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The club at cordillera

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Reference no: EM133252648

Case study on The Club at Cordillera

Taking over a golf club in a deep economic crisis is a big feat. That's exactly what David Wilhelm did when he purchased the Club at Cordillera in 2009. Wilhelm purchased the Club at Cordillera with big plans to turn the club around with the help of the members. The use of referrals was going to be one of the new implementation techniques to take place in the summer of 2010.

These referrals offered incentives to members and included annual dues reductions and reductions in prices at other clubs owned by the Wilhelms. This program was good in theory; however, of the 500 members, only 44 members participated. Another objective for the new owners was to recruit 40 members to upgrade to premier packages that offer benefits at other properties. Between these two programs, the hope was to generate $6 million. In fact, the programs only generated $1.6 million. In 2009 the Club at Cordillera had a $6 million deficit.

Who's to blame for the financial crisis at The Club at Cordillera? According to owner David Wilhelm, it's the members. Wilhelm wrote a letter explaining the shortfall of the programs that seemingly placed the blame on the members.

Wilhelm held a town meeting with the members to ask for personal loans amounting to $35,000 from each member to help get through the end of the year. Members refused the offer. Instead, they created their own proposal to take over the club if it ended up bankrupt.

The members proposed a ballot vote. The first issue to be voted on would authorize the metro district to buy the course. The second issue to be voted on would raise $15 million to buy it through bonds. This option would raise property taxes an alarming $3,300.

This dilemma shows what can happen when the operations in a club are not clear, concise, and carried out properly. The poor decisions made by the owner and operators have driven the members away. More than 300 members have asked to terminate their membership with The Club at Cordillera.

What mistakes did the owner make? How could they have been avoided?

Reference no: EM133252648

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