Sign up with Google
The_Right_Honourable_Brit
High Tory
- Joined
- Mar 6, 2004
- Messages
- 41,693
Wow...considering 'we' (South Africa) don't have such a competitive cycling culture (as compared to France/Spain/Italy), that statistic is amazing. 
Continue reading: http://www.moneyweb.co.za/moneyweb-business-of-sport/cycling-is-the-new-golf
SA has the highest per capita spend on cycling equipment in the world – supplier.
Arguably the fastest-growing sport in South Africa, cycling has taken the nation by storm and many believe it will usurp the prized position long-held by golf as the corporate sport of choice.
All you need to do is take an early-morning drive to the Cradle of Humankind one Saturday, about 50kms northwest of Johannesburg, to see the cyclists hitting the relatively vehicle-free road by the hundreds.
Conservative estimates put the value of the cycling-as-sport industry in South Africa at R600m. But Stephen Reardon, CEO of MoreCycle, which houses Cycle Lab, thinks this figure is around R1bn.
“The year-on-year growth of this industry is certainly in double-digit figures, while we’ve seen the number of registered golfers remain relatively static with participation trends flatlining,” Reardon says. “Our general view is that cycling offers double the opportunity that golf does, if you look at the participants and what they are spending.”
With some bikes fetching the same eye-watering prices as new cars and more affordable models easily costing upwards of R20 000, it’s no wonder that the MoreGolf Group, which houses the Pro Shop, bought Cycle Lab in September 2013.
“We saw many of our customers taking up cycling and our interest was sparked. We believed we could leverage our specialist retail competencies to deliver a credible retail experience to cyclists,” says Lloyd Waldeck, CEO of MoreCorp Retail. MoreGolf and MoreCycle are housed under parent company, MoreCorp.
“We thought golf was expensive until we got involved in cycling,” jokes Reardon, adding that one of the international suppliers revealed that South Africa has the highest per capita spend on cycling equipment of any country in the world. “This reflects that cyclists at all levels are spending a significant amount of money on the sport,” he says.
“The cost of cycling versus golf depends purely on the purchasing decisions made by the participant,” adds Waldeck. “Both have relatively low entry points at around R3 000 for reasonable quality equipment. However, the enthusiast is able to invest much more money in a bike (up to R190 000) than a set of golf clubs (R25 000).”
Reardon agrees that the potential spend is higher in cycling than it is in golf. “The ongoing cost of golf is what puts a lot of people off, as well as the perceived value of a club membership versus owning a bike. The latter has a higher perceived value, since it makes you healthier and is less time consuming, leaving more time for family and friends,” he notes.
Input vs. output
Marketing manager for the ProShop, Trevor Rebello, says that people who were taking up golf are finding it more difficult to do so, as a result of money, time and a steep learning curve. “Golf is probably not as expensive as cycling, but it is perceived to be. It is also time-consuming. People who play golf are pressed for time and electing to take up sports and hobbies that demand less time,” notes Rebello.
Although the ProShop has seen a steady rise in the sale of golf clubs over the last few years, this has been driven by better value offerings, significant improvements in golf club technology and the increasing adoption of golf among the emerging middle class. “We have, however, seen the rate of growth in juniors, ladies and adult beginner golfers reduce, while the avid golfer continues to invest in equipment,” says Waldeck.
“It’s easier to take up cycling than it is golf. The more you cycle, the better a cyclist you are likely to become. This is not necessarily true of golf, which has a steep learning curve that people find threatening, especially if they are taking it up later in life,” Rebello explains.
Reardon agrees. “Everyone is a potential cyclist and the scale of improvement is binary to golf. With golf, you can play for years with little guarantee that your game will improve. Put someone on a bike and they will lose weight and improve their cycling rapidly, so the input-output dynamic is very appealing,” he says.
The golf market
Roughly speaking, Reardon says there are around 500 000 golfers in the country, classified as individuals who own clubs and play to some degree. Of these, there are approximately 130 000 male golfers and 20 000 female golfers affiliated to golf clubs in South Africa. About 70 000-100 000 are avid, in that they play 40 times a year.
Bruce Younge, executive director of the South African Golf Association, the governing body for amateur golf in South Africa, says that member numbers have declined by about 5% over the past ten years, remaining fairly static over the last five years.
“The disturbing factor is that prior to that, there was probably an annual increase of 1-3%, but this has bottomed out and stabilised. The decrease at the time was generally, in my opinion, for financial reasons connected with the global recession. The reason numbers haven’t climbed is that people have not yet recovered [from the recession],” he says.
“There has been a dramatic decline since 2008. The Gauteng region has shed 6 000 golfers and nationally 10 000 were lost,” adds Bill Swailes, president of the Central Gauteng Golf Union. Ironically, Swailes is using a strategy implemented by executive director of British Cycling, Peter King, which enabled him to turn British cycling around over 12 years, to revive golfing in South Africa. “King’s philosophy and the subsequent turnaround of the sport in Britain was based on changing it from amateur led to professionally driven. I’ve taken up the same mantle for golf in this country,” says Swailes.
Randpark Golf Club, which is where Swailes implemented this strategy back in 2007, is one of the most profitable clubs in South Africa and the only club with a waiting list for membership. “The club is family friendly and run like a business for the community it serves,” says Swailes who is working with other Gauteng clubs on strategic plans, hoping that clubs in the rest of the country will follow.
Products from MoreGolf such as playmoregolfSA and lastminutegolf are trying to drive the cost of golf down. “Playmoregolf has 15 000 members and about 45 000 rounds of golf are booked each month via discount channels. This has helped stimulate golf to some degree,” says Reardon.
The SAGA’s constitution was amended five years ago to provide for golf development funding. Provincial golf unions, which are members of SAGA, invest R5m a year towards promoting and developing golf in previously disadvantaged communities. This money comes from a portion of affiliation fees paid by members to clubs.
The cycling market
It’s far more difficult to come up with exact numbers of cyclists, since the figure depends on who is classified as a cyclist. Reardon pitches the number at about 1m, including in this figure people who own a bike and ride with some regularity. “Between 200 000-300 000 cyclists are participating in events and we perceive this figure to have double-digit growth at the moment,” says Reardon.
He says cycling is becoming a major attraction for corporates. “Companies are arranging corporate days around cycling events and planning cycling trips away. There are a number of corporate cycles, like the Tour de Tuli, which offer the same networking opportunities that golf tours used to.”
Reardon points out that cycling is generally more inclusive of a company’s staff, too. “You might find that 10-20% of a company can actually play golf, while 70-80% are willing to do some kind of cycling, as it is perceived to be more accessible and less intimidating.”
Continue reading: http://www.moneyweb.co.za/moneyweb-business-of-sport/cycling-is-the-new-golf
