I must admit I am perplexed and looking for logic. The chatter down our way these past weeks has been about price increases from airlines, hotels and restaurants. Many sad contributors to the debate saying they can’t afford to holiday in the Soller Valley anymore as it has priced itself out of their reach. These were largely friends used to frequent travels and high spending. This year everything came under their scrutiny from self-catering apartments to luxury villas. The price rises were just too high.
Against that came example after example where this wasn’t the case. One person following the thread sent me his receipts for his flight and car hire for March 2023, coming in at half the price of last year. Others told me of Villas and Hotels who have imposed an energy surcharge but left all basic prices the same. The Tour Operators will all tell you what they are doing to preserve family summer holidays. They make it easy to pay by instalments and initial large deposits seem to be a thing of the past. This is not a one size fits all problem. There are two sides to this story.
The coffee debate is a good yardstick measure every year. 1.80 to 2.50 seems to be the going rate this year in Soller and in Palma. Surprisingly these prices all seem cheap to those from the UK and most Scandinavian countries. They don’t really understand our gripe when the price hits 2.50.
When tourism was young, travellers got used to their currency going a long way, because everything about Spain was deemed ‘cheap’. This included the labour costs and salaries which were sometimes even paid in black money. The tourist in those days enjoyed the price differentials and kept returning for more. They couldn’t holiday in their own country for the little they were paying in Spain. Those days are thankfully gone, and minimum wages and legislation has helped the salaries in Spain to climb. It will take years for the older tourist to shake off the notion that Spain ‘should be cheap’. That just doesn’t work anymore with rental and food costs in the Balearics on a par with London. How can Spain be cheap?
Businesses sit down with the spreadsheet and work out the costs of raw materials, rent of premises, energy costs and staff costs, then out of this comes the price necessary to charge the customer. When this exercise is done, they look at ways they can cut costs to make the end price, more acceptable. For some local friends they have decided to close their restaurants and open a ‘Take Away’ instead. Getting rid of staff costs is the only way they see of balancing the books. Others choose to go so ‘high end’ that it is only the super-rich who can afford to eat with them.
There are only a few more weeks left for the talking. The Soller Valley has a 10 month season and it’s just started. Half terms fill the second half of February and then the March walkers and cyclists will see us into Easter. All the calculations talked about are almost done now and the price lists sent to the printers.
I will be fascinated as people arrive and tell the stories of how much they have paid and what their experience has been. Restaurants and Hotels who struggled last year finding staff can no longer use that as an excuse for mediocre service this year. I know of many companies who are in staff training mode and looking to provide increased excellence for the increased prices they will charge in 2023.
We start the year with there being two sides to every story, and so it will be at the end. I really don’t want to say goodbye to old friends and hope, by shopping around, they will still find prices in the Soller Valley which work for them. The chatter will be very interesting that’s for sure.