It well known that ‘natural’ or ‘uncontrollable circumstance’ attrition rates average around six to eight percent for golf and country clubs and can range as high as twelve to fourteen percent in city and yacht clubs. The most common uncontrollable circumstances revolve around health issues, death, relocation and financial hardship.
The loss of even a few members can make it necessary for a club to decrease operating expenses by offering fewer services and amenities to existing members; deferring maintenance and renovation projects; or cutting back on staff.
Any, or all, of these steps can decrease member satisfaction to the point where it causes even greater membership attrition and financial loss.
Below is a quick illustration on how a subtle change in attrition rates can have a huge impact on membership levels, cash flow and revenue. Country Club A, B and C all have the same criteria of starting membership base, number of new members recruited each year, and annual dues. The only variable are the attrition rates.
Country Club A – 6% Attrition Rate over 5 years
- Membership Level: 426
- Membership Net Gain: 82
- Annual Dues Net Gain: $492,000
Country Club B – 8% Attrition Rate over 5 years
- Membership Level: 391
- Membership Net Loss: -23
- Annual Dues Net Loss: –$174,000
Country Club C – 10% Attrition Rate over 5 years
- Membership Level: 360
- Membership Net Loss: -130
- Annual Dues Net Loss: –$780,000
After only 5 years, Country Club C ends up with a net dues loss of $780,000 and Country Club A ends up with a net dues gain of $492,000. That’s a swing in net dues revenue of $1,272,000!
Although it may seem that these ‘uncontrollable circumstances’ on attrition rates are impossible to fix. And to some extent, they are. But when a club emphasizes increasing membership growth; increasing engagement with relevant programming; and enhancing member satisfaction and club usage, clubs will better equipped in decreasing the number of ‘controllable circumstances’ related to attrition rates.