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26 February 2025

Jerez Struggles To Balance Tourism And Traditional Commerce

The focus on tourism is reshaping Jerez's economy, with local businesses feeling the strain as rentals rise and residents leave.

The traditional commerce sector of Jerez de la Frontera is feeling the heat as tourism and hospitality are prioritized, transforming the economic fabric of this historic city.

According to Podemos Jerez, the emphasis on hospitality for tourist appeal is leading to the gradual displacement of local residents. María Jaén, the party's spokesperson, expressed her concerns about the essence of Jerez being altered due to the rise of vacation rentals, which are often more lucrative than traditional long-term housing.

"This phenomenon, combined with the surge of tourist rental properties, is obscuring the very essence of the historic center of Jerez and severely impacting its commercial activity," Jaén stated. The need for investment in housing rehabilitation is urgent; she suggests it's not enough to rely on heritage tourism and festive events to sustain the city's economic vitality.

Jerez's changing socio-economic structure is evident, particularly when examining the skyrocketing commercial rental prices. Jaén remarked, "One of the primary obstacles facing small businesses is the high cost of rents. Property owners need to understand the pricing of commercial spaces cannot remain anchored to the inflated figures of the 1980s and 1990s, when demand was far greater." Without adjustments to modern realities, numerous stores are left shuttered, some for extended periods.

The emergence of large commercial stores located on the periphery of Jerez—with ample parking and easy access—has compounded the decline of traditional shops. These larger entities have drawn customers away from the city center, leaving local retailers to struggle. While these businesses managed to withstand initial pressures, the absence of supportive measures has exacerbated their plight.

Jaén points out, "The commerce doesn’t disappear; it merely relocates. New commercial zones are sprouting up across Jerez, such as along Puertas del Sur and other avenues." This shift is also propelled by the growth of online shopping, presenting yet another layer of competition for smaller businesses, which lack the resources to mount defenses against the digital marketplace.

Yet as Jerez navigates these turbulent waters, there is hope on the horizon. Addressing what must change seems more important than ever. Policies must encourage proximity commerce, regulate the tourism housing sector, and promote accessible, fair rental conditions for local businesses, according to Podemos Jerez.

Meanwhile, the broader Spanish hospitality industry has faced its own trials. A report from TheFork revealed the worrying statistic: 25% of hospitality establishments closed due to poor financial planning and management. The report found the management of permits and regulations, as well as market competition, were significant hurdles for many restaurant owners.

To adapt to this volatile environment, the restaurant sector is pivoting. The upcoming HIP – Horeca Profesional Expo 2025, scheduled for March 10 to 12 at Ifema Madrid, promises to provide insights on sustaining hospitality businesses through effective management and differentiation. Notable figures from the culinary world, such as Joan Roca of El Celler de Can Roca and chef Manuel Franco, will share their experiences and strategies for success.

The importance of efficiency will be underscored, considering it enables cost savings and enhanced profitability across operations. Technology—and particularly the use of artificial intelligence—will play larger roles as restaurants seek to streamline processes and minimize waste.

The integration of these insights is not just academic; they represent urgent necessities for many businesses struggling just to keep their doors open amid rising operational costs.

Overall, as Jerez de la Frontera grapples with the dual-edged sword of tourism and hospitality-driven economic transformation, it is clear actions must be taken. The preservation of local culture and commercial integrity hangs perilously on finding the balance between welcoming tourists and supporting local businesses.