Thursday, July 12, 2012

What's the Big Fuss about SF Park?

In one of my roles at a commercial car parking company, we would review up to 50 or so of the 80 or so car parks we operated, every week.  We would look over its performance, its performance against the surrounding competitions’ car parks and how it was tracking to budget. 

The review would include Average Ticket Values (ATV), Average Length of Stay (ALS), prices, volumes, staffing, revenues and occupancy etc.  We would look at the opposition’s volumes and prices also.  Out of all of these reviews, each week, the Operations Team would come up with about 10-15 change recommendations, and put about 10 or so on a ‘watch list’.  These changes would go out after the Wednesday meeting, to sign writers, programmers, and operations teams, to start dropping flyers to let customers know of the changes coming.  The changes would occur on the Tuesday of the next week as we didn’t want to make changes on a Friday or Monday.

A lot of the main parameters here are simple and easy to understand.  The tell you a lot about the behaviour of the customer relative to the operating conditions of the car park plus the surrounding competitive environment.  If a competitor drops their price by a $1.00 per hour, it’s going to affect the occupancy, volumes and ATV of the car park.  If a major load creating business shuts down or moves from the offices next door, the volumes and the ALS will change and so you need to respond with a change in price or other product categories.  All of these things are levers that affect the occupancy of the car park.

Occupancy of the car park site is the parameter that is the sum of all of the other parameters.  All of the other parameters are levers to drive full occupancy and full occupancy is a measure of an active, economic and effective car park site.  Occupancy drops, you need to review the other parameters to get occupancy back up, or if occupancy climbs, you need to review the other parameters to get the occupancy down to a manageable level. 

Occupancy has been how off-street car parks have been managed for as long as I can remember, but we now have a fuss over the introduction of occupancy as a prime parameter to controlling and managing on-street parking.  Why?  It’s not new.

Kevin Warwood

2 comments:

  1. SF park is interesting:
    - as they are one of the few public operations to actively set prices based on occupancy (up and down)
    - as they want to manage parking as a resource to the community while most other municipalities see parking as a source of revenue for their own coffers

    Of course above is not new for a commercial operator as you have been in. A commercial operator has to be efficient, it has to stay ahead, it has to compete for the customer.

    Many public / governmental bodies try to be (or talk about) being efficient without ever really being tested. In a way, SF park has put this on them selves and I really hope they set an example for their peers.

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    1. I am a great admirer of what they are trying to achieve there. The significance of their pioneering route to occupancy and dynamic pricing, for a public body full of politicians, cannot be under stated. We all know that politicians will use almost any lever to create issues out of nothing and to piggyback big issues to suit themselves. Parking is an easy issue to ride. The fact that SF essentially, took this lever out of the politicians hands and, within a set scope, gave it to a parking professional (assumption) to manage the operation, is huge. The fact that politicians gave this away is even an even bigger surprise and they must be commended. The fact that it is old technology, mechanisms and theory is almost irrelevant.

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