Minutes - 02/28/1991 - Bath & Tennis Members' CommitteeOAK BROOK BATH & T t3JTd I S
MI MT-2s OF 2 -28 -91
ADVISORY COV11ITTEI]
(MD-- b4,,T"" MW
a° R.IR -9t
The meeting of the advisory committee was called to order at 9 :40 a.m.
,-- All members were present except Renee Cronin. Also present was Mr. 1,TcAdams.
The minutes of 2 -21 -91 were amended and approved.
Many positive and hopeful comments were received by Starr Pitsch in response
to the committee's letter to the trustees.
An effort is currently being made to define members' expectations to help
the B&T in future decisions. A list of these expectations is attached.
The committee is trying to made the restaurant more attractive to members
by encouraging Wednesday diners. Along with tho re,;ula,r. Wedne ^day ni ,-ht
tennis activities, an expanded buffet will be available as Wednesday night
family swim activities will be part of the many change; to take place to
improve this facility.
It is unfortunate that no one who actually sells merchandise in the tennis
pro shop is given a commission; but since 1000 of the sales is already being
given to another staff member, we feel we cannot afford any additional
commission expense.
The committee members + hn `, thr, 1 ock,,r -ronri , be in good condition
prior to the season's openinL. t t-y : �,oulo h, p - -inted so members
could "see" the difference.
A continuation of today's meeting will take place on 3 -5 -91 at 9 :30 a.m.
3-5 -91 Meeting been at 9:40 a.m. 111 comr,iitterl ,) -tubers were p.0e-,ent,,
including Mr. McAdams and Karen Bushy.
Discussion took place regarding; membership. It was agreed that TD cards be
used and tickets made out for guests. We fecal it would be advantageous for
the pool manager to check the sign -in sheets and tickets every evening. Tf
a problem exists, an eye can be kept on it, however we still would like the
atmosphere to be relaxed.
Specific Recommendations:
1. Discontinue early sign up discounts (312,000 budget item). Want to provide
an alternate method to get people to join early.
2. We are working on a plan to bill past members instead of using the
renewal registration every year.
3. Discontinue gift certificates (8500.00 budget item).
4. Employee meals - agreed to keep an eye on - Stricter adherence to
meal regulation.
5. Refreshments be made available at swim meets. Perhaps some parents
should go to the weekly meetings to give any needed suggestions. A
procedure is needed to allow ease in collecting cash at these events.
6. Getting the pool operational before the season begins is imperative.
Karen Bushy suggested that better communication is necessary to explain
to members any problems that may arise.
Meeting adjourned at 12:05 P.M. T� ectfully__`' b 1iitted,
I'amcla. Pa.wlo,iski
,)ecretary
!�(JVL;ory Colz,Il tee
. wont
[E cq-" Ea U Wr 12
MAR ° T 1991
MEMBERSHIP EXPECTATIONS
In the past months we have become a little more experienced and
developed a better understanding of the scope and time pressures
of your position. We realize that there will always be instances
when you will have to make immediate decisions that we will not
have the opportunity to comment specifically on. For that reason
we thought it might be helpful to provide you with a general
guideline priority list.
This list is based on the members' comments that we have received
and our own experiences. It represents the absolute minimum that
members feel they are entitled to by their membership fees. It
is not a wish list. Rather it is the difference between member
satisfaction and dissatisfaction.
1.Clean, safe and functioning pools.
2-Clean and well maintained locker rooms. (By locker rooms, we
are referring primarily to the shower and bathroom areas.)
3.Well maintained tennis courts.
4.Edible food served in a clean environment. (Note: More B & T
members,children and adults, regularly use the BBQ Hut than the
Restaurant.)
D
5.Facilities open when scheduled.
6.Courteous service from the staff.
Because we feel so strongly about these issues, let us
reemphasize one point. It is our opinion that unless these
expectations are met, nothing else will matter. To give you an
example: Members thought the new gazebo by the tennis courts was
fine. But they couldn't understand why you could find the money
to build that but there was no money to fix the broken
showerheads or ceiling tiles in the lockerroom. Or why one of
these carpenters couldn't have walked over and fixed the broken
picnic tables at the BBQ Hut.
