Special Report: Facility Management

Whether large or small, public or private, tennis facility owners and managers face many common challenges.

Additional reporting by Peter Francesconi

This is the fourth in a series of articles about the tennis industry’s changing landscape. Future topics will deal with participation, court construction, pro tennis and more. We’d like to hear your comments and concerns too. E-mail them to info@tennisindustrymag.com. Please put “state of the industry” in the subject line. To view past “State of the Industry” stories, visit tennisindustrymag.com.

In terms of tennis facilities, there are no terms — or at least none that seem to apply in every situation. Across the U.S., facilities vary widely in player demographics, staff size and budget. They may be public or municipal, commercial or private, with courts that are hard or soft (or both), indoor or outdoor, bare bones or well-appointed and receiving extensive daily maintenance. They may be tennis-only, or they may be part of larger complexes that include everything from exercise rooms to golf to squash to swimming pools to day spas.

Just about the only common denominator is that in tennis facilities, managers and owners have multiple responsibilities. The same person who is on the court giving a lesson at 2 p.m. may be cloistered in his or her office by 4 p.m., sweating over a balance sheet and keeping one eye on the clock because at 5 p.m., a potential teaching pro is going to present herself for a job interview. For them, the state of the industry is all about being ready for the next challenge, and their days are full of those.

This constant need to diversify, says Dan Santorum, executive director of the Professional Tennis Registry, has resulted in club owners and managers becoming almost a breed unto themselves. They are isolated, despite having constant interactions with staff, players and their board of directors. It leads to inertia, to frustration and sometimes, to burnout. IHRSA (the International Health, Racquet and Sportsclub Association), he adds, has shifted its focus from strictly racquet sports to fitness facilities in general, and the USTA has been emphasizing community tennis.

‘The Conflict No One Wants to Talk About’

Among many facility owners and managers, there are varying degrees of unease and resentment toward the USTA.

“Most club owners and managers feel a little bit disenfranchised by the USTA,” says Santorum. “Their complaint is that the USTA’s main focus is on the public sector, people playing in the parks, and that less attention is being paid to clubs. The volume of tennis is in the clubs, but most of the people play in public parks. It’s important to reach the masses, but the majority of frequent players and teaching pros are going to be in the clubs.”

Rod Heckelman, general manager and tennis pro at the Mount Tam Racquet Club in Marin County, Calif., calls the friction with the USTA “the conflict no one wants to talk about,” since it touches on sensitive issues on both sides. And while statistics touting the growth of beginner players are good news, facility owners and managers have ongoing worries.

“From the standpoint of the clubs and tennis players, the numbers being up are great: good news and increased income,” Heckelman notes. “The competition being down impacts the USTA directly; in fact, competition is their main source of income, especially adult leagues. For clubs, it is the reverse: We need more participation and less competition, more recreational tennis and more activities, less league play that steers players away from needing a club. This puts the USTA at odds with the club industry.”

The USTA is aware of the complaints, says Kurt Kamperman, the USTA’s chief executive of Community Tennis. Kamperman, who recently spoke at the PTR’s second annual Tennis Club Owners and Facility Managers Conference, also was able to listen to the questions and concerns of participants, and to address some of the issues.

“A lot of things came up informally at the conference,” says Kamperman, “about clubs and the USTA and the different priorities each has. For instance with league tennis, club owners were saying it doesn’t really make them money so it wasn’t a big priority for them.” Still, he notes, “I know a lot of commercial clubs where league tennis is their huge driver. There are some clubs that are clinging to the contract court time, but that’s a model that is changing.”

He fully acknowledges the USTA’s recent focus on the public sector, but says it is a strategy that should ultimately work in the favor of private and commercial facilities, since, “If you’re having a booming tennis section at the parks, it shouldn’t be a distraction; it should act as a feeder system.”

The focus on public tennis was well under way when the recession hit. But in at least one way, Kamperman adds, the downturn in the economy may have unexpectedly contributed to getting some more of those new players onto courts, since park and school programs are available free or for a low cost — something that would appeal to anyone affected by job loss or other setbacks. As the economy improves, those new players will seek better facilities, more enhanced learning opportunities and more competition, and will begin joining clubs.

“Now the focus is on growing a stronger frequent-player base,” he says. “That’s next: Let’s now do whatever we can to create that base. I think that bodes well for clubs.”

