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Galician junta looking for organisation to run its albergues
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[QUOTE="jmcarp, post: 391750, member: 19617"] As I recall, the nightly rate in private alburgues in Galicia in 2013 when I walked was 8 to 12 euros per night per bed. Even given the higher profit margin demanded by a private enterprise vs a government enterprise (even a contracted one), it's not hard to see how the Xunta-operated albergues barely get by. Looking at this from an admittedly American sense of capitalism, raising the nightly rate just to the low end of the average rate for a private albergue would generate €670,000 in additional revenue based on the stated clientele, and adding another €1 per night would boost it to more than 1 million euros. That raises two questions: 1) would that be enough to make operation of the 70 albergues at least a break-even proposition, and 2) would the private alburgues raise their rates in response, seeing a chance to further increase their profits. The latter, of course, might result in more pilgrims seeking beds in the "cheaper" Xunta albergues, which would both put more demand on the Xunta albergues while at the same time having the potential side effect of bringing the profits of the private albergues back down to the pre-rate increase levels due to a drop-off in beds rented. If anyone has more current rates that would make my equations more accurate, it would be interesting to see if my line of thought still makes sense. [/QUOTE]
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