The Green Fee Today I did my normal after work routine and stopped by a few used club shops that are by where I work. The firs tof which was a Play it Again Sports. This spot has always had a small selection but usually its older stuff and not of the highest quality. It was different today. I walked in and saw this
The bubble
During the pandemic we saw a lot of people get into golf. It was an outdoor activity that was easy to social distance at. People wanted to find ways to leave their house and golf was the perfect way to do it. We saw rounds increase at a rate not seen in a long time. The equipment industry saw a massive boom. Companies to this day cant keep up with demand. They are producing items that were ordered 6 months ago. Grip and shaft suppliers are not able to keep up with demand. It has trickled down into children’s clubs as well. Parents were introducing their kids to the game as a way to get their kids out of the house as well. I also love finding great value on the used market. In the last year though prices have skyrocketed. Clubs that would have retailed for 100 bucks last year have jumped to 200 sometimes even 300 dollars. Its been sheer madness.
Why the concern
The first thing that caught my attention was the absolute plethora of children’s clubs. All heights were included. Now Play it Again has always had kids clubs but not nearly to this extent. I have been watching it pile up for weeks. Usually some stuff comes in then it moves out. This is not the current situation. They are slowly piling up. As I walked around to the adult clubs I saw the exact same. The clubs are starting to pile up there as well. When I go in the same clubs are there week after week after week. The same Cleveland CG2 blades look me in the eye daring me to buy them. There are everything from cheap 90’s Dunlop irons all the way to new D9 irons, and none of it is moving off the shelves. Hell the putters are still there. They have had 2 Taylormade Spiders on the shelf for a month now.
When I walk into a big box store more and more clubs are in the preowned section. The used putter rack is starting to stay full. As early as 2 months ago there would be 4 or 5 putters and now its a legit 15. They arent moving. Is the preowned market slowing down? It seems to be and if it is what does that say about the new club market? Are golfers going to rush to the store for all new clubs knowing the OEM’s are so far behind?
The biggest concern now is for 2022 planning. Will the demand for golf equipment, both preowned and new, still be as high in 2022? OEM’s and retailers have to be planning for it to be a much heavier demand than they expected last year. That means a surplus of inventory. What if the demand suddenly drops and all of those people who took up golf in 2020 suddenly leave the game for the same reasons they never played golf in the first place. The kids have sports again, the movies are back, or they can go out to lunch with their signigficant other. Maybe they picked it up to spend more time with their kids and now the kid realizes they dont like it so the parent quits too. In late 2022 are we going to see stores with a ton of excess inventory trying to get rid of it with no success? That was the downfall of Golfsmith. They carried a ton of excess inventory, the OEMS released new clubs often and golfers constantly wanted the newest thing making old inventory worthless.
If we thought the golf boom was interesting lets see if this was all just a bubble. Will it pop or continue to get bigger?