I was talking to a buddy at the IPI, who wants to remain nameless, who was telling me that in his company, the acceptable lost ticket rate is .25% — that’s a quarter of 1 percent — 1 lost ticket for every 400 issued. I was impressed.
I have had operators tell me that an acceptable rate is 5%, even 7.5%.
How about some assumptions —
Assume that every lost ticket is a full daily rate ticket — and that money is lost.
Assume that the daily rate is a very inexpensive $5.
Assume the garage issues 1000 tickets a day. — with our 5% that’s 50 lost tickets a day. Or a loss of $250 a day — $7000 a month — $91000 a year… and that’s acceptable.
In my buddy’s garage, the loss would be $4500 — not good, but better than $91K.
How does an operator ensure that lost tickets aren’t marching out of a garage at the above rate, or higher. I’m told its by attention to detail. Even in so called "cigar box" garages the exit transactions can be counted, and if properly wired, the counters continue to work even when the gates are locked open.
Its easy to know how many tickets were issued, how many were returned, and how many were lost.
The reason the numbers are so bad that that perhaps as an industry, we don’t pay attention to that detail. Some do, lets face it, but many don’t. I think it goes back to the competency of the garage managers.
Lets say you have a 1000 car garage worth about $20,000,000. You have a free cash flow of $1,000,000. Now what should you pay the manager of this asset. The odds are that the owner has pressured the operator to pay up to 40% under market for the manager — or the operator has a manager running two or three like locations. How in the heck can one expect the ticket rate to be .25%?
And of course, that’s only the beginning – what about doing a monthly card audit? Or checking the contracts to ensure that monthly parkers are paying the proper COL adjusted amounts? Or ensuring the "deals" cut with valet companies, or restaurants, or local retailers are on the up and up. Oh yes, and how about marketing, etc etc etc
Its impossible to expect a person who will work for low wages to have the resources to handle this business. Are there some who will? Perhaps but they won’t be there long.
When we are talking about the kind of money involved the operators and owners need to work together to ensure that the persons who are responsible for that money have the qualifications and, yes, brainpower, to do it.
Just my opinion…
J