We hope you will agree that none of these expectations are
unreasonable. We have discussed all of these items with
Mr.McAdams. We have no objection to other B & T improvements in
general, but we do object if they are done at the expense of
these items. So whenever you are asked to approve a B & T
expense, we would ask you to consider the members' priorities.
We intend to help Mr.McAdams track these during the season. We
also thought it would be helpful if we gave you a status report
on where these expectations stand right now and our
recommendations for achieving them for the coming season.
This list has been prepared in order of priority.
Pools - Recommended preseason maintenance
1.Cleanliness improved last year but main pool needs to be
repainted.
2.Safety was a problem. Last year children were cut by loose and
broken pool tiles. All should be checked and defective tiles
replaced prior to opening.
3.Functioning equipment - Nothing can guarantee there are no
breakdowns. But members believe last years preseason maintenance
was inadequate and that this contributed to last year's
malfunctions. We recommend that a 2nd maintenance firm be
interviewed. If the two evaluations are similar, then all work
should be done. We are especially concerned about defective
filters. This is not a good time to take a chance. It would be
better to err on the side of caution. The furnace should be
turned on early so that any problems can be corrected prior to
opening day. Heating the pool is especially important at the
beginning of the season as the weather is cooler.
Locker rooms - A recent inspection (March 1,1991), showed there
is a lot of work to be done here. (Comments are for both men's
and women's unless specified.)
1.All stained, chipped, torn or missing ceiling tiles must be
replaced.
2.Broken locks on bathroom stalls must be repaired or replaced.
3.All shower heads, drains and faucets should be checked and
repaired. All curtains should be cleaned or replaced.
4.In the men's locker room, the outside door leading to pool is
in terrible shape. The paint is all bubbled and cracked. In the
same area floor tiles and moldings are missing.
5.In women's locker room at least 1 wooden seat in shower stall
is broken and has to be replaced.
6.Both locker rooms should be repainted a new color. Nothing
would be a stronger symbol to the members. It has been pointed
out to us that the Clubhouse front doors and facia also need
repainting.
We didn't have time for a complete inspection, but this will give
you an idea of the amount of work to be done.
Preseason pool maintenance and locker room repairs are our #1
priority.
For reasons of safety and security, we have recommended that the
split rail fence along both sides of the south end of pools be
extnded. This would eliminate illegal parking on grass which is
no longer necessary even on busiest days. It would also help
enforce membership and guest rules by making it harder to enter
the pool area there, encouraging everyone to come by the front
desk.
BBQ Hut - All picnic tables should be in good repair. We have
suggested bullet style garbage cans for picnic area. This would
keep animals and birds out. Vinyl tablecloths could be wiped
clean during the day and taken in at night. Inside the Hut needs
a thorough cleaning. Unused and broken equipment, chairs and
card tables should be thrown out. New shelves are needed to
stock and display candy and chips. Staff needs better training
on basic sanitation and food preparation.
Tennis - This is one area where the members saw improvement last
year. We received many positive comments on the daily
maintenance of courts. The completed repair of the upper court
curbing will be seen as another positive. The only item left to
be addressed this year is the replacement of torn nets.
Facilities open - We have stressed the importance of this to
Mr.McAdams and he has passed the word on to staff. We have
recommended that permanent signs be purchased and posted at each
facility listing hours of operation.
Service - One simple way to encourage good service is by clearly
identifying each employee. We have recommended that every B & T
employee be issued a name tag and /or identifying apparel to be
worn while on duty. Members of the committee have volunteered to
meet with any staff members and discuss members' service
expectations.
B & T Members Committee
approved March 5, 1991
W iT-H
i S® -- S %T- �n � ,� •
a -019-11
INCREASING REVENUE
First let us assure you that we fully support the concept that
user fees fund the operation and maintenance of the Sports Core.
