I was always curious about people who work for a company and assume the money comes from the CEO, or the Board of Directors. What is most obvious is that in every case, in every company, in every organization, the money comes from only one place…The Customers.
We saw that in spades in March when the switch flipped and in short order the money flow in the parking business stopped. It didn’t stop because owners or operators decided to no longer buy goods and services, it stopped because there were no more people parking in garages, parking on street, using valets, and while doing so, paying the billions of dollars we, as an industry, use to survive.
A colleague asked “just who are the people that park in the garages?” First of all, they are a mix, a combination of daily and contract parkers. Depending on the facility the garages serves, they may be workers in an insurance company, sales people who move in and out throughout the day, support staff in law firms, and even the lawyers working in those firms.
Consider how much one firm with 100 employees may be paying for parking. Assume it’s a relatively inexpensive garage and the cost per space is $100 per month. That firm will pour $120,000 per year into the parking industry. $120,000 that will go to pay salaries, technology costs, cleaning fees, costs for lighting and security, and yes, expenses to retire the debt created when the garage was built.
But consider also the people who visit businesses in the building each day. People who park so they can have lunch or dinner in fine restaurants, who visit their attorneys, doctors, or financial advisors. People who go shopping in the stores near that garage, or who meet friends just to walk around the mall and see ‘what’s what.’ Assume that a garage has 200 of these visitors a day and each one pays $10. That another $500,000 (assuming 250 open days a year) that goes to fund our industry.
On that faithful day in March the spigot was turned off and the money went away. Now what?
I see two things happening.
First, the spigot will be turned on quickly. But only about halfway. It will take a few weeks for businesses to fully reopen and people to return to work. Even then , the daily parkers will, I think, be reticent and return more slowly. For the valve to open the second half, time will be required. Not as much as many think, but certainly a few months. By fall, the numbers will be back.
Second, the volume of cars will increase. The average person will not be as quick to take public transportation, to take taxis, Uber or Lyft – after all, who knows who was sitting in that seat just before you. Private cars will be dusted off, and taken for those trips to the doctor, lawyer, and out to dinner. We will be seeing an increase in daily parkers. Once again, not immediately, but a steady increase from the zero we see today. By the end of summer, things will be back, maybe not in spades, but back.
Those who predict a “new normal” will be surprised. We will be attending movies, concerts, bars and restaurants just as before. Maybe even more so, as we get our “mojo” back and realize how much we have missed.
You read it here first.
JVH
Yes I know I dangled a participle in that headline — I refer you to Winston Churchill, who, when criticized for occasionally ending a sentence on a preposition, replied, “This is the type of errant pedantry up with which I will not put.”
