strategic-management

public and private golf clubs are experiencing weak demand and have been lowering prices
to attract customers. According to Golf Datatech, golf equipment is selling but at lower
prices. A few golf companies have declared bankruptcy, including San Diego–based
Carbite Inc., a wedge and putter maker. Some equipment manufacturers, including Planobased
Adams Golf Inc., are struggling as well, and CGC itself laid off 370 employees
in 2008 to improve its manufacturing efficiencies and effectiveness as well as reduce
operating costs.
The global economic recession hurts Callaway. Golf products are discretionary
rather than essential items. Other factors that also harm the golf business include high
unemployment, increased consumer debt levels, and declining consumer confidence and
spending. Other threats to Callaway include imitation clubs, limited growth opportunity in
golf clubs and golf balls, intense competition, international exchange rate fluctuations,
international political instability and terrorist attacks, natural disasters and pandemic
diseases, and the seasonality nature of the sport.
CASE 28 • CALLAWAY GOLF COMPANY — 2009 281