STAFF COMPENSATION is the largest expense in any club. In fact, industry data shows that at the median, 55 percent of a club’s total revenue goes to payroll.
While distribution of labor expense among the club’s departments does vary somewhat based on club type, food and beverage (F&B) consistently claims the largest share. The majority of F&B positions are hourly and F&B requires significantly more hourly workers than other departments. To some extent, a club’s F&B labor allocation might also be considered a reflection of its culture and the members’ service expectations.
In a departmental breakdown of labor expenses for clubs with golf, the portion going to the food and beverage department is 35 percent. For clubs without golf where F&B is the club’s primary offering, F&B labor accounts for a larger percentage—42 percent at the median. In addition to F&B, clubs without golf put emphasis on sports and recreation (aquatics, fitness, tennis and racquet sports). Industry data shows that clubs without golf spend 16 percent of total labor on non-golf sports and recreation versus 8 percent in clubs with golf as the pie chart shows.
For perspective that may be helpful for budget discussion in the boardroom, payroll including taxes and benefits for a typical club’s senior management team accounts for 23 percent of its labor expense. Senior management includes general manager, executive chef, head of finance, superintendent, head golf pro, assistant general manager and human resource director.
