The rise of the empowered consumer
Sceenshot taken from X

The rise of the empowered consumer

In Southern Spain recently, news has spread about a restaurant in Granada called El Huertos de Juan Ranas with a view of the Alhambra from its terrace. Someone who had paid 54.80 euros for ten drinks at a terrace table posted his receipt on X with a comment indicating that he found having to pay eight euros for a San Miguel Corporation beer expensive.

THE RELATIVITY OF PRICING

As hospitality industry professionals -- as well as anyone pushing goods and services to consumers -- understand too well, price is relative and whether eight euros for a beer is excessive really depends on where one is in the food chain as well as on one's understanding of how a business is run.

I for one saw this bill and found it cheap for ten drinks in what looks like a decent establishment with a view, especially knowing Spain's rather high employment costs to businesses, the rise in electricity bills, and yet without any information on the additional expenses to proprietor Manuel del Castillo of acquiring or renting and then the upkeep of a prime real estate property.

UNLEASHING DAMAGE BY PHONE

Getting on social media these days is simply a matter of typing on a phone or a laptop for consumers. With such easy accessibility, this situation has created a breed of entitled individuals who feel power literally at their fingertips. When making public negative feedback, they either post without thinking or they post knowing fully well the impact such information will have on the place they have just patronized.

Unfortunately, in the case of the El Huertos de Juan Ranas, where the X post went viral and resulted in hundreds of derogatory remarks, not a few of the commenters seem to understand the equation of running a hospitality business. Instead, for them it is simply a comparison between the price of any food or drink item from a supermarket or their local bar -- or even what they might have done at home -- vs. the cost of consuming these items in an establishment.

TO STAY OR NOT TO STAY? THE EIGHT EURO QUESTION

Poor Mr. del Castillo has had to defend himself in the newspapers such as Diario IDEAL (Grupo Vocento) even if it is generally understood that businesses can charge what they wish for goods and services and consumers can accept these at the outset or not.

In Spanish, he said in one interview that "..in case someone thinks (these prices) are excessive they may choose not to enter the establishment." Fair enough.

He added: “Today (reviews are) published without mercy and people have the power to hurt you a lot and that is quite serious. I have a very clear conscience because I know that we do it very well and that we offer something unique."

CONSUMER FINDS THEIR POWER

Certain websites have actively encouraged customer reviews, providing a voice for consumers where previously there was none. While these websites indeed are usually very useful in assessing establishments, I hope intelligent readers can sift through reviews to identify legitimate feedback vs. poorly thought out or malicious ones. In other words, to determine the real from the rant.

Prices and experiences all depend on perception, after all, and not a few consumers have rated businesses poorly simply because they did not receive an upgrade, a discount or the late check-out they so wanted.


HOW MUCH IS TOO MUCH FOR A BEER?

Or in the case of the El Huertos de Juan Ranas, because of the approximately seven euros price differential between going to the supermarket and buying a beer for one's self and drinking beer in a terrace with a view of the Alhambra, rented or purchased by the proprietor for XX euros, and served by waitstaff on a generous employment package using glasses that will have to be washed and stored by other personnel on equal generous employment packages.

Not to mention the fractional cost of the glass, the table napkins, and even the table and chairs. Add the fractional cost of the Alhambra patterned tiles too, if they had these. As well as all the costs that go to maintaining the bathroom facilities.

THE CHALLENGES OF RUNNING A BUSINESS IN SPAIN

The expenses list is never-ending for a hospitality enterprise in a competitive environment, and I like to think that most business do not hang up a sign in order to dupe their guests. Moreover, the challenges faced by small establishments in Socialist-leaning Spain are infinite and an uncalled for review is the last thing they need.

I sincerely hope that the often used phrase "any news is good news" is true for this unfairly treated establishment. I for one had never heard of the El Huertos de Juan Ranas prior to this issue going viral. I intend to visit it on my next trip to Granada and order that eight euro beer.


Mark K

Biotech l Assets | Data | Energy

5 个月

Price looks reasonable. Decent beer in Singapore already cost 12 euro at Marina Bay Sands per pint

Fer Ledesma

Founder en Virgl

5 个月

I recently came across your article “How much is too much for a cold beer with a view?” and I must say, it resonates deeply with me. As an owner of one of the finest cafés in Spain, I find myself frequently navigating the turbulent waters of customer perceptions and reviews. In my own experience, I’ve found that such critiques, while often disheartening, are a crucial part of defining our niche market. They push us to continually decode Google Maps reviews, not just focus on the numerical ratings but understand the narrative behind them. This helps us refine our services and ensure that our loyal patrons feel valued and heard. Thank you for shedding light on this important topic. It’s a conversation that we, as industry professionals, must continue to engage in to educate consumers and improve our standards.

Roberto Pelliccia

Hospitality | Asset Management | Business Development | Operations | Service & Operational Excellence | GM - Hotels, Resorts, Lodges | Ecotourism Advocate for Responsible Travel, Sustainability & Cultural Preservation

5 个月

Absolutely concur with your point Christine - given the estimated breakdown of very basic costs and expenses below, the owner makes almost no money - and the P&L does not even take into account rental or real estate’s expenses. Rough estimation. Revenue 8 COGS estimated at 20% = 1.6 Payroll & Related estimated at the very least 45% (in Spain as in the rest of Continental Europe may be even higher than that) = 3.6 Departmental expenses estimated at 10% = .80 Utilities at 10% = .80 Interests, Taxes, Depreciation, Amortization estimated at 10% = .80 Total profit / loss = .40

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