If I were the Minister of Culture, Sports and Tourism <Planning Series> ⑥
Golf courses, the level of profiteering that they take after putting in electric carts is beyond imagination
Korean golf course carts are equipped with electric carts. These carts allow golfers or caddies to stop or start a cart carrying a golf caddie bag by controlling it with a remote control during a round. You can stop it when you remove the club and put it in during the round, and press the remote control to move it to the next shot.
In most Korean golf courses, caddies mostly use electric carts. If owners change their minds, cart guide wires and electric carts are important facilities for golfers to reduce costs. However, golf course owners entrust their caddies with electric carts as a means to make excessive profits.
The level of profiteering that the owner earns by putting in carts is beyond imagination. It is an urgent issue for the relevant authorities to step forward and improve. In the ⑥ of the <Planning Series>, we will look at how much golf courses profit from using electric carts.
KBS, "Isn't it a profiteering?"... In-depth coverage of golf course cart fees
On December 27, 2022, KBS made an in-depth report on Cart fee. In this report under the title, "Isn't it a profiteer? Why the golf course cart fee is regrettable", it points out in detail the structure of golf course owners putting in carts and taking profits. The KBS report is as follows. The content is a little long, but please read it until the end to check the actual situation.
■ Domestic carts outpace foreigners in market share... Domestic carts cost around 15 million won
Resistance and opposition to the expensive golf course cart fees are increasing. It is not for user convenience, but for profit maximization, the golf course makes it mandatory to use the cart, but it is operated in a way that pays the cart usage fee to the customer.
Golf courses introduced carts to keep the seven-minute tee-off time interval between teams and to receive more teams. As of October 2020, the Korea Leisure Industry Research Institute analyzed that the national membership golf course cart usage fee was 96,700 won, and the public golf course cart usage fee was 91,100 won on average.
The number of golf courses that charge 90,000 won (approx. The number of golf courses that charge 90,000 won (approx. The number of golf courses that charge more than 90,000 won) surged from 19 in 2017 to 303 as of October 2022. Golden Beach in the Seolhaewon area is 120,000 won (approx. Some places, such as Namyangju's Sea Beach FC, charge 130,000 won (approx.
Domestic carts have surpassed foreign market share. This is because domestic manufacturers supply batteries. Among the 4,000 carts placed at golf courses in Korea, more than 2,800 are domestic carts, with Korea dominating the ratio of 6 to 4. The Japanese Yamaha cart, which accounted for up to 80 percent of the carts until four to five years ago, has gradually given way to domestic carts since 2008. Among domestic carts, 40% is for the market, 40% is for Yamaha, and the rest is divided by domestic small manufacturers.
The purchase price of domestic carts is around 15 million won. Due to the characteristics that fluctuate according to the exchange rate, Yamaha carts are formed about 2 million won higher per unit than domestic carts. The core of golf carts is battery technology.
The service life of Korean and Japanese carts is similar. Cart manufacturers promote that the cart can be used for up to two years of vehicle quality warranty, five years of battery quality warranty, and up to 10 years depending on management.
■ Cart purchase cost "recover principal in 6 months"... Is it true?
Based on an 18-hole golf course that receives 40 teams in the first part and 40 teams in the second part, the total number of carts is about 60, including spare carts in case of breakdowns, considering charging time. A golf course that receives 15 teams in the third part of the night round requires up to 70 to 80 teams.
If you buy 80 units for 15 million won per unit, the purchase cost is 1.2 billion won. The cost of reclaiming the guide line that automatically moves the cart along the guide line is up to 150 million won based on 18 holes, which can be used semi-permanently.
The battery replacement cost is 5 million won per unit. If all 80 batteries are replaced after five years, the replacement cost is 400 million won. Assuming that the cart will be operated for 10 years, the total cost is 12.75 billion won.
If the cart is operated up to Part 3 after paying 100,000 won (88.31 dollars) per day, 95 teams will receive 9.5 million won (8.31 dollars) per day. It is calculated that 184 days after the cart is purchased, the principal amount invested at the time of purchase and all battery replacement costs will be collected after five years.
In other words, the golf club can earn net profit from six months after the purchase. If the cart is operated for 10 years after the purchase, the net profit to be collected for the remaining nine years and six months will be a whopping 32.5 billion won (30.2 million U.S. dollars).
■ Daily cart operation fee based on electricity, maintenance, and depreciation costs?... 12,000 won per day
Usually, the depreciation period recognized by the tax authorities is calculated as 5 years. If the cost of purchasing a cart is 15 million won per car, the vehicle depreciation cost is 250,000 won per month. It is reduced to 25 days of operation per month, and 10,000 won is the depreciation cost equivalent to one cart.
