Financial Management

MLSN @ Nikanti GC. Reducing Expenses and Inputs Since 2016

Is it possible to reduce fertiliser expenses by 69%? I certainly wouldn't have thought so 2 years ago. I used to dig my heels in a little at monthly P&L meetings when management would ask to reduce our expenses, but once I started to embrace it as a challenge, it was like new motivation! To maintain our surfaces at the same high standard or better, for a fraction of the price. 

In my previous post regarding Phosphorus and our use of the MLSN guidelines, I mentioned that apart from the improvements in turf performance, we have seen some positive results on the bottom line and that is what I would like to share with you now.

While the MLSN Guidelines have played a major role in reducing our expenses, they can't take all the credit. There is another major change we made that shares equal weight with our decision to follow the MLSN and that is to use only soluble fertiliser compounds. We no longer use any liquid or slow release granular fertilisers as part of our normal fertility program across all of our surfaces and in doing so, have seen huge savings. Now, I should clarify and say that we do still use a liquid and granular humic acid product on our greens with great results, but apart from that, everything else is a soluble compound fertiliser.

As this post is mainly about sharing some positive consequences after following the MLSN Guidelines, I will perhaps write another post further expanding on our use of soluble fertilisers. For now, I will leave you with this great article from the team at the Green Section Record titled "Does the Grass Know the Cost?"

Figures shown are for greens only. P and K figures are displayed as elemental P and K and not P2O5 and K2O.

Figures shown are for greens only. P and K figures are displayed as elemental P and K and not P2O5 and K2O.

The above graph illustrates what may be some typical results after following the MLSN guidelines. These figures will vary from course to course depending on what nutrient reserves are currently in the soil but I am sure that anyone who begins following the guidelines will report a reduction in fertiliser application. I do apologise for not having our application figures for 2015 but they were lost during a transition to a new computer, however I do remember that they were only slightly higher than the 2016 figures.

Some of you may comment that the N:K ratio is not correct and we are not supplying enough K, this is due to the fact that we had enough K in the soil reserve at the start of the year and in fact applied zero K for some time. We now apply K regularly as the grass requires in a ratio of 1:0.7 for Bermuda and 1:1 for Paspalum.

My goal when first starting to follow the MLSN Guidelines was to reduce the soil reserve of each element to the MLSN value and observe the results. I have since done so with the elements above except for Calcium, as there is a large soil reserve and Magnesium, as this is ever present in our water supply in high amounts. I have not seen any detrimental results thus far as a direct result of following the MLSN Guidelines. I have only seen positives.

So, is it possible to reduce your fertiliser budget by 69%?

Figures converted to US Dollars from Thai Baht at a rate of 34 Thai Baht to US$1.00

Figures converted to US Dollars from Thai Baht at a rate of 34 Thai Baht to US$1.00

We are still a long way from the minimalists of the world like Jason Haines and the results they are achieving. Check out his writings on his experiences and results following the MLSN Guidelines and the results that can be achieved.

But again, each course and their circumstances are different and I hope this can provide some motivation/inspiration or at the very least, something to think about the next time your preparing your budget, fertility program or being asked to reduce expenses.

Using ROI to Justify That Project or New Machine

If you're like me and have found it quite difficult to get approval for a new machine you really need or that project that is always getting shoved down the list, try using a ROI (return on investment) figure as a tool and it may just get you over the line.

This may be relatively new or unheard of for some or a regular tool in the arsenal for others, but it has helped me recently with a few new projects we were planning as well as some machinery purchases so I thought I would share a few things I have learnt that you may find useful too.

I will use the new machinery purchase as my first example as it is relatively clear to see. Last year we trialled a new implement on our fairways in the hope that if it passed all of our tests it would then replace our fairway topdressing program. Well, it passed our tests but now I had to show the club management why it would be a worthwhile investment.

Now for some facts. Traditionally we topdress our fairways annually which costs around 300,000 Thai Baht (approx. US$8,570) and the new machine in question costs 950,000 Thai Baht (US$27,140). Now simply map out those costs and savings in a table over time as pictured below.

ROI = (Net Profit / Cost of Investment) x 100

ROI = (Net Profit / Cost of Investment) x 100

This is just a simplified version, you can be as detailed as you want with the costs and include estimated fuel usage, maintenance costs and any changes in the price of materials or just keep it simple like I have. 

Another example is a project we are currently looking into and involves changing the grass type on our course to one that is better suited to our location and site specific circumstances. The project would take approximately 2 years completing 9 holes each year and so any potential savings wouldn't be realised until the second year as shown below.

You can also calculate Net Present Value and Internal Rate of Return and add them to your presentation to further assist in the decision making. There are many helpful calculators available online free of charge and are quite simple to use. If you are looking for more information on ROI I have found this site to be quite helpful.

This was a slightly different blog from what I usually write about but I hope it was helpful all the same! 

Stay tuned for a new Vlog of our course renovation practices!