I have twice budgeted for an island trip using mainland prices and been substantially wrong. The accommodation was what I expected. Everything else was not.
Why everything costs more
Straightforwardly, because it arrived by boat.
Every item in every shop has been through an extra transport leg, frequently in small quantities, sometimes on an irregular schedule. That cost is in the price of everything from bottled water to building materials.
The effect is proportionally largest on cheap heavy things, which is why water, beer and basic groceries show the biggest markup and a small expensive item shows almost none.
Fuel is a specific one. Electricity on islands without a mainland connection is frequently generated locally at high cost, which flows into the price of anything refrigerated, air conditioned or cooked.
The transport you forgot to budget
Getting there is the obvious cost and it is not the whole of it.
Ferries for vehicles are dramatically more expensive than for foot passengers, often by a factor of several. Taking a car to an island is frequently more expensive than hiring one there.
Inter-island transport, if you plan to move around, adds up quickly and is rarely included in anybody's mental budget.
And local transport on the island itself is often limited and priced accordingly. Taxis on a small island with four taxis are not priced like taxis in a city.
The version that catches people is the return leg. Ferries are frequently one-way priced in a way that makes the return more expensive, and peak departure times cost more.
The competition problem
The structural reason prices stay high beyond transport costs.
On a small island there may be three restaurants, one shop and two hire companies. That is not a competitive market and prices reflect it.
There is also nowhere else to go. A visitor who finds the restaurant expensive has the option of the other restaurant, and that is the whole option.
This is not price gouging exactly. Small businesses with a short season and a small population have genuine cost pressures. It does mean the usual strategy of walking further to find something cheaper does not work.
What I do now
Bring what is heavy and expensive from the mainland.
Specifically: water if the tap water is not drinkable, which is a large weight and a large cost; any alcohol, which is frequently the biggest single markup; sunscreen and pharmacy items, which are expensive and always needed; and any specific food you know you will want.
This feels slightly absurd the first time and it is what people who go regularly all do.
The other change is self-catering rather than eating out for every meal, which on an island is a much larger saving than on the mainland because the restaurant markup is larger.
The season effect is sharper
Islands have a more extreme seasonal swing than mainland coastal towns.
In season, everything is open and expensive and full. Out of season, prices drop and a large proportion of the businesses close, sometimes almost all of them.
The shoulder weeks are the value, and on islands the shoulder is often very short — a couple of weeks either side rather than a month.
Ferry schedules also thin out dramatically out of season, which is the practical constraint. An island with four sailings a day in August may have four a week in November.
The medical consideration
Worth mentioning because it is a real cost and a real risk.
Small islands frequently have limited medical facilities. Anything serious means evacuation, which is expensive and weather dependent.
This is the specific case where travel insurance with proper evacuation cover stops being a formality, and where the cheapest policy is likely to be the wrong one.
It is also worth knowing, before booking, what medical provision actually exists, particularly if travelling with anybody who might need it.
Where islands are genuinely good value
To be fair, there are cases.
Large islands with their own agriculture, industry and population behave like the mainland, because they are not importing everything.
Islands with frequent cheap ferry connections and real competition between operators.
And islands where the accommodation is genuinely cheap because tourism is undeveloped, which can more than offset the higher cost of everything else.
The expensive ones are the small, remote, tourism-dependent ones with a single ferry operator, which are also frequently the most beautiful, which is presumably not a coincidence.
Cash and cards
A practical point that has caught me twice.
Small islands frequently have limited card acceptance, one cash machine, and occasionally none. That machine can be out of service or out of money, particularly at weekends and in high season.
Withdrawal fees on island machines are often higher than on the mainland, where there is competition.
Taking enough cash from the mainland to cover the stay, rather than assuming you can withdraw on arrival, removes a whole category of problem for the cost of carrying it carefully.