Golf Ball Profit Margins

[PlusFours]

Just curious

I've been wondering for some time what the profit margins on golf balls are. Since I have joined GolfWRX I've observed that there are a number of members with industry experience, and I'm hoping you will be able to answer my question.

Thanks!

[slim16er]

I can tell you that it's almost nothing on the ProVs

[twgolf]

When I used to work in the pro shop at our local course the wholesale price for PROV1s was $36 and the Nike One was $32 a dozen, but that was a little over a year ago. There's not much mark up in balls, in fact these were the ones that had the biggest margins. As you can see at about $7-$9 a dozen mark up you are not going to make living off of them unless you sell TONS of them.

[Scratch2Plus]

just got the 08' TM TP Red LDP for $33/dozen + tax of course.

[Gxgolfer]

I hear there's a facility in Oceanside that was built by a ball company. :cheesy: And Callaway bought a company for its ball production capacity.

[PlusFours]

When I used to work in the pro shop at our local course the wholesale price for PROV1s was $36 and the Nike One was $32 a dozen, but that was a little over a year ago. There's not much mark up in balls, in fact these were the ones that had the biggest margins. As you can see at about $7-$9 a dozen mark up you are not going to make living off of them unless you sell TONS of them.

 

Thank you for the information! Any idea what the mark-up on the cheaper balls was/is? Maybe the Bridgestone e5/6, NXT series, Pinnacle Exception, etc. (just examples). I'm not asking for information on every single ball sold, just curious about the spread between the cheaper balls and the more expensive ones.

 

Thanks again.

[PlusFours]

I hear there's a facility in Oceanside that was built by a ball company. :cheesy: And Callaway bought a company for its ball production capacity.

 

So I hear. I'd like to go check it out, but can't afford the entrance fee.

 

:cheesy:

[mantan]

But the margin for the ball manufacturers has to be ludicrous!!! Wasn't it rumored that Titleist makes the majority of it's profit from ball sales, not equipment?? The wholesalers are paying a premium, but the company has to be making a mint!

[themouth1]

But the margin for the ball manufacturers has to be ludicrous!!! Wasn't it rumored that Titleist makes the majority of it's profit from ball sales, not equipment?? The wholesalers are paying a premium, but the company has to be making a mint!

 

YEP...

[HarboursideTC]

It is pretty safe to assume that the average pro shop is getting a $6-8 dozen profit on premium balls and $4-6 dozen on midrange balls. In other words, not much left to raise a family on.

[mr.beasley]

we're lucky if we get 6-8... our staff price on the pro v's(cost +5%) up until the canadian dollar made its move worked out to a dollar less than the consumer was paying, lol. some companies do have higher margins, ie srixon...

[bulldog8b]

Wow, $35 or so a dozen? I wonder what it costs Titleist to make 1 ProV1? I seriously doubt it's anywhere near $3. And I don't want to hear anything about R&D costs, they are golf balls, not cancer drugs!! It's highway robbery I tells ya!!!

[BluesDrive]

I can tell you that the resale value of a ProV1 or V1x is incredibly ridiculous. I've decided to play golf at my local course a lot more and hunt for lost V1's when I shoot a ball in the rough. I may just bring a fishing pole with a net or something of the sort attached to it and go fishing.

[Sean2]

I was told by a Titleist employee that the out-the-door cost for the ProV1 is $4 a dozen.

[Shaitan]

yeah its pretty bad - let's just say i don't get payed very well if i sell a heap of balls lol

[JORDANF1]

I was told by a Titleist employee that the out-the-door cost for the ProV1 is $4 a dozen.

 

 

Down here in OZ , PROv1 's are nearly 80 bucks a dozen , and ive heard thru a gold shop that ProV's generate their profits more so that clubs

[Shaitan]

Nah, not in our golf shop mate - shoes and clothing have the biggest profit margin, and balls and mizuno stuff has the smallest. We are selling the ProVs at $73, and the cost isn't much less then that.

[BluesDrive]

the profit margin for pro shops isn't that interesting for balls. What I really wonder about is how much titleist makes.

[BEND OF THE RIVER GC]

A close friend of mine is an engineer who, while working on his masters at MIT, co-op'ed at Titleist.

 

Not sure on the margin, BUT he said that the all of the packaging for a dozen balls cost more than it cost to make the balls.

 

The ball companies are the ones making the profit off the bals, not the courses.

[dansrixon]

The profit margin on golf balls is like anything else....furnature, cars, TV's etc etc, the manufacturing cost are depressingly low. I promise you the manufacturing cost on a golf ball is probably less then you believe. The margins on golf balls are much stronger then that on clubs for any company, why do you think Callaway and Taylormade got into to golf ball business?

[Eye-O-Matic]

I totally agree.

Just like they say about gas and the small amount of profit, yet you have warehouse clubs and grocery chains now selling gas. If there's not much profit, then why would they go out on a limb.

