If you’ve ever Googled how to run a golf simulator, questions like which sim should I use, how many bays should I have, and how much does it cost to build out a facility litter online forums.
Yet all these “build” questions are really asking for an answer to something much broader: how can I run a profitable golf simulator business?
Countless sim owners have shared their revenue models with me firsthand, and what I’ve realized is that the build questions should actually come downstream of the profit question.
Why? Because golf simulator profitability is dependent on operating decisions, while the build’s actual job is to make the operating levers work.
The nature of the business: three obstacles that cap profitability
Take this as an example: two facilities, both cost the same amount to build, and each has 5 bays and the same kind of sims. One decides to run with a flat hourly rate, noon to 9 p.m. The second pulls every revenue lever that follows, and earns drastically more than the first.
Both face the same three obstacles below. One is simply more profitable because they played their cards right.
Obstacle #1: Fixed costs, very few variable costs
Like any business, golf simulators have fixed costs like buildout, rent, equipment, and insurance. There’s no way around these.
Interestingly, it’s this exact reason that opening a golf sim is so enticing—overhead rarely fluctuates, meaning that as long as you cover all your fixed costs, each additional booking is nearly all profit since it basically costs nothing to fill another booking.
On the flip side, expenses don’t decrease, even in a slow month, so you can’t cut costs as a way to regain profitability.
Obstacle #2: Capacity is hard-capped
Golf sims have a set number of bays available, and when one is booked out for a specific period of time, no one else can book it. So if you run 5 bays, 9 hours a day, you have exactly 45 bay-hours of inventory available for purchase per day—no more, no less.
This is entirely different from businesses like restaurants that can ask their staff to turn tables more quickly, or gyms that can sell more memberships than there are treadmills available.
Growth for golf sims can’t come from more people using the facility, only from hours available or from revenue per bay-hour.
Obstacle #3: There’s a narrow window of demand
For golf sims, demand is concentrated in a few distinct timeframes. Evenings and weekends are usually busiest and weekdays are slower. The problem? Most people only want to book during peak times, and slower hours are the ones people won’t pay a peak rate for.
Unfortunately, you can’t add more times when sims are in demand. Inventory is fixed, and most of it falls outside the hours people want.
How to make profit as a golf simulator
Factor in these three constraints, and profitability as it stands is extremely limited. The four levers below are what stand between you and a successful business.
Revenue lever #1: Make your closed hours available, especially overnight
Your first reaction to this might be: “In theory, yes, that makes sense, but how can I be sure that there’s enough demand for overnight play time to make the return on investment worth it?”
After talking to operators like Golf630 who run completely unmanned, 24/7, I’ve learned that the right crowd, like college students, will book sims during off-hours. Those hours arrive on top of rent and equipment you’re already paying for, so opening yourself up to maximize bookings automatically positions you to earn more.
The next thing you’re probably wondering is, “OK, sounds great, but how can I operate 24/7 without driving up overhead?” The answer is through automation. With the right integrations in place, you don’t need to add hours to payroll. Technology has advanced so far that things like smart locks, smart thermostats, and security systems can run your facility without anyone being there. See what this looks like in practice.
Revenue lever #2: Charge bays based on demand
Charging the same price for hours that don’t have the same demand caps profit potential and is an easy mistake to correct. Raise your prices for peak times, and slightly discount rates for off-peak.
A Saturday night that’s always full is the market telling you that the price you’re charging is too low. Even though utilization decreases slightly, you bring in considerably more revenue than you were before because you dictate it.
The second piece of the puzzle is properly pricing off-peak hours. There’s demand for those times, but playing on a Tuesday at 2 p.m. isn’t the most ideal time for your golfers, so they won’t pay a peak rate for it. Decrease the price for those hours, and you can lift utilization.
On top of that, I recommend pricing by bay, not just by hour. These are your two variables to manipulate, and I suggest doing exactly that if you have different bay amenities or sizes that could warrant different prices.
Revenue lever #3: Offer both hourly bookings and memberships
Unpredictable revenue is exactly what keeps operators up at night, and offering Memberships alongside hourly bookings is the fix—as long as you structure your tiers correctly.
Take Golf630’s approach: offer a low-cost entry tier that locks in casual players for recurring revenue, and makes them more likely to upgrade to a higher tier later on. Members tend to play more than they did as walk-ins, and most of their play time happens in hours that would have been challenging to sell anyway.
The challenge? Someone on a membership could occupy one of your most profitable peak hours and stifle revenue that could have come in from an hourly booking. The key here is to structure membership perks to guide utilization toward off-peak hours by setting booking limits, hourly time frames for bookings, and duration limits.
Revenue lever #4: Sell more than just bay time
This one is obvious. The more goods you sell, the more revenue potential you have. Offer add-ons to your customers, like club rentals, fittings, and food and beverage, to maximize earning potential.
The key here is to put all four of these levers to work at the same time. Combined, they help you sell hours you weren’t selling, earn more from what’s available, secure recurring revenue, and make every booking worth more. To see how AllBooked can help your facility drive revenue, click the button below.
