Human Resource & Workforce Analysis Report for the Private Club Industry August 17, 2017

Presentation Overview Club Benchmarking Mission Comments on Survey and Report Methodology What We Have Learned Executive Summary Overview of Human Resource Expense Overview of Payroll Taxes and Benefits Individual Position Benchmarks Discussion

Connecting each club and manager with the wisdom of the crowd Our Mission and Vision Healthier clubs, more empowered staff, and more strategic boards result by elevating fact over opinion Why Respectfully but passionately… How Connecting each club and manager with the wisdom of the crowd What The club industry’s single, standardized, centralized data-sharing platform

Comments on Survey and Report Methodology Benefits of new Compensation & Benefits Analysis The most up to data compensation ranges Year-over-year trend analysis in staffing, benefits and wages Strategic look at how staff are allocated throughout the club More transparent, easier to interpret information

Comments on Survey and Report Methodology Driving the Industry Forward Carmel Country Club is a high volume, fun, family oriented club …We were referred to this past weekend as the “Top Golf” of country clubs, fun, wild and innovative! We wanted to be able to have comparative data to keep us in line with hiring additional staff in time for our budgeting process. Standards and Service Committee Formed this year – Focused on Service and increasing “Wow” moment. Question came about what is the “Optimal Staffing” needed throughout the Club to be able to consistently provide excellent service. Department Heads to determine by position, by department how many employees they need to be able to provide consistently exceptional service. If approved by senior management their proposals will be submitted with their budgets for approval by finance committee and board for 2018.   The goal is to answer the question “Is Carmel CC staffed at a level that balances the club’s financial results and the members service expectations?” That is what Ray & his team they have set out to do…

Changing the Dialogue: A Common Framework CAGR 8.7% CAGR -3.9% Carmel has invested heavily over the last ten years. Their Net Worth (Member’s Equity) has increased at a Compounded Annual Growth Rate of 8.7% - very close to the top of the industry Their Initiation Fee has increased consistently over that period.

Changing the Dialogue: A Common Framework CAGR 25th = -1% Median = 2% 75th = 5% Google Equity 5 Yr. 18% Walmart Equity -.3% Top Club = 11.6% Can only increase Net Worth with significant Capital Income Carmel CC Club XYZ ----------

Comments on Survey and Report Methodology This report provides a comprehensive analysis of 2016 staffing allocation and payroll expense for Carmel Country Club Answering the question… “Is Carmel Country Club staffed at a level that balances the club’s financial results and the members’ service expectations?” Peer set comparison of payroll and benefits This preliminary analysis benchmarks Carmel Country Club against the 85 clubs that have submitted payroll reports in 2016 and 2017.

Comments on Survey and Report Methodology Mapping Payroll Reports 13 Standard Departments 155 Standard Positions 4 Standard Employment Statuses Org chart Salary hourly hybrid

Executive Summary The club’s total operating revenue in 2016 was $18,673,265 falling at the 83rd percentile in the comparative set. Total Operating Revenue for Golf Clubs that submitted a payroll report (85 Clubs)

Executive Summary Total Payroll includes all salaries, wages, payroll taxes and benefits. The total salaries & wages expense for Carmel Country Club falls at the 79th percentile. The total payroll taxes and benefits expense for Carmel Country Club falls slightly lower at 75th percentile.   Total Operating Revenue for Golf Clubs that submitted a payroll report (85 Clubs)

Executive Summary The payroll to operating revenue ratio is a critical Key Performance Indicator (KPI). The median payroll to revenue ratio for the industry is 56%. Payroll is the largest single expense in a club. The median payroll ratio for this peer set is 56% The payroll ratio for Carmel was 53% in 2016. There is a correlation between the payroll ratio and operating results – clubs with lower ratios tend to generate operating surpluses while those with higher ratios tend to generate operating deficits. Operating Result (Median) $258,000 $134,000 ($150,000)

Overview of Human Resource Expense in Clubs Peak employee count is the highest number of employees on staff during the year. Carmel’s peak employee count is at the 73rd percentile indicative of headcount falling in line with the club’s revenue.

Overview of Human Resource Expense in Clubs Carmel’s cost per full time equivalent employee falls nearly at the 25th percentile. Full Time Equivalents = total number of hours worked divided by 2080 which is the number of hours in 52 40-hour workweeks. New graph

Payroll to Salary & Wages vs. Payroll Taxes & Benefits to the Peer Set Overview of Human Resource Expense in Clubs Payroll to Salary & Wages vs. Payroll Taxes & Benefits to the Peer Set Payroll to Salary & Wages vs. Payroll Taxes & Benefits to Clubs with Golf The slope of the lines indicates that the ratio does not vary significantly across the industry.

Overview of Human Resource Expense in Clubs The breakdown of Carmel’s labor expense by department for the most part is in line with the allocation of labor expense in this peer set. Note that some clubs in the peer set operate yachting operations and/or guest rooms.

