Just a few mid-week notes, with a particular focus on the events of last week surrounding Golfsmith’s filing for Chapter 11 and the sale of Golf Town … Golf Town has $140,877,754 Cdn. reportedly owing to creditors, $95,860,201 of it to secured creditors and $45,017,553 to unsecured creditors such as equipment manufacturers, apparel companies and other golf businesses … A claims procedure and process has not been approved yet, but Golf Town has assured suppliers that, as things shake out, it will play for goods and services going forward, even if it isn’t in a position to settle obligations prior to Sept. 14 … This week’s GNN Poll asks if Golfsmith filing for Chapter 11 in the U.S. and the sale of Golf Town in Canada does anything to Golf Town’s stature as a major golf retailer going forward. As of this writing, 51 per cent of respondents said yes and 49 per cent said no. There’s still time to cast your vote on the GNN home page … Golf Town is eventually expected to close about 15 stores in Canada and Mike Stachura of Golf Digest reports here that Golfsmith will close 20 stores before the end of October … While I’m sure there are exceptions, most companies I’ve chatted with are confident they can absorb whatever hit they take, but it won’t be easy, which means there will be a ripple effect with less money in the market over the winter months. It should be interesting to observe the mood of the industry at the PGA Merchandise Show in Orlando in January … If they can ever get past blaming it on the “golf is dying” theme presented in the media, government officials at various levels may want to look at the Golfsmith/Golf Town debacle as an example of what can happen when you try to grow too big, too fast and build up a mountain of debt with high financing costs in pursuit of that goal.
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