How do you know if your parking lot is performing the way it should?
The first question you should ask yourself is: Are you measuring all the important metrics? If you’re not, I’m glad you’re here.
Measuring the performance of your lot can massively improve the health of your business. By paying special attention to parking metrics, parking operators can turn parking data into data-driven decisions that improve your lot’s performance.
Here are the most important metrics to measure.
Why Track Parking Metrics
If you’re not tracking parking metrics, you’re guessing. A parking lot isn’t just about having enough space. It’s about using them well.
Good data helps you see what’s working and what’s not. You’ll know a) when your lot is busiest, b) how often spots turn over, and c) whether pricing needs adjusting.
If spaces sit empty too often, you can fix that. If some areas are overcrowded, you can spread out demand.
Tracking metrics isn’t extra work. It’s how you make sure your lot is running at its best. If you’re able to invest in the right tools, you can capture business-saving parking data analytics that has the power to transform your parking management strategy.
Key Metrics for Parking Garage Managers
#1: Occupancy Rate
Occupancy rate measures the percentage of spaces that are occupied at any given time. This metric reveals important parking patterns to help you understand parking availability.
How to Measure
To calculate its occupancy rate, divide the number of occupied spaces by the total number of available spaces in your parking facility.
Formula: Occupancy rate = # of occupied spaces ÷ # of available spaces
If you don’t have a parking management system in place, you’ll want to periodically take inventory of available spaces throughout the day to compare later.
Good Result
A healthy occupancy rate of 85-90% shows that your parking facilities are being used effectively without excessive underutilization or overcrowding. This level of occupancy allows you to price dynamically during peak hours.
#2: Turnover Rate
The turnover rate indicates how often spaces are vacated and occupied within a certain period. This metric is important for grading space usage and determining whether space turnover can be improved.
How to Measure
To measure turnover, divide the total number of vehicles parked by the total number of available parking spots in a specific time frame, such as daily or weekly.
Formula: Turnover rate = total # of parked vehicles ÷ # of available parking spaces in a specific time frame (daily, weekly, etc.)
Good Result
A reasonable turnover rate for a parking garage is 3 to 5 times per day (roughly).
Note that a high turnover rate is actually a good sign. It indicates good use of your parking spots. A steady flow of vehicles means that more spaces are available more often.
#3: Revenue per Space
Revenue per space measures how much money each parking spot generates. This metric helps you identify high-performing areas and determine which sections of the parking lot need more attention or different pricing structures.
How to Measure
To measure this, divide total parking revenue by the number of available spaces.
Formula: Revenue per space = total parking revenue ÷ # of available parking spaces
Good Result
A higher revenue per space shows that your pricing strategies are working well and that spaces are being utilized efficiently. You should aim to cover operational expenses plus a profit margin of 25% or more.
#4 Peak Usage Times
You should know your peak usage if you want to supercharge your revenue potential. This metric helps parking managers determine the busiest hours and days in their parking lot so that they can adjust rates according to demand.
How to Measure
This is just the occupancy rate at different hours of the day captured over a period of time. If you have a way to track this metric using your existing parking system, that’s a bonus. If not, I recommend having staff track the occupancy rate hourly or review camera footage later.
Formula: Peak Usage Rate (%) = (Number of occupied spaces ÷ Total available spaces) × 100
Good Result
With peak usage times, there isn’t a tangible number that you should be aspiring for, but that doesn’t mean you shouldn’t monitor how demand fluctuates through the day and week. This will make it easier to plan pricing around demand.
#5 Length of Stay
This metric is pretty self-explanatory: how long are vehicles staying in their spots? This is important for parking lots that offer both short-term and long-term parking.
How to Measure
To measure the average length of stay, track each vehicle’s entry and exit times using sensors or ticketing systems. Data gathered from these systems will provide you with the average duration that vehicles remain in parking spots.
Formula: Average Length of Stay = Total time vehicles are parked ÷ Number of vehicles
Good Result
The ideal length of stay will depend on whether your lot is intended for short-term or long-term stays. If you charge daily or weekly rates, you want low turnover and longer stays. If you charge a flat fee (by vehicle), then you’re looking for high turnovers and high occupancy.
#6 Revenue Growth Over Time
Tracking revenue growth over time is just good business practice. Are you growing or are you stagnant? This metric is vital for long-term business planning and strategy.
How to Measure
Compare revenue over different periods-monthly, quarterly, or annually. This step is much easier if you have a system that tracks revenue.
Formula: Revenue Growth (%) = [(Revenue in current period – Revenue in previous period) ÷ Revenue in previous period] × 100
Good Result
A good result is steadily growing revenue, which suggests effective parking operations and pricing strategies.
#7: Cost Per Space
Cost per space determines how much each parking spot costs to maintain. Are you charging enough for your parking spots to cover expenses?
How to Measure
To calculate your cost per space, divide the total operating expenses by the number of available spaces
Formula: Cost per space = Total operating expenses ÷ Number of available spaces
Good Result
For cost per space, you should be aiming for a number well below your revenue per space. Again, a healthy margin of over 25% is what you should aim for. Anything lower and you should find a way to reduce expenses or increase pricing.
#8 Violation/Enforcement Rate
If your garage has time limits or reserved spaces, keeping up with violation enforcement can be tricky. But you’ll never be able to manage something if you don’t track it. When you track violations, you’re able to find ways to reduce it.
How to Measure
Track the number of violations issued – this might be expired parking permits or unauthorized parking – against the total number of parked vehicles.
Formula: Violation Rate = (Number of Violations ÷ Total number of parked vehicles) x 100
Good Result
The lower the violation rate, the better – aim for at least below 5%. If it’s any higher, there is a bigger issue going on, and you could be missing out on some serious revenue potential.
Revenue Optimization and Parking Lots
If you’re going to start maximizing parking revenue, you must capture parking metrics (like parking usage). That way, you have detailed insights into historical data on hand.
Beyond tracking, here are a few other opportunities to maximize revenue and increase operational efficiency.
Dynamic Pricing
Once you know how your parking lot operates, dynamic pricing will help you optimize your revenue potential so that you can charge higher fees when demand grows and apply discounts when it drops.
Customer Loyalty Programs
If your lot is used often, you can offer monthly parking passes or perks to frequent visitors. Recurring monthly revenue is a great starting point for a more successful business.
Pre Booking and Digital Payment
A growing number of parking lot owners are allowing customers to book parking in advance using their mobile phones. It’s a little bit of a shift in dynamics, but giving your customers the ability to book in advance with preferred payment methods is a big stress reliever. Plus, you’ll be able to use booking data to leverage predictive analytics.
Fill Up Vacant Spaces With Neighbor
If a disproportionately high # of your parking spaces are currently vacant, turn to a peer-to-peer platform like Neighbor. Neighbor matches you with qualified renters looking for additional space to store or park their vehicles. If a section of your parking lot or garage is underperforming, you can supplement monthly revenue from RV or boat storage. Find out how much your space can earn.