So that is where we began our financial analysis. Our intention
was to improve the B & T's financial position by increasing
revenue. °
The question of raising membership fees was one of the first
issues we were asked to consider last fall. Our recommendation
not to raise the fees was more of a marketing decision than a
financial one. We were hesitant to recommend an increase for two
reasons.
1.Member dissatisfaction was high. There was a real possibility
that we would lose members.
2.Anytime you raise fees you raise expectations. Members would
have expected to see significant improvements.
Instead we wanted to set °a goal of meeting (or even exceeding)
current member expectations. Better to surprise than to
disappoint. Then we would be in a better position to consider
raising membership fees for the following year if necessary and,
at the same time, attracting new members.
For this season we thought we could work on increasing revenue in
other ways, by increasing member participation and spending at
the B & T. We planned on recommending raising activity fees a
little bit and encouraging more members to get involved. Since
that would mean more members would be spending more time at the
Club, they would naturally be buying more food and drink.
Getting to know more fellow members would also increase interest
in social activities if they were planned to appeal to our
members. We thought this was the best approach for two reasons.
1.It would be a valuable long term goal to increase member
participation because it would increase their enjoyment of the
facilities and therefore the value they placed on their
membership.
2.It appears to us that the members who complain about the
membership fees are those who get the least use out of the
facility. By increasing activity fees the heavier users would
be providing the additional revenue.
We developed our plans around this concept.
Tennis activities - When we met with Tom Wangelin, the new pro,
we were delighted to discover that he had a much better
understanding of the types of social activities a segment of our
players desired. We believe he will build on the success Dan had
in the competitive, childrens and lesson programs, while
addressing this neglected area. But we also found out that,
due to contractual arrangements, we cannot anticipate much
improvement in the tennis bottom line no matter how many people
participate. 90% of all fees goes directly to the tennis pro
as a commission. So we would have to increase fees by $10 to
receive an additional $1. Out of that comes the other costs
Vli iTH 0
®2$ -9 1
incurred.
Mr. McAdams tells us that this is necessary to attract a pro of
this caliber. Since not having a pro like Tom would cost us
participants *and even memberships, we don't want to do
anything that would dampen his enthusiasm or desire. Raising
fees by $10 or more would be taking a risk and putting
increased pressure on a new pro following a very popular pro.
None of this seemed worth the very minimal return. We dropped
this idea.
Swim team and lessons - Here we discovered a similar problem.
In lesson fees, 90% goes directly to the teachers. In the case
of the swim team, particpation is so far down, we took in less
than half in fees what we paid the coach. Team revenue was
down 40% last year from the previous year. It is hoped a new
coach will turn this around. But it hardly seemed like a good
time to raise the fees. In addition, lesson and team fees are
so low, any increase would seem very significant and yet our
return would be minimal. We did agree that if the team wanted
t- shirts, fees would be raised to cover that. But we have
dropped the idea of seeing increased bottom line revenue here.
We are hoping they will cover their own expenses.
The Pro Shop - We thought we had some great ideas for
increasing revenue here. Wrong again. We average a 30% markup
here. Then we pay a 10% commission on total sales. On $12,000 of
sales last year, net profit was $1100. We had anticipated a
higher percentage of profit since the building and staff are
already there for tennis activities.
10% would be a good incentive to encourage someone to sell and
maintain the merchandise. Unfortunately, the person we pay it to
doesn't work in the tennis shop. She works in the golf shop.
The 10% is her compensation for buying the merchandise.
Not being easily discouraged, we offered our suggestions for
types of merchandise we thought we could sell more of,
primarily B & T logo items. We also suggested some additional
items members might find it a convenience to buy at the B & T.
The staff buyer expressed some reservations about our ideas. To
promote the shop and make members aware of the new items, we
had suggested they be shown in the fashion show at the Opening
Luncheon as the Golf merchandise will be. We have just
recently discovered that will be impossible as the tennis
merchandise is not scheduled to arrive until two weeks
after the luncheon.
The budget has been increased, so we will anticipate some
increase in sales.
Food Service - Maintaining our positive attitude, we turn to
the Restaurant and BBQ Hut. We discovered that on $356,000 of
business, we produced a $13,619 net. If business is increased
by the ambitious sum of $100,000 as projected for next year, we
would have an additional $9,000.
