Driving Range Business Overview

Driving ranges allow golfers to practice their swing without playing an entire game of golf. These ranges typically have markers designating different distances, allowing golfers to monitor their progress. While traditional ranges remain popular, many facilities are adding technology like ball tracking systems and virtual simulations that attract both serious golfers and casual visitors.

This evolution has proven effective in drawing younger adults (18-34) who view golf as both a mental wellness activity and a social experience. By blending practice with entertainment elements, ranges create environments where various skill levels can enjoy the facility simultaneously.

To maximize year-round usage, many driving ranges offer indoor options with simulators and climate-controlled hitting areas. These technologies enable practice regardless of weather, creating steady revenue streams during traditionally slow seasons while expanding the facility’s appeal beyond warm-weather months.

These facilities require substantial land, typically 10-15 acres, which brings a substantial cost to accommodate multiple hitting bays, target greens, and distance markers up to 300 yards. Most operate with both covered and uncovered hitting stations arranged in a line or tiered formation, with lighting systems that enable extended operating hours into the evening.

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How Do Driving Ranges Make Money?

The core revenue stream for driving ranges comes from selling practice balls, with prices typically structured in tiers based on bucket sizes. Customers pay for these buckets (usually containing 30-100 balls) and receive access to a hitting bay for a designated time period. Many ranges use automated ball dispensing systems and reloadable cards or tokens for convenient distribution. During peak hours, particularly evenings and weekends, ranges generate significant income from high customer turnover at their hitting stations.

Driving ranges can also generate additional revenue through multiple channels, including:

Practice Memberships: Monthly or annual subscriptions give regular customers unlimited or discounted access to hitting bays and practice balls. These memberships create predictable revenue streams throughout the year while fostering customer loyalty. Typical membership fees range from $50 to $150 per month, depending on included benefits.

Professional Instruction: Golf lessons are another income source for many facilities. Ranges can either employ instructors directly or arrange revenue-sharing agreements with golf professionals. Individual and group lesson packages, clinics, and specialized training programs all contribute to this revenue stream.

Pro Shop Sales: Most driving ranges operate small retail areas selling golf equipment and apparel. These shops provide convenient access to essential items like balls, tees, and gloves that players often need during practice, as well as a selection of clubs, shoes, and branded merchandise that generate additional revenue beyond the core ball and bay rental business.

Food and Beverage: On-site refreshment options ranging from simple vending machines to full-service restaurants can significantly increase per-customer spending while extending visit duration. Many ranges find that food and beverage sales contribute 20-30% of their total revenue.

Advertising and Sponsorships: Local businesses can be sold advertising space on range equipment, target greens, distance markers, and other facility spaces. Some ranges even sell advertising space on range balls themselves, offsetting the cost of ball replacement.

Event Hosting: Private events, corporate outings, leagues, and tournaments can create additional revenue streams while building community around the facility. Many ranges dedicate specific hours or areas to these group activities.

Industry Statistics

Golf driving ranges operate under NAICS code 713990: Other Amusement and Recreation Industries. These businesses offer recreational sports facilities focused on golf practice and skill development.

Here are some notable statistics about the driving range industry:

Driving Range Industry Size & Growth: The industry has grown by 6.4% annually over the last five years to generate $2 billion last year. Growth projections remain positive, supported by increasing recreational spending and rising golf participation rates. Also, the introduction of new technologies like digital ball tracking has attracted both experienced golfers and newcomers to these facilities. (Golf Range Association)

Number of Driving Ranges: There are 3,500 driving range businesses operating nationwide. Technology-focused operators like Topgolf have transformed traditional driving ranges by incorporating entertainment elements alongside practice facilities. While large chains have expanded their presence, independent operators still make up the majority of driving range facilities. (Golf Range Association)

Driving Range Profit Margin: Profit margins for driving ranges average 18.1% after accounting for operating expenses, labor costs, and facility maintenance. (IRS)

Also See: Ideas for Naming a Driving Range

Costs To Start a Driving Range

When starting a driving range, expect the startup cost to be between $250,000 and $2 million. This wide range reflects variations in property size, location, technology integration, and overall facility concept.

Here are some of the major expenses involved in opening a driving range:

Land and Site Preparation: A driving range requires 10-15 acres of relatively flat land. Land costs vary significantly by location, and rural areas might cost $5,000-$15,000 per acre, while suburban areas could range from $25,000-$100,000 per acre, and prime urban locations even higher. For a 15-acre plot, this could put land costs between $75,000 and $1.5 million, depending on location. Site preparation, including grading, drainage systems, and creating target areas, adds approximately $50,000-$150,000 to these costs.

Facility Construction: Building costs for covered hitting bays, equipment storage, and basic customer amenities typically range from $100,000 to $500,000. This includes electrical systems for lighting and climate control in covered areas. Construction costs vary based on materials used, the number of hitting stations, and the overall quality of finishes.

Equipment and Technology: Initial equipment purchases include:

• Range balls (10,000-20,000): $5,000-$10,000
• Ball dispensers/machines: $15,000-$40,000
• Mats, tees, and dividers: $10,000-$30,000
• Target greens and distance markers: $5,000-$15,000
• Maintenance equipment: $15,000-$40,000
• Basic technology: $10,000-$30,000
• Advanced ball tracking systems (optional): $75,000-$200,000

Safety Features: Protective netting, fencing, and barriers are required to contain balls within the facility and protect customers. These safety installations generally cost between $30,000 and $100,000, depending on the size of the facility and quality of materials.

