Top 6 Parking Business Challenges and How to Overcome Them
You Can Overcome these Top 6 Parking Business Challenges
In the United States more than $10 billion is earned annually through parking businesses. Such businesses employ more than 160,000 people! Certainly, parking can be a lucrative endeavor!
But setting up any business is challenging.
With a parking company, or any start-up, there are legal concerns, governmental issues, human resource problems, things to buy, things to do… this list goes on and on. While we could never hope to solve them in a single article, we can help out in the 6 ways we listed here: Each one will help you a common challenge or concern in your parking or parking lot business.
Plus, if you hang on tight until the end of the article, you’ll find that we compiled 6 great resources where you can get some great ideas to make your parking business a success!
So here we go – 6 things that you need to know to excel in the business of parking cars:
1. Staff is everything.
Challenge: Collecting money and parking cars takes people. Good people. Dependable people.
Sure, customer service matters in almost every business, but in parking things are different. With most parking businesses, the people are the business.
Solution: Hire well, train well, and treat your staff well so that they do a good job for you. Find ways to motivate your staff that are specific to them and your business.
For example, in a really busy parking garage you might reward speed of accident free parking by providing bonuses or acknowledgement for certain milestones (like every 100 cars parked). In a less busy location, hourly bonuses or rewards for good performance when you send in a “secret shopper” might be more effective. Figure out what works for you and keep your staff motivated and happy.
Having a dependable staff who show up on time and treat customers’ cars right is the number one most important part of a parking lot business.
2. Location, location, location.
Challenge: In some areas of the world parking is a problem, but that doesn’t mean that there is a financially viable option for you to start a business parking cars.
Solution: Whether you are starting out or looking to expand, do your homework and know the area you are considering. We always hear in real estate that location matters, but this is perhaps more true in the parking business than anywhere else. Where your business is located is the most important consideration that you have.
You need to understand the challenges that people with cars face in your city and seek to fix their problems with the location and ease of access of your parking lot or valets.
Start out by talking to shop owners and people in the community to see what their parking experiences are. Then, become a customer yourself, driving around and trying to park at various venues to learn what the local parking needs are. Remember that there are opportunities to park cars for people in a lot of places including office and government buildings, retail centers and malls, hotels, stadiums and arenas, festivals and fairs, medical centers, hospitals, and more.These are all the places that might supersede the need for more parking, or they may mean opportunity for your parking business.
3. Planning is important.
Challenge: Too many people start businesses without truly understanding what they are getting into or creating a plan.It might seem that a parking business is so straightforward that it doesn’t require a lot of planning. Wrong. A clear business plan is paramount to the success of any company.
Solution: Create a business plan before you spend any money or park a single car. Consider issues such as start-up costs, target market, break even point, name, hiring, exit strategy, legal and licensing, etc. Ask yourself the following questions:
- Is there enough traffic in the area I am considering to make the business profitable?
- Are there zoning or other legal issues that I need to be aware of?
- Is the lot I will be running or the parking booth I will install in a visible area that customers will see?
- What will my overhead costs be?
- Does this area need a parking garage, valet service, or secured parking?
4. A web presence is necessary.
Challenge: You might think that a parking company is so simple and old-school that it has no need for a web page, but you would be wrong.
Today, people want to plan, research, and read reviews. They want to know, in advance, where to park their car while they see a ball game or attend a convention. They want to know that their vehicle and the arriving passengers will be safe.
Solution: Hire a company to design your website. It is not expensive but is an important part of modern business. Ensure that your website has valuable information to help anyone who might be traveling to your area. Consider allowing people to pre-purchase parking vouchers.
5. Keep security in mind
Challenge: Safety is a concern in any business, but with parking there are a number of different ways to think about security. Keep in mind that you want to ensure the safety of your customers and employees, for both ethical and financial reasons. But you also want to ensure at least some level of safety to their vehicles and the contents.
Solution: Your security decisions will depend on exactly where your business is located and how it is structured. Take the time to imagine different types of customers using your parking area during different times of day and different events. Imagine whether you need fences or other barriers, security cameras, staff monitoring the cameras, effective lighting, and on-sight guards.
Remember that insurance is an absolute must, to keep your own business interests secure. You also probably want to have a parking booth for attendants to sit in during busy times or bad weather, or even just to add credibility and visibility to your facility. In fact, the most up to date booths have conduit and wiring installed so that your technology specialist can run data and phone lines, as well as boxes for duplex ethernet ports and phone lines, which enhance security and efficiency.
6. Copy the best
Challenge: When it comes to business, too many people waste money trying to “reinvent the wheel” and do things in some new, original way when tried and true methods work just fine. They have a hard time believing that the issues they are facing in business have been worked through by others. Therefore, a lot of time, money and effort is spent trying to figure things out.
Solution: They say that imitation is the highest form of flattery; it is also very smart. Pay attention and learn from the best… and the worst. Save money by learning from those who came before you and recreating their ideas instead of coming up with your own.
Copy other successful companies, look at what works well for them and mimick it. Also, look at what the competition or parking places in other cities do wrong and figure out how you can avoid making the same mistakes.
And one bonus piece of advice: Don’t stop your learning here!
You can never be too well-informed! The following sources will help you create the
most successful parking business possible.
Learn more about setting up any business.
- Check out The E-Myth Revisited by Michael Gerber to learn great tips about being an entrepreneur.
- Read the Top 10 Challenges Small Business Owners are Facing Today.
- Take a look at the 6 Business Problems for Small Business Owners.
Learn more specifically about setting up a parking business. Check out the following articles for some great information on how to start a parking lot business:
- The Small Business Chronicle on How to Start a Parking Lot Business
- Truic on How to Start a Parking Lot Business
- Businessing Magazine on How to Start a Parking Lot Business Businessing Magazine:
Learn more about your options for buying or renting a parking booth now.