Survey Says …

In a survey conducted by the Tennis Industry Association in the fourth quarter of 2009, 76 percent of facility owners and managers reported that their outlook for the industry was “good” or “very good,” a 7 percent increase since 2005. In addition, they noted, the average number of participants in introductory or beginner programs was up 16 percent since 2005 and 50 percent since 2007, and that the retention rate for those new players had remained high.

But there are worrisome signs too. Average all-inclusive dues are 25 percent lower now than they were in 2005 as more facilities struggle to compete with not only other fitness programs and opportunities, but against an economy that has many families and individuals cutting back on discretionary spending. Among those facilities indicating their court usage was down, most blamed membership shortfalls, with less league play and lowered demand for group lessons and clinics (two things normally counted on as the big money-makers) also being cited.

According to Doug Cash, a business consultant with CashFlow Tennis, the drop-off can be attributed to two types of cutbacks on the part of players. “Probably the peak year for membership was 2007,” he notes, “and then there was a reaction to the economy. People who belonged to a club and who were low users downgraded; that is, they went to a less expensive membership, and those who weren’t using the club as much dropped their membership. As a result, there was an increase in attrition rates at that point. Normal attrition is 20 percent, and it probably jumped to 30 percent during 2008-2009, which also included the number of downgrades.

“As 2010 hits, the attrition rate has become better,” Cash adds. “There aren’t as many fringe people, meaning the people who are there are really into tennis. Clubs are growing their membership again. New membership sales are about 70 percent of what they were in 2007.”

Even at a time when statistics say tennis has never been stronger, managers remain concerned about the economy and are trying to be as conservative as possible in their own spending. Only 20 percent of facilities planned for capital improvements in 2009; less than half of those improvements will be made to tennis courts, while the remaining percentages include equipment, interior building, exterior building and landscaping (in descending amount of funding allocated).

Facility managers and owners want to capitalize on the growth of tennis and translate it into a better bottom line for their organization. But unlike the retailers and the manufacturers who want to capture the business of the frequent tennis players, many facility managers are concerned about the next generation of frequent players. They want to know, where are the kids?

“The key to any successful tennis club is the tennis-playing family,” says Hunter Gallaway of the Lafayette Tennis Club in Lafayette, Calif. “That’s who we’re catering to. You’re always looking to bring new blood in, and we want to keep growing our other programs, including our super seniors, but the family is the market we’re trying to bring in.”

The problem, say managers, is that families have changed. More children have scheduled activities during what used to be free time, and children who once would be enrolled in tennis lessons are going into other sports such as soccer or basketball. Juniors who play at the high school level are often seduced by lacrosse, which plays in the fall and spring, and are choosing that over tennis. And, managers add, parents seem to be driving their children into popular sports in the hope of excelling and scoring a college scholarship, rather than finding a sport that is enjoyable and healthy.

“When it comes to kids who could be playing as juniors, I think other activities are the main competition,” says Allison McLendon, retail manager at Bentwater Country Club in Montgomery, Texas. “We have a lot of kids who tell me, ‘I have gymnastics on Monday, soccer on Tuesday and tennis on Wednesday.’“

“Tennis and the whole country-club lifestyle has changed because families are putting their kids into other sports,” says George Kustas of the Poughkeepsie Tennis Club in Poughkeepsie, N.Y. “They’re not only putting these kids into these sports, but they’re putting them in full force. They join travel teams and they play all year round. They’re on the field from Saturday morning to Sunday afternoon. The family isn’t going to the club and hanging around the pool. And the kids aren’t picking up their racquets and heading down to the park to play tennis with their friends on the public courts. They see the court from the minivan as they drive by on their way to soccer practice, but that’s it.”

Members Only?

As the economy has tightened, facility managers have become more creative in the options they offer potential members — and the ways they get them in the door.

“People have several options here,” says Dr. Sophie Woorons-Johnston of Performance Meadows at Brookstone Tennis in Anderson, N.C. “Our initiation fee is very low, but having it prevents people from coming in and out. We also have a beginner discount right now so that people can join without paying initiation fees. For returning players, people who were members but who left for a while, we will also waive the initiation fee one time.”

Some facilities offer reduced dues or a “price-match” with dues advertised at nearby facilities. Other incentives include the first month (or first several months) free, discounts to friends who join at the same time, and free months to members who refer new members.