The electricity cost for charging a cart is only 1,360,800 won for charging 60 carts based on lithium-ion batteries, and 1,814,400 won for those in their 80s per month. The charging electricity cost per golf cart is 756 won and 22,680 won per month. The annual maintenance cost per golf cart is an average of 29,312 won in Korea and 80 won per day. The depreciation period is five years, so battery replacement costs are not included.
The cost of landfilling the cart guide line was calculated at 1,041 won per day for five years in line with the depreciation period of the tax authorities. The cost of landfilling the guide line is 1,878 won per day, including electricity, maintenance and repair, and the cost of landfilling the guide line, so even if the daily operating cost, including the depreciation cost of 10,000 won, is set at 12,000 won for convenience, 88,000 won will be profitable if the golf course receives 100,000 won per cart. If the golf course operates for five years, the profit is 12.772 billion won.
■ Cart usage fee "It is right to make it free or make it a reality"
Regardless of whether you follow either the principal recovery method or the depreciation method, you can see how unreasonably the cart usage fee has been set, pointing out that the golf course is profiteering from the cart usage fee.
It is not a cart for consumers, but a cart for a golf course. Consumers insist that carts should be made free. The opinion that it is right to realize it as soon as possible, even if it is not free, is gaining strength.
If the golf course does not implement it on its own, the relevant administrative agencies should forcefully adjust it and ensure that the cart usage fee is not passed on to green fees or other charges. The Fair Trade Commission, the Ministry of Culture, Sports and Tourism, and the National Tax Service should take the lead, and consumers' demands are that it should be corrected even if it is late.
Recovering the principal in 184 days after purchasing the cart... nine and a half years of profit
What do you think? Assuming that 80 carts are used for 10 years, the principal recovery period is only 184 days in an 18-hole golf course, resulting in a whopping 32.5 billion won in revenue. Even when depreciation costs are taken into account, one unit generates a profit of 88,000 won per day, and if operated for 5 years, it will generate a profit of 12.772 billion won. This is a completely 'groundless swimming' method of profiteering.
It is judged to be multi-faceted and in-depth reporting. Of course, the owner of the golf course can feel unfair that KBS's reporting did not take into account all the circumstances that they could not say. Most of all, I was surprised to learn that it is a structure that allows me to buy a cart and use it for 10 years, but only collects the principal in six months (184 days) and continues to make profits for the rest of nine years and six months.
KBS reports that there is no reduction in cart fees... Bae Chaerasik sales
KBS reports have revealed that the purpose of golf clubs' purchase of carts is not for customers' convenience, but for profit by receiving more team members. In the event of such painful news, there is no news even though golf clubs have to take measures such as lowering the cost of carts autonomously. "KBS, make some noise as you wish, we're just going, " is showing a gut-wrenching behavior.
Most golfers do not realize that golf courses are "cart fees profiteering" to this level. They vaguely accept that it is expensive. Perhaps, some golf courses will increase their cart fees again just because the prices are going up. Despite this, the authorities are not taking any action.
There is another problem. Some golf courses are known not to directly manage the operation of carts, which is the goose that lays golden eggs, but to give goodwill to specially related persons such as the owner's family. If a golf course corporation makes a profit by directly managing carts, it will be exposed to tax authorities, so there is a hidden purpose to avoid it by using a separate corporation. Therefore, the tax authorities should conduct a fact-finding investigation and thoroughly investigate whether there are tax evasion or tax evasion.
Some golf course owners, cart sales special officials, hide their profiteering
If the golf course corporation directly makes a lot of profits through the operation of the cart, it will have room to lower the green fee. And if the golfer can drive the cart himself, the burden of caddie can also be reduced. If the green fee and cart ratio fall to an appropriate level and the caddy selection system spreads, the cost per person in the first round can be reduced to between 100,000 won and 150,000 won.
No other country in the world costs between 1.5 million won and 2.5 million won per team for a single round. This formidable cost of golf must be lowered. This way, it can reduce the burden on golfers and make golf courses more international competitive. We can get rid of criticism that we are a bad company that is greedy to the core and takes advantage of our country's golfers and their people, and a traitorous company that makes them donate their precious dollars to foreign countries.
I repeatedly urge golf clubs to voluntarily appreciate the situation. If that doesn't work, the relevant authorities should roll up their sleeves for sure. The sooner, the better for the sake of golfers, golf courses, and the Republic of Korea.
Today, based on the KBS report, we looked at the profit of cart fees in golf courses.
The Story of Maudae’s life and golf continues.
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