Overview of Human Resource Expense in Clubs Departments not represented in this peer set include: Youth Services, Yachting, Spa and Other.

Overview of Human Resource Expense in Clubs

Overview of Human Resource Expense in Clubs

Overview of Human Resource Expense in Clubs

Overview of Human Resource Expense in Clubs

Overview of Payroll Taxes and Benefits

Overview of Payroll Taxes and Benefits Carmel’s healthcare insurance expense is $3,224 per full time equivalent employee (27th percentile). The mid-range expense for the comparative set is between $3,201 (25th percentile) and $5,551 (75th percentile) per full time equivalent employee.

Overview of Payroll Taxes and Benefits In this peer set, total healthcare expense as a percentage of the club’s total payroll ranges from 3% to 11%. At the midrange for this peer set, there is less variation, with half the clubs investing between 5% and 7% of their total payroll for healthcare insurance. Carmel is in the mid-range at 6% (44th percentile).

Overview of Payroll Taxes and Benefits 100% of the clubs in the peer set offer 401k to their employees Carmel Country Club

Overview of Payroll Taxes and Benefits Carmel Country Club

Overview of Payroll Taxes and Benefits Carmel Country Club

Overview of Payroll Taxes and Benefits Payroll ratio 53% Payroll ratio 56% The club’s executive team includes: - Head of Club - Head of Finance - Executive Chef - Head of Food & Beverage - Head of Golf - Head of Greens & Grounds - Head of Tennis - Human Resources Director - Membership Director - Head of Fitness - Director of Communication/Marketing

Background Benchmarks   Assistant Golf Pro Compensation and Benefits My Club's Range Background Benchmarks % Reporting Given Perk Metric Low Median High 10th Percentile 25th Percentile 75th Percentile 90th Percentile Base Pay Hourly Base Range $11 $13 $16 $18 $23 57% Salary Base Range $50,000 (100th) $22,880 $25,550 $33,280 $36,770 $47,840 43% Effective Rate 24 (78th) $14 $31 100% Bonuses Performance Bonus % 3% 5% 20% Performance Bonus $ $1,500 (57th) $345 $500 $750 $1,375 $4,900 14% Holiday Bonus $ $100 $269 $489 $704 $975 56% Variable Pay Commissions/Lesson Income $109,391(100) $315 $1,061 $7,077 $13,610 $24,675 Gratuities 0% Auto Allowance Clothing Allowance Competitive Dining Allowance Education Allowance 1500 (65th) $324 $509 $1,000 $1,750 $2,300 8% Housing Allowance Other Allowance $3,000 Benefits Clubs Total Contribution to 457b Clubs Total Contribution to 457f $1,000 (5th) $4,800 $6,000 $8,000 $10,925 $12,680 15% $ Value of Life Insurance Plan $20,000 $25,000 $30,000 $49,429 $50,000 Total Compensation Assistant Golf Pro Demographics Number of Respondents 20   FLSA Status 35% Exempt 65% Non-Exempt Hire Status Year Round Full Time 0% Year Round Part Time Seasonal-Full Time Seasonal-Part Time Other

Background Benchmarks   Executive Chef Compensation and Benefits My Club's Range Background Benchmarks % Reporting Given Perk Metric Low Median High 10th Percentile 25th Percentile 75th Percentile 90th Percentile Base Pay Hourly Base Range Salary Base Range $118,114 (24th) $86,156 $120,773 $147,351 $169,120 $204,971 100% Effective Rate $204,941 Bonuses Performance Bonus % 3% 5% 10% 45% Performance Bonus $ $9,500 (19th) $5,819 $10,000 $13,206 $18,333 $24,227 77% Holiday Bonus $ $462 $671 $930 $2,225 $4,460 55% Variable Pay Commissions/Lesson Income 0% Gratuities Auto Allowance $3,300  $3,750 $4,500 $5,250 $5,700 9% Clothing Allowance $1,000  $1,000 Competitive Dining Allowance $775  $1,150 $1,750 $2,500 $3,700 36% Education Allowance $5,000 (20th) $4,000 $5,000 27% Housing Allowance Other Allowance Benefits Clubs Total Contribution to 457b Clubs Total Contribution to 457f $ Value of Life Insurance Plan $32,000 $87,500 $137,500 $224,063 $483,225 Total Compensation  $132,614 (24th)  $86,561 $133,423 $161,908 $193,194 $220,931 Executive Chef Demographics Number of Respondents 22   FLSA Status 100% Exempt 0% Non-Exempt Hire Status Year Round Full Time Year Round Part Time Seasonal-Full Time Seasonal-Part Time Other

Individual Hourly Position Benchmarks * 2016 range in peer set of clubs more than $15 million in revenue (20 Clubs)