Additional Revenue Sources: Many successful driving ranges invest in supplementary amenities such as:

• Pro shop (initial inventory and fixtures): $25,000-$75,000
• Food and beverage service (basic setup): $40,000-$150,000
• Indoor simulator bays (per bay): $15,000-$50,000

Business Startup Costs: Legal fees (business formation, contracts, permits): $2,000-$5,000; initial marketing and advertising: $3,000-$7,000; business licenses and insurance: $1,500-$3,000; accounting setup and POS systems: $1,500-$5,000.

The total investment varies significantly based on your business model:

• Basic Traditional Range: A no-frills outdoor driving range with minimal covered areas and basic amenities can be established for approximately $200,000-$350,000, assuming moderately priced land. This model focuses on the core driving range experience without significant additional revenue streams.
• Mid-Range Facility with Basic Technology: A range with covered bays, modest technology integration (such as simple ball tracking), and small-scale amenities like a basic pro shop typically costs $350,000-$750,000. This model balances traditional range operations with some modern features.
• Advanced Technology-Enhanced Facility: A modern driving range with multiple covered and heated bays, comprehensive ball tracking technology, quality amenities, and expanded supplementary services costs approximately $750,000-$1.5 million.
• Premium Entertainment Concept: Upscale facilities with extensive technology integration, full-service restaurants, multiple revenue streams, and premium locations require investments starting around $1.5 million and can reach much higher depending on scale and location.

Is a Driving Range a Good Business to Start?

If you’re thinking about opening a driving range, it’s helpful to understand both the advantages and challenges of this business. Let’s take a close look at five important aspects of running a driving range to help you decide if this might be the right business for you.

Durability (Grade: B)

Driving ranges tend to perform relatively well across economic cycles, as they offer an affordable alternative to full golf courses. While economic downturns may reduce disposable income, many golfers will choose a driving range visit over more expensive leisure activities. The business faces some technology disruption risk from virtual golf simulators, but traditional outdoor ranges maintain appeal through their authentic practice environment. Established ranges with good locations can build strong customer loyalty, though they remain vulnerable to new competitors with premium amenities or better locations, or other forms of entertainment. The ability to adapt to market changes presents both opportunities and challenges, particularly as ranges increasingly blend practice with entertainment.

Revenue & Profit Potential (Grade: C-)

Driving ranges face pronounced seasonal challenges, with most generating 70-80% of annual revenue during just 5-6 months of favorable weather. This creates significant cash flow pressure, as fixed costs for land, equipment, and maintenance continue year-round while income fluctuates dramatically. The business typically requires 2-3 years to achieve consistent profitability, with faster timelines only in year-round climates or dense urban markets. Facilities can offset some of these challenges through heated bays and indoor simulators, in addition to diversified revenue streams, such as instruction, retail, food service, and memberships.

Execution Complexity (Grade: C)

Opening a driving range demands substantial upfront capital, primarily for land acquisition and development. The business requires various permits related to zoning, construction, and sometimes environmental considerations. Supply chain challenges are relatively minimal once established, focusing mainly on ball replacement and equipment maintenance. Staffing needs are moderate, with most ranges operating efficiently with a small team of employees handling customer service, maintenance, and possibly instruction. The regulatory burden varies by location but generally includes standard business compliance plus specific considerations for safety, lighting, and sometimes noise restrictions.

Available Market (Grade: B-)

The golf market continues to show steady growth, with particular strength in the “off-course” segment that includes driving ranges. Competition varies dramatically by region as urban areas often have established facilities but higher customer density, while rural areas may have less competition but smaller population bases. The problem a driving range solves (providing convenient golf practice) has moderate urgency for dedicated golfers but less so for casual players. Customer willingness to pay depends largely on quality, convenience, and added amenities, with premium facilities able to command significantly higher rates than basic operations.

Maximum Growth Potential (Grade: C+)

Driving ranges face inherent scalability limitations, as each facility serves a geographic radius and cannot easily expand beyond local capacity. While multi-location growth is possible, each new facility requires substantial capital investment. Geographic portability exists, but success is highly dependent on local golf culture, climate, and demographics. Expansion opportunities include adding technology features, indoor simulators, instruction programs, or complementary recreational activities like miniature golf or batting cages. Exit strategy options typically involve selling to larger golf facility operators or real estate developers interested in the land.

Here’s the updated overall grade section that reflects the revised assessment of seasonality:

Overall Grade: C+

A driving range business presents moderate potential with particular challenges related to seasonality. The business offers proven appeal to golf enthusiasts but requires significant initial investment and faces inherent growth limitations. The most critical factor to consider is the pronounced seasonality affecting cash flow and profitability, with most ranges generating the bulk of their revenue during a limited portion of the year. Success largely depends on securing an excellent location, developing weather mitigation strategies, and establishing multiple revenue streams beyond basic ball sales.

For those considering this business, thorough financial projections are absolutely necessary before proceeding. Develop detailed revenue projections that account for seasonal patterns, with month-by-month forecasts reflecting realistic customer traffic based on local climate data. Create multiple financial scenarios (best-case, expected-case, worst-case) to understand the full range of possible outcomes.

Resources:
American Junior Golf Association
Ladies Professional Golf Association
United States Golf Association