At the same time, some organizations are finding ways to get individuals in the door by using a seasonal aspect of the facility, such as just the pool in the summer months. Many of these people can be persuaded to trade up once cool weather hits, they add, particularly if they’re given a taste of the other amenities. Greg Moran, director of tennis at the Four Seasons Racquet Club in Wilton, Conn., gives individuals with pool-only memberships an invitation to a free tennis clinic. “Once we get them on the tennis courts, we’re confident we can hook them,” he notes.

“I think tennis is a try and buy sport,” says Cash, “which means you have to get people in the door of your club. You can give people a trial membership whether they’re beginner or advanced. If they like it, they’ll get involved. I don’t know if more people are trying that, but more people should be.”

According to the TIA’s survey, a decreasing number of clubs is offering “tennis-only” memberships. In 2005, 57 percent of all facilities offered dedicated tennis privileges, as compared to 50 percent in 2007 and 46 percent in 2009. The average dues for tennis-only memberships has also dropped 15 percent since 2005.

“The best thing we’ve done is make things more inclusive,” says Sean McQuillan, director of tennis at Norton Pines in Spring Lake, Mich. He notes that by creating a program in which players try two organized activities offered at the club, they receive enrollment in a third activity free.

“We put the incentives out there for people to play more often and try more things,” McQuillan adds. “We didn’t have a lot of competitive juniors playing, so we started a challenge ladder. If you win, you get a racquet, if you come in second, you get a bag. Now, we have juniors playing again.”

Keeping Players in the Fold

Member retention is another concern for facility owners and managers. Keeping a member happy is easier than spending the money and energy to find a new one. And at a time when there are multiple options for exercise (including walking or running, which are free), keeping players in the fold takes more work than it used to.

Owners and managers agree that it is essential to get new players involved immediately, and to make them feel welcome. Woorons-Johnston stresses upon her staff the need to foster a family atmosphere in the club, and to make sure new members do not feel that a cliquish atmosphere exists.

“The most important thing you can do to keep the person in the club is to get them into a group of peers and friends,” says Freddy Goodman, director of tennis at the Club at Rawls Creek in Irmo, S.C. “Whenever we get a new member, we try to get them on league teams. They need to be in a social group and you need them to participate. If we don’t get them involved, if we don’t get them to come to the mixers, they don’t stay around. I found that out a long time ago.”

According to Michael Mahoney, general manager of Midtown Tennis Club in Chicago, participation is the key to retention efforts.

“Upon joining the club, our objective is to get a new member involved in club activities by introducing them to group programming with an emphasis on introducing them to other members at the same playing level and with similar availability,” says Mahoney. “We invite new members to participate in special events such as mixers, match play nights, and drop-in format programs such as Matinee Tennis, Early Bird Tennis and Cardio Tennis. New members receive a dozen coupons either discounting the fee or offering the activity free altogether for trial participation.”

At the Surprise Tennis and Racquet Complex in Surprise, Ariz., director John Austin has implemented the “Tennis University” learning program. “The concept is that we’ll have you playing on a 2.5 league by the time we’re done,” he says. “We don’t want lesson-takers, we want players.”

Who’s Minding the Store?

One point of discussion among facility owners and managers is the need for a pro shop — or, to be more accurate, the lack of need for one. While there are a few facilities that still have flourishing shops, most owners and managers we surveyed say that keeping a fully stocked (and fully staffed) store is no longer a profitable
venture.

“We have two pro shops, one at our athletic club over the tennis courts and one at our golf course,” says Rob Goldman, chief operating officer of the Columbia Association in Columbia, Md. “But we’ve pretty much come to the conclusion that with the major e-commerce opportunities out there for people, we should just stick with providing necessity items. We’ve been trying to reduce our inventory. We still carry some racquets, and the pros can still sell racquets, but we don’t sell shoes or clothing at all any longer.”

Racquet stringing remains profitable for many clubs. The TIA survey found that in a typical month during 2009, the average facility expected to sell 10 racquets, but to restring 30. Grips and balls are always in demand, say managers, and some facilities stock clothing with their logo on it, but very few keep tennis skirts, tops or dresses in stock.

“Really, with clothing, the only time we did well was when it was on sale,” says Goodman of the Club at Rawls Creek. “I had to discontinue it.”

More and more facilities report having their front desk personnel handle the sale of merchandise, and pros taking orders for restringing. The rise of online court reservation systems, say owners and managers, has freed up those individuals to perform more in-person customer-service functions and allowed court bookings to operate more efficiently.

