Kiosk or app on a 40-space lot you never visit?

Question

Working out what a first parking deal actually costs to run and the payment system is the line I can't pin down.

Small lot, 40 spaces, mix of hourly daytime and a handful of monthlies. Two ways people seem to do it.

Kiosk: you buy or lease a pay station, drivers pay at the machine, you get a display space number or a windshield slip. Up front cost I've been quoted runs $8k to $15k installed depending on the unit, plus a service contract. It's yours, no revenue share, but it's a machine outdoors and machines outdoors break.

App: signs with a code, drivers pay on their phone, the vendor takes a percentage of every transaction. Zero up front. I've seen 6% to 12% quoted. Enforcement runs off a license plate list you check on your phone.

At 40 spaces and maybe $45k of annual gross, 10% is $4,500 a year forever, which passes the kiosk cost in year three. That math says buy the kiosk.

But the app people argue the kiosk is a maintenance item, older drivers do actually use apps now, and you get plate data you'd otherwise have to collect by walking the lot. And if I'm an hour away, driving out to reset a frozen pay station on a Tuesday is a real cost that doesn't show up in the $12k.

I don't know which of those matters more at this size and I suspect people here have strong opinions in both directions.

marcus_hale41 · Answer

I've done diligence on lots running both and the variable that decides it isn't the fee, it's your enforcement.

Whoever collects, you still need someone walking the lot or reading plates. If you're an hour out you're hiring that either way, and an app that hands you a live paid-plate list makes that person's job about four minutes instead of twenty. That's the real saving and it doesn't appear in your 10% math.

On the kiosk breaking, ask the vendor for their average downtime and who eats the lost revenue. Most service contracts I've read cover the repair and not the revenue, so a five day outage in a busy week is your loss.

The number I'd want from you before voting is your transient share. If 30 of your 40 spaces go monthly, the transaction fee applies to a much smaller base and the app gets cheap fast. If it's mostly hourly, $4,500 a year is real and it grows as revenue grows.

One more thing on your $45k gross. Check whether that's what the seller collected or what the lot could collect. Those diverge a lot on transient lots with weak enforcement, and the gap is usually the whole deal.

Kiosk or app on a 40-space lot you never visit?

1 reply