the driving range in the winter under the heated bays.

[CraigPrivateFairway]

Hey Chris - Not sure why it took me so long to come across your post.  I am the creator of Private Fairway.  We have now grown 7 locations in Utah and just made all the arrangements to franchise Private Fairway in most states across the US.  We are currently in discussions with a number of potential franchisees.  Your analysis is close.  A few things are a bit off but overall we have experienced great success with the concept.   We have learned a lot in the process of opening and managing our locations. 

If any one is interested in the franchise they can find out more and request more info at privatefairwayfranchise.com or they can reach out to me.

[Clayton]

On 4/11/2022 at 7:27 PM, CraigPrivateFairway said:

Hey Chris - Not sure why it took me so long to come across your post.  I am the creator of Private Fairway.  We have now grown 7 locations in Utah and just made all the arrangements to franchise Private Fairway in most states across the US.  We are currently in discussions with a number of potential franchisees.  Your analysis is close.  A few things are a bit off but overall we have experienced great success with the concept.   We have learned a lot in the process of opening and managing our locations. 

If any one is interested in the franchise they can find out more and request more info at privatefairwayfranchise.com or they can reach out to me.

I am curious how it's working with the Trackmen you have.  I worked this winter at a Trackman simulator and people were always messing with the unit or fiddling with the software.  Not completely sure, but the Uneekor Eye XO seems like a better unit for "the masses" and not having employees at the location (ours is also a no-employee type but in Norway, not the US).  I am interested in doing something like this, or perhaps with you guys, when I move back to the US soon.