Then we discovered that even if all these efforts actually
.
resulted in increased revenue, B & T members would see no real
difference or improvements because it will all go to offset the
anticpated deficit.
Now please understand that we still hope and will work towards
increasing revenue. To do that in any meaningful way we would
ask you to consider the following (probably only applicable for
the 1992 season.)
1.The tennis pro's contract be written so that he would receive
90% commission of current rates. This would give us the freedom
to recommend a percentage increase or surcharge on each fee that
could go directly to the bottom line. It would remain his
incentive to enlist more players to participate.
2.If this swimming season is more successful than last years,
fees should be raised. Specialized activities such as teams and
lessons should at the least pay for themselves and make a small
contribution to the general maintenance of the facility.
3.As for the Pro Shop, with a former Marshall Field's executive
and a number of avid shoppers on this committee, we have more
suggestions than anyone would care to hear. But there is a
primary problem that must be addressed before all else.
The'best way to increase the margin of profitability is through
quicker turnover and improved merchandise display and care. This
requires daily care and attention. The best way to encourage the
tennis staff to do this is to offer them a commission on sales.
The current system is that the buyer receives a 5% commission on
what she actually sells at the Golf shop and 10% on everything
sold at the Tennis shop where she is not scheduled.
We agree that there is not enough volume to schedule any one in
the Tennis shop just to sell. However, it is normally a buyer's
responsibility to visit the site regularly to check the stock,
merchandise the stock and meet with sales people.
The 10% commission on total sales is high by retail standards.
In this case it would prevent us from recommending an additional
commission. Since hourly employees are already scheduled to be
in the tennis hut, it would be the natural way to encourage them
to pay a little more attention to the merchandise. If the 10%
could be reduced, then we would recommend the difference be
offered to the tennis staff.
B &T Members' Committee
approved March 5,1991
0�$T-- Mid
q LIAR 7 1991
CUTTING COSTS
We will admit to being a little discouraged at this point. But
seeing and hearing reports of B &T deficits ranging from $46,000
to $85,000 gave us all the incentive we needed to continue. We
went to the next step. When you can't increase revenue, you cut
costs. It is not as much fun but the end result is the same.
To do this we had to get a handle on what our costs were. We
first determined that it cost $65,519 to run the pool after
deducting the swim revenue and $36,486 to run the Tennis area
after deducting their revenue. These expenses totaled $102,005.
This seemed manageable on membership revenue of $228,295.
Finding out that the Food Service covered all their own expenses
and produced a small profit of $13,619 made the situation seem
even better.
This was when we discovered OVERHEAD ALLOCATIONS. These are
general Sports Core expenses in two categories - General
Administration and Buildings & Grounds, which were each divided
in half and charged against the two Sports Core operations - Golfe
and the B &T. Since we had determined that membership fees were
our primary source of revenue, it came as something of a shock to
discover that our overhead allocations ate up 83% of our total
membership fees. This was $189,103 in overhead allocations vs.
$228,295 in membership fees in 1990 -1991. Since this was the
largest expense, we started our calculations over. We deducted
total B &T overhead allocations from total B &T membership fees.
$39,192 was all that was left. Then we had to deduct $22,912
from that to cover additional administration costs listed
separately under B & T Administration. That left $16,280 to
operate the B & T.
Since we didn't see any way to cut costs around the pool and
tennis courts from $102,000 to $16,000, we felt that we had no
choice but to begin by looking at our largest expense - OVERHEAD
ALLOCATIONS.
In the course of our discussions on how to lower this cost, we
began to wonder why certain items were included, why others were
left out and how the percentage had been determined. Mr.McAdams
responded to our questions and eventually agreed to make a couple
of changes in these allocations.
1.He has agreed that the B & T does not rquire nor receive 50% of
his or his staffs time so he has lowered our percentage of the
General Administration allocation from 50% to 35 %.
2-He has also agreed that it is more accurate to list polo income
as General Administration income than as Golf income.
