Editor’s note: This article was first published in January 2012, during Spain’s economic crisis; the fall in hospitality sales, the then-recent smoking ban, the Dukan diet boom and the description of the Mae West nightclub in Granada reflect that time.
Until relatively recently, cafés, bars and nightclubs were weathering the crisis perfectly well, but over the last two years (and more sharply in 2011-2012) most of them have started to see sales fall. It may be because consumers are losing ever more purchasing power, because of the anti-smoking law (Spain banned smoking in bars and restaurants in 2011) or simply because the hospitality sector is saturated.
That’s why hospitality business owners, as well as new entrepreneurs who decide to open this kind of business, need to follow the same guidelines as any other sector: distinction, innovation, adapting to the market and originality. Here are a few business ideas for the sector.
In a previous article we discussed hybrid shops, a business model that is being very well received and is proving profitable, since adding a second line of business to your premises is a good strategy.
Themed pubs
Nightlife offers plenty of choice, and there really is demand, so it’s a matter of catching the attention of young (and not so young) people by offering something original and innovative. On my travels around Spain I’ve seen places that I’m sure became fashionable purely because of how the pub looked. I’ve seen nightclubs and pubs decorated in Egyptian style, where the bar staff dressed as pharaohs. Every last detail of the place was taken care of to transport customers to ancient Egypt.
Take Granada (Andalusia), where, at a time when the city was saturated with nightlife venues, Mae West opened: a nightclub right in the city centre, inside a shopping centre. The decor recreates the Old West, and the club is divided into several rooms. The result is a packed house seven days a week, despite the oversupply in the province. They simply chose a good location, made heavy use of social media and, of course, innovated.
Specialised restaurants aimed at…
Most restaurants have seen a huge drop in sales, although others are booming. Until now, when you opened a restaurant you had three options:
- Go for low prices and a set menu.
- Go for a well-off, luxury, à la carte clientele.
- Be just another place where the food is good and you’re neither expensive nor cheap.
Now, thanks to changing habits, there are other ideas. Some restaurants focus specifically on food for people with diabetes, others on vegetarian food, and others took advantage of the Dukan diet boom to specialise in the doctor’s followers and offer Dukan food. You have to give customers what they want; all you need to know is how to attract the customers you want to have. When it comes to restaurants, target a specific and large audience. If you get the focus right, it’s a profitable business.
Fun
Don’t forget something everyone wants in their free time: as a rule, we like to have fun. It doesn’t matter whether your product or service is better or worse than the competition’s. If it’s more fun, it will draw more people.
Some restaurants have live music from local singers. That’s something innovative in our country and so far it tends to go down well, especially if you hire singers who perform romantic music for dinner on 14 February.
Others play it safe with humour, so on some evenings they host their own comedy club, where you listen to live stand-up while you eat. Your food might not be great, but between the laughs you’ll hardly notice the taste 🙂
Tapas bars
I’m from Andalusia, so for me a tapas bar is nothing new, but I do notice that people from elsewhere are literally amazed by Andalusian tapas. Outside Andalusia, if you order a beer and want something to nibble, you have to pay for both the beer and the snack. Where I’m from, a drink always comes with a “free” tapa.
I know this system is already being adopted in some places in the north of Spain, and I’ve even been told that outside Spain, in Australia, there’s a bar called Bar Andalucía, where a foreigner who had once spent his holidays in Andalusia decided to bring the system to Australia. From what I was told, the business was a great success, because in that country he was a pioneer and did something original.
I’ve also seen that in other parts of Spain the system has been copied very badly: they serve a tapa with a beer but not with a soft drink, and charge more for the soft drink. If I remember correctly, a soft drink has a higher profit margin than a beer.
In short, in a saturated sector any idea is welcome to make your business profitable, as long as the approach is right and there’s a big enough market for it. The advantage of the hospitality sector is that you can do a lot through social media, especially in nightlife aimed at younger customers, who, after all, use social media the most.
Further reading
- Wanting, knowing and being able: that’s where business success begins
- Business goal: don’t go under in the first year
Featured image: Daquella manera, CC BY 2.0, via Flickr.