Ray Major, tennis director of the Fretz Tennis Center in Dallas, is an enthusiastic proponent of technology in tennis. Upon arriving at Fretz a little less than a decade ago, Major found himself faced with a system “where everything was done on paper and there was an old-fashioned cash register.” Major wasted no time in taking the program online. Today, he uses TennisConnect, which he says “streamlines everything and makes it a lot easier.”

The ability of players to log in, make court reservations, and sign up for leagues and lessons on their own time is a benefit to facilities as well as a convenience to players. “It significantly reduces costs and manpower, and it allows me to go out and clean courts, knowing that I don’t have to be there in case someone wants to book a lesson,” says Tim Jachymowski, owner of the Spring Lake Park, Minn.-based PublicIndoorTennis.com. “I get court reservations that come in at midnight, 1 a.m., and people have used their credit card, so it’s all paid for. If that person doesn’t show up, I already have my money.”

Net Game

While all facilities interviewed had websites, the complexity and amount of use varied widely. Some were strictly informational, listing only the basics: facility features, operating hours, address, directions and so forth, while others were more interactive, including links to online court reservation systems and the ability to sign up for notification of future events.

According to the TIA, 53 percent more of the facilities that have a tennis-specific website now have their programming listed on their website as well. A total of 27 percent use online registration, and 35 percent indicated an interest in offering online registration directly from program listings on the Tennis Welcome Center website or the Cardio Tennis website. (Cardio Tennis programming was popular in 2009, offered by 61 percent of all respondents, and outpacing even the popularity of swimming pools, fitness centers and group exercise classes.)

Communication with players and members has gone electronic as well: E-mail is the preferred method of notification of new programs, upcoming events and breaking news on rainouts or cancellations. Very few facilities still use a printed newsletter as their primary means of communication. Jachymowski says that he, like most, has an e-mail list, and “we do quite a few mass e-mails, but we’re careful not to get to the point of overwhelming people.”

And the TIA, says Executive Director Jolyn de Boer, has long been a proponent of using technology to increase business for clubs and facilities. “The TIA’s TennisConnect has recently come out with modifications that make it even easier for facilities to use just the features they need,” she says. “Our websites, including GrowingTennis.com, include easy links for facilities to post their programs and information for free into a national database searchable by consumers everywhere.”

Some facility owners and managers have ventured into social media. Mahoney reports that Midtown is on Facebook and has nearly 1,000 fans. Through Facebook, he adds, Midtown “can promote club events and social connections between members, such as arranging a game. A subscriber can also watch Midtown-specific video clips.”

The Bottom Line

While no club owner or manager likes the actual work of it, keeping a balanced budget is key to long-term success. Statistics that show tennis participation is on the uptick aren’t much help if you’re running in the red. The TIA survey found that the annual profit/loss ratio was down 50 percent since 2005. Owners and managers are turning to creative ways to cut costs, and are meeting with varying levels of success.

When the Columbia Association announced that it would be discontinuing the free towel service at its three health clubs, members’ complaints forced them to reverse the decision, according to Rob Goldman. But when members at the Courtside Athletic Club in Greenville, S.C., were given the choice of losing the towels or taking a dues increase, says Randy Bailey, the director of tennis, “They said get rid of the towels. It wasn’t really a big deal to them.”

When budget cuts at the Dunes West Golf & River Club in Mount Pleasant, S.C., resulted in having fewer staff available to care for the facility’s three soft courts, management instituted a do-it-yourself policy among members, requiring players to drag the courts after playing. “We got a little resistance in the beginning,” says Jack Miller, director of tennis. “But once people saw how well the courts were playing, they were fine with it.”

“The key to keeping members is always their perception,” says Cash. “The perception of, ‘Am I getting enough value for what I’m paying?’ People have started looking at every dollar they are paying, so you have to be careful when you’re cutting.”

Overall, the bottom line is at the top of everyone’s list of concerns, forcing managers to get, in their words, “lean and mean.” Phil Feidelseit of Brattleboro Racquet Sports in Brattleboro, Vt., reports that his operation and two affiliated clubs employ a core group of volunteers to help do maintenance and open courts for the year. Virtually all facilities have slashed their marketing and advertising budgets, doing most of their external promotions through e-mail and word of mouth.

