Can't escape capitalism in fantasy land
That's exactly what they are planning to do in this chapter. Normally something like inns would be run by 100% independent businesses, but now they are planning to have the inns to be operated by the feudal lord himself. Thats not really capitalism. Under regular capitalism the local government would just be collecting taxes from the businesses and from the numerous employees' wages, the employees' housing, and so forth. It could be difficult for private entrepreneurs to compete with the feudal lord, so for the general public, this arrangement is nothing good, as healthy competition could be missing. On the other hand, if that country has lost healthy competition already due to oligopolies, the current situation might not be good either. That's why in the modern world we have competition authorities trying to prevent such a situation from happening.
In our world, a region/town could still be running some critical "businesses", such as handling a town's water supply/sanitation, road/street maintenance, elements of health care, etc. Although in practice they could be handled by companies majorly or fully owned by the government. Often such entities employ private businesses as subcontractors for a lot of work.