Parking Management: Unlocking Revenue & Regulating a Downtown Lot

A case study that follows Sailor and the Dock, a local market, bar, arts, and events venue, that faced a parking management struggle resulting from the overuse of their parking lot by non-customers.

In a bustling urban environment, parking can be both a lifeline for your current customers and a magnet for potential customers. For businesses in downtown areas, the need for parking management often isn’t driven by the number of parking spots, but the constant influx of people using those spots without contributing to the business, turning a potential amenity into a financial burden.

Sailor and the Dock, a vibrant local market collective and food hall in downtown Oklahoma City, experienced this exact frustration. As a community hub, their primary focus was creating a welcoming space for patrons. However, their conveniently located parking lot became a free-for-all for those visiting nearby attractions, diluting the benefit for their actual customers.

The Problem: The Economic Drain of "Free" Parking in a Downtown Core

Offering free parking can be a draw, but when that generosity is exploited, businesses face several challenges that translate into real economic losses:

• Reduced Patron Convenience & Lost Sales: When non-customers occupy spaces, genuine patrons struggle to find parking, potentially leading them to take their business elsewhere. This demonstrates the direct correlation between parking availability and sales.

• Unrecovered Operational Costs: Maintaining a parking lot – including mortgage, taxes, and upkeep – represents a significant expense. The National Parking Association (NPA) estimates that the average cost to maintain a surface parking lot can range from $500 to $1,500 per space annually, depending on factors like location and surface type. When non-customers utilize the space without contributing, the business absorbs these costs without any direct return.

• Lost Opportunity Cost: Every parking space occupied by a non-customer represents a lost opportunity for a paying customer to patronize the business. In high-demand urban areas, this lost opportunity cost can be substantial.

• Increased Congestion and Decreased Efficiency: Drivers circling for parking due to limited availability create congestion, which can deter other potential customers and increase local traffic, indirectly impacting business operations.

  
  

For Sailor and the Dock, situated near the Civic Center and local schools, the problem was particularly pronounced. As Hamid, the founder and operator, explained, "Because we're in an urban setting and the parking lot’s available in downtown, a lot of times people would just come and park in our parking lot."

The Hidden Costs: A Closer Look at Sailor and the Dock's Example

To illustrate the economic impact, let's consider a simplified example based on Sailor and the Dock's situation:

• Parking Lot Size: Assume Sailor and the Dock's lot has 20 parking spaces.

• Average Daily Non-Customer Usage: Let's say, on average, 10 of those spaces are occupied by non-customers each day.

• Potential Revenue per Space: If Sailor and the Dock could charge a modest $5 per parking session, they would lose $50 per day (10 spaces x $5) due to non-customer use.

• Annual Revenue Loss: Over a year, this translates to a potential loss of $18,250 (365 days x $50).

• Annual Maintenance Costs: Hamid mentioned paying a mortgage and for maintenance. Let's assume the annual maintenance cost for the lot is $5,000 (this would include things like resurfacing, line painting, general upkeep).

  
  

In this scenario, the unmanaged parking not only prevents Sailor and the Dock from generating $18,250 in potential revenue but also forces them to absorb the $5,000 maintenance cost, effectively turning the parking lot into a $23,250 annual expense, rather than an asset.

This example demonstrates how seemingly "free" parking can lead to significant financial strain for a small business. As Hamid stated, "I'm paying the mortgage for this parking lot, I have to pay the bank every month, I have to earn something from this."

The Solution: Monetizing Existing Parking with Effortless Management

Park Thrive offered Hamid a solution that shifted the paradigm from fruitless enforcement to simple monetization. Instead of investing in costly and potentially customer-unfriendly barriers like a "$50,000 (dollar) gate and fence system," he found a system that could capture the inherent value of his parking spaces.

Park Thrive provided several key benefits:

• No Upfront Cost: Believing in the profitability it offers, Park Thrive requires no initial investment from the business owner, making it a risk-free solution to explore.

• Effortless Setup: The implementation process is designed to be quick and easy, without the need for complex installations or dedicated staff.

• Simple Customer Validation: For genuine patrons, validating parking is as easy as scanning a QR code – no app downloads or complicated procedures to deter visits.

• Automated Invoicing for Non-Patrons: For those using the lot without validation, the system facilitates easy invoicing, turning previously lost parking into a revenue stream with minimal effort.

  
  

By implementing Park Thrive, Sailor and the Dock achieved significant positive outcomes:

• Revenue Generation: The parking lot now contributes to covering its own expenses and potentially generating additional income. "It's definitely had an impact and has helped to cover some of the expenses that we have with parking lot maintenance," Hamid noted.

• Improved Patron Experience: By deterring non-customer parking, genuine patrons have a better chance of finding available spaces.

• Reduced Management Burden: The automated system minimizes the time and effort Hamid and his team need to spend on parking management. 

• Positive User Experience: The seamless QR code validation ensures that customer parking remains convenient and hassle-free.

  
  

The Big Picture: Smart Parking Management for Urban Businesses

Sailor and the Dock's experience underscores a critical point for businesses in urban environments: effectively managing parking doesn't always require aggressive enforcement or alienating measures. Sometimes, a smart, user-friendly system that acknowledges the inherent value of parking space can be the most effective solution.

Park Thrive offers a personalized approach that focuses on:

• Low Barrier to Entry: The no upfront cost model demonstrates confidence in the system's ability to generate value for the business.

• Ease of Use: For both the business owner and their customers, the system is designed to be intuitive and require minimal effort.

• Focus on Monetization: Instead of solely focusing on prevention, the system provides a simple pathway to capture revenue from parking usage.

• Seamless Integration: The lack of bulky installations ensures a smooth integration with existing business operations.

  
  

Just as the Oklahoma City Downtown Partnership emphasizes the importance of accessible parking for the vitality of downtown businesses, Park Thrive offers a modern tool to manage that accessibility effectively – not just for customers, but for the business's financial health as well.

Conclusion:

For urban businesses like Sailor and the Dock, where parking can be both a necessity and a challenge, Park Thrive offers a smart and simple solution. By focusing on easy monetization and a seamless user experience, it transforms a potential liability into a valuable asset, allowing business owners to focus on their core operations and the satisfaction of their genuine customers.