Range of Cost-Savings Measures

Cost-saving measures employed by facility owners and managers ranged from barely noticeable to drastic. Conservative measures included using energy-efficient light fixtures, having court lights on timers and going with less expensive soap or paper towels. More severe cutbacks involved the elimination of full-time positions and increased reliance on part-time help. Cutting staff hours, while always an unpopular decision, was unavoidable in many cases. The TIA survey found that in comparing wages and independent contractors in 2009 to wages in previous survey periods, wages consistently accounted for approximately 40 percent of tennis-related business expenses.

At Norton Pines, McQuillan was one of those who made the choice to go with less expensive help. “It’s changed my staff a little, but for the better, I think. I have some pros who are young, right out of college. They’re really hungry to work, and they’re always recruiting more private lessons.”

Private clubs are not the only ones feeling the economic pinch. According to Austin, municipal facilities like his are no different. “Our city is having its problems like all cities are. We’ve reduced our part-time staff. The squeeze is on and we’re watching every nickel.”

“You really worry when you have a facility,” says Gallaway at Lafayette Tennis Club. “You do worry about that one major disaster — a roof collapse, things like that — but mostly you worry that the little things will start piling up at once: You need a new pool pump, you need two new windscreens, you need a new bench, your lights need to be replaced, and all of a sudden it’s $25,000 later. That kind of thing can put a small club out of business. You have to plan for things to go wrong. You have to stay current on maintaining equipment.”

Virgil Christian, USTA’s director of community tennis development, says that his organization’s message to pay attention to detail at the beginning of a project can pay dividends in the future. Unfortunately, he adds, people don’t always listen.

“We advise people to build it right, and to get a professional involved, too. Don’t go investing money and then come back because something failed. Get it right the first time and do the maintenance. It’s amazing how much it will save you in the long run.”

All facilities surveyed carry liability insurance. Many carry an umbrella policy, while other managers and owners have on-court pros who carry additional insurance. All try to keep unnecessary risks at bay by doing daily walk-throughs of their courts.

“We’re in an area where the land shifts a lot, so there are always going to be cracks in our courts,” says Gallaway, whose facility is in Northern California. “I know that cracks can become a danger situation. If I have one major crack and it’s a hazard and one person could trip on it, I’ll have someone go down and fix it. If I wait until my members tell me it’s time to resurface, it’s too late.”

The need to ensure member safety, the need to balance the budget, and the need to keep courts busy are all topics familiar to facility managers, although it’s not often they get the chance to have a dialogue on those subjects. In 2009, the PTR offered its first Tennis Club Owners and Facility Managers Conference. According to Santorum, the conference was a revelation to the PTR as well as to the participants.

“The most important part to them was the networking they did,” he notes. “We found they really enjoyed meeting other club owners and sharing best practices.”

For a number of years, the TIA has been increasing the resources and tools available for tennis facility owners and managers when it comes to networking and running their businesses, says de Boer. “We offer online technology webinars, and we’re working on setting up expert panels for facility and retail advisory councils. We started taking these steps last year, along with our efforts to help jumpstart the market at retail.”

Staying hungry

No matter whether a facility serves families in the suburbs or is situated in the middle of a retirement community, no matter whether it’s a high-end club in a gated community or a public facility in the middle of a major city, owners and managers say that the key to survival is staying fresh and ready for whatever shot the economy puts over the net next.

Ray Major says that at the Fretz Tennis Center, “We’re constantly trying to think of new ways to reach our customers, to give them good service and give them things they’ll enjoy. We offer specials and ways to help them stretch their dollars a little further. We want them to know that we understand the economy’s bad too, and that we’re with them on this.”

“I’m always trying to stay involved and keep myself fresh,” says Miller. “We’re always trying to get better and not sit back and enjoy having the clients; that’s not the way we operate. I’m just a tennis nerd through and through, I guess, but our members seem to like that and they keep coming back.”

Quick Facts

The TIA survey of facilities revealed the following trends

Group lessons and private clinics combined accounted for about 60% of expected tennis revenue.
A typical facility will have two to three staff members affiliated with USPTA and/or PTR.
There was an 18% reported increase in the annual tennis revenue per court.

See all articles by Mary Helen Sprecher

About the Author

Mary Helen Sprecher is the managing editor of Sports Destinations Management Magazine, a niche business-to-business publication for planners of sports travel events, in addition to being an RSI Contributing Editor. She is the technical writer for the American Sports Builders Association and works as a newspaper reporter in Baltimore City.