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Updated: 26-01-2011

5 Reasons to Expand your Tenerife Business Horizon

When people come to Tenerife and look for a business for sale, they tend to focus their attention on prime tourist areas. It’s the most obvious reaction for someone new to the island, but after reading this article you will likely change your mind. There are lots of reasons to look beyond Tenerife’s tourist resorts if you want to be successful, read on and learn about five of them.



As you move away from the centre of the main tourist resorts, competition is lower. That doesn’t only mean fewer businesses vying for the attentions of the passer by. Lower competition means that rents are lower. At the same time, lower direct competition and lower volumes of customers can mean that you may charge slightly higher prices and the profit margins may be higher.


Customer Loyalty

When all your customers are only in the area for a week or two, they are not going to visit your business very often, no matter how good your service is. That means that your business is unlikely to grow a customer base, which is the real value of many businesses. Move away from the centre of the resorts, or perhaps even better, to smaller tourist areas such as Golf del Sur and you’ll find customer loyalty. Long term tourists, such as the swallows who visit Tenerife for the winter months, and local residents form a staple market while the seasonal tourists beef up the numbers.


Market Size

It’s very easy to underestimate the spending power of Tenerife’s resident community. The island’s population is approaching a million people, all packed into a relatively small area around the coastline. Many foreign business owners think only of the potential market of their fellow countrymen, but to do this is to ignore the vast majority of potential spenders. Not only is the market large, it also has a broad range of demand, supporting many different types of businesses. Not everyone is an expert on running a bar or a restaurant, which comprise almost all of the businesses in the tourist areas. Moving further afield means that you have a wider variety of business types to choose from and you are more likely to be able to apply your existing skills, increasing your chances of success.


Factors Beyond your Control

If there’s one thing guaranteed to make entrepreneurs seethe with anger, stress and frustration it’s when something beyond their control detrimentally affects their business. When you deal exclusively with a tourist market, its something you’ll have to get used to. In recent months flights bringing tourists vital for these businesses have been cancelled due to a volcano in Iceland, bad weather (several times) and air traffic controllers’ strikes. And all these things tend to happen on bank holiday weekends or times when tourism should be particularly busy. Of course.


Quality of Life

Most people who buy businesses in Tenerife will manage and run them as well. There is little time to be taken off when you run a business focused exclusively at tourists. Hospitality and catering businesses are notoriously demanding on time, and in the tourist areas you will be lucky to have a day off. Run another type of business away from the tourist areas and you can enjoy your weekends off! You’ll spend more time at the beach than the poor bar owner, even if his business overlooks it all day!


Where to look beyond the Resorts

Probably the ideal places to look for a Tenerife Business are the smaller resorts and local towns which have a mix of foreign residents, Spanish locals as well as both long and short term tourists. Look in towns such as Callao Salvaje, Golf del Sur, Palm Mar, El Medano, La Camella... Expand your horizons, and give your Tenerife business the best chance of success.

By Irina Saltmarsh

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