For 1990 -91, the total result of these changes is a decrease in
our total allocations from $189,103 to $139,541, reducing the B &T
total deficit by $49,562.
oL
Since then we have raised some additional questions. These
discussions could go on and on. The positive result at this
point is that you have a more accurate picture of what it costs
to run the B &T and the comparative contribution the members are
making. But these questions have no effect on the Sports Core
bottom line, which is your real concern.
It also doesn't seem to address the real issue. Which to us is
that an organization has been set up based on what is required to
run the Golf Course, not the much more modest needs of the B &T.
Then our smaller operation has been assessed a sort of tax
forcing us to support half of that organization. Then we have
been judged by our inability to do that. You know that we have
been very sensitive on the issue of the B &T draining money from
the Golf operation. This is the reason.
Please don't misunderstand. We are not asking to secede from the
Sports Core. It makes perfect sense, since you have to have all
this for the Golf Course, to improve its profitability by using
it to run and maintain the B &T. And the B &T does benefit from
this relationship. What we are asking is that you consider our
position. Even with the changes agreed on, more than half our
membership fees still go to these overhead allocations. Before
we even turn on the water in the pool, more than half the money
to support our facility is gone.
Between our own facilities and these allocations we are being
asked to support two sets of offices, two sets of office
equipment, 4 full time employees, a maintenance crew,
unemployment compensation for this crew, etc. All for a club
whose members get to use the facility 3 - 4 months out of the
year.
The fact is that for the 1990 -91 season, the B &T had $116,997
left after paying tennis, swim and restaurant staff and expenses.
This is still more than half our membership fees. Now we don't
know if that is enough to pay the utility bills and maintain the
grounds, etc. We can't determine that from the combined figures
that we have been given. But that should be the question. That
is the only way to determine if B &T membership fees are actually
supporting the operation and maintenance of the B &T.
What do we do now?
We could continue to go through the budget line by line and ask
Mr.McAdams to break out all costs individually for Golf and B &T.
Or we could continue to hammer on the allocations? We are still
being assessed 35% on G/A and 50% on B &G. It is our opinion both
are still too high and we are prepared to argue our case. But
what is the result? This committee and Mr.McAdams spend a lot of
time and energy on issues which will not improve the Sports Core
bottom line at the expense of other projects we could be
addressing which might.
OR
W% 0
We can drop the whole thing and sit quietly by whenever the
subject of what a drain we are comes up. The positive result of
that would be that we go back to trying to actually improve the
B &T. The negative result of that would be that you will continue
to make decisions on fees, improvements and expansions based on
what we consider unfair perceptions.
What do we do if next year you decide to recommend an increase in
B &T fees because of this deficit? If we could see that fees are
not covering reasonable B &T expenses, we could support an
increase. But in all good conscience, it would be very difficult
for this committee to recommend an increase in membership fees,
if the increase is simply going to be used to pay for more of
this organization. Especially since our experience tells us they
respond first to the needs of the Golf operation and second to
the needs of the B &T.
We know that right now B &T members neither desire nor need any
expensive improvements or additions. our facilities are fine but
there are going to continue to be maintenance costs. Will some
of those be delayed or postponed because of this?
We need some direction from you.
Do we have to continue this process until we get the numbers to
show the B &T in a position where it might actually be possible to
meet our expenses and even someday have a little left over for
improvements?
Is there a fairer system of evaluating whether members' fees
actually support the B &T maintenance and operation?
Is there some way we could stop hearing about and seeing reports
showing the B &T as having huge deficits?
If you remain unconvinced that the B &T is being unfairly
evaluated, then let us present one final fact. Last year, the
Golf Course had total revenue of $1,122,343. For that same
period the B &T had total revenue of $649,941. Is it any wonder
that we can't as easily absorb the same high overhead that they
can? Is it really fair to charge us the same amount? Even with
the agreed to changes the percentage of our revenue going to
these allocations remains considerably higher.
Thank you for taking the time to consider all this. We look
forward to receiving some direction from you.
B &T Members Committee
Approved March 5,1991