[themouth1]

The profit margin on golf balls is like anything else....furnature, cars, TV's etc etc, the manufacturing cost are depressingly low. I promise you the manufacturing cost on a golf ball is probably less then you believe. The margins on golf balls are much stronger then that on clubs for any company, why do you think Callaway and Taylormade got into to golf ball business?

 

While I agree totally, I would like to add something. Most of the comments in this tread are related to margins at the retail level. Retailers are paying a premium to stock these things and make very little. The manufacturers are raking it in though...I love capitalism :russian_roulette:

[golfdad907]

Having worked for one of the world's largest rubber companies, who also makes balls, and remembering an article couple years back in Golf Digest, the cost to produce a 'tour' ball is less than ten a dozen. BUT, consider packaging, marketing and R&D costs it goes up some, I'd guess reatils gross about 20% and manufacturers make the rest.

[j.a.]

[quote name='Sean2' timestamp='1208258027' post='1022034']
I was told by a Titleist employee that the out-the-door cost for the ProV1 is $4 a dozen.
[/quote]

That's why there are competitors that offer top of the range balls for up to 50% less than the ProVs.

[Fourmyle of Ceres]

Golf balls are very profitable for the manufacturers.

For the retailers, not so much. Markups are pretty low.

Same as any other manufactured consumer item nowadays. No profit left in retail outside of high-end specialty items in a few specific categories.

[dlygrisse]

[quote name='golfdad907' timestamp='1208563874' post='1028556']
Having worked for one of the world's largest rubber companies, who also makes balls, and remembering an article couple years back in Golf Digest, the cost to produce a 'tour' ball is less than ten a dozen. BUT, consider packaging, marketing and R&D costs it goes up some, I'd guess reatils gross about 20% and manufacturers make the rest.
[/quote]

This makes sense, the $4 a dozen is just the cost of goods, once you throw in all the cost it takes to run the factory, labor, insurance, electricity, marketing, R and M, etc. etc. etc. I would guess Titleist nets closer to 20% after all bills paid.

[Hot Rod 71]

I will echo what others have said here. I work in a pro shop and we make ~$8 per dozen on the Pro V1.

One thing to keep in mind when discussing golf ball profit is the cost of overhead and R&D for manufacturers. While it may only cost $4 to make a dozen Pro V1s, The countless hours of R&D and the cost of the machinery and maintenance in manufacturing plants can be quite expensive.

With that said, I think golf balls are way over priced. They could sell for $10 less per dozen and ball manufacturers would still make a healthy profit.

[gopherguts]

[quote name='Hot Rod 71' timestamp='1396787259' post='9030899']
I will echo what others have said here. I work in a pro shop and we make ~$8 per dozen on the Pro V1.

One thing to keep in mind when discussing golf ball profit is the cost of overhead and R&D for manufacturers. While it may only cost $4 to make a dozen Pro V1s, [size=5][b]The countless hours of R&D and the cost of the machinery and maintenance in manufacturing plants can be quite expensive.[/b][/quote][/size]

[size=5][b]Being you acknowledge the ABOVE,,,,,,,,,,[/b][/size]



[size=5][b]How on earth can you possibly say THIS ??? [/b][/size]


[quote]With that said, [size=5][b]I think golf balls are way over priced[/b][/size]. [size=5][b]They could sell for $10 less per dozen and ball manufacturers would still make a healthy profit.[/b][/size]
[/quote]

[Hot Rod 71]

You just come on here to pick apart posts and argue, don't you? Seems to be your m.o.......Sad, really.

My first statement you highlighted was an acknowledgement that there is a lot of overhead in the manufacturing process. But when golf balls cost $4 (per another member's post) to make and then sell for $40 a dozen, that's quite a mark-up.

I think golf ball manufacturers could still make a healthy profit at $30 per dozen, which is why I made the second statement.

But as long as golfers are willing to pay $50 per dozen at retail, then the price will only continue to climb.

Thank you for trolling. Have a nice day.

[ClayShooter]

[quote name='Hot Rod 71' timestamp='1396787259' post='9030899']
I will echo what others have said here. I work in a pro shop and we make ~$8 per dozen on the Pro V1.

One thing to keep in mind when discussing golf ball profit is the cost of overhead and R&D for manufacturers. While it may only cost $4 to make a dozen Pro V1s, The countless hours of R&D and the cost of the machinery and maintenance in manufacturing plants can be quite expensive.

With that said, I think golf balls are way over priced. They could sell for $10 less per dozen and ball manufacturers would still make a healthy profit.
[/quote]

Most everyone's numbers seem to be Gross numbers. I can tell you as a business owner,, if the shop si making $8 gross there are probably making $2 in net profit at most per dozen. It is simply amazing how much money gets eaten up in overhead just to sell that 1 dozen balls! Purchasing, Shipping, Receiving, Accounting, merchandizing, Sales, Cash Register, Packaging, Inventory, Accounting, Paying the Tax Man then you get to pay for your building, utilities, licensing, advertising, Insurances, Work Comp and that $8 bucks starts to llk like 50 Cents!