With the exponential growth of the number of cars in cities, the commercial sector and large companies are increasingly faced with parking problems. It is in this context that smart parking becomes the best technological option available for parking managers.
The main objective of a smart parking solution is to identify the presence (or absence) of a vehicle in a specific area or parking space with a high degree of accuracy. All this data is then collected, processed and analyzed by a central management platform and finally shared with users and parking managers. By incorporating IoT into a smart parking management system, it is possible to extract value from your data to enhance your business offering, streamline your operations and maximize your revenue.
How Do Smart Parking Management Systems Pay for Themselves?
When we discuss smart parking management systems, it is not always obvious what the return on investment (ROI) really is. The cost and ease of installation as well as the data value generated are major requirements to consider. Some of the revenue streams of a smart parking solution that provide a quick ROI include:
Direct revenue sources:
- Rental of unused spaces
- Increased enforcement — today less than 8% of parking violations are enforced
Indirect revenue sources:
- Increase of 20% in new customers for commercial areas
- Growth in revenue from paid parking
On indirect revenue sources, a smart parking solution makes it much easier for drivers to find parking, which contributes to a better customer experience and better turnover. A parking lot equipped with a smart solution could welcome up to 10% more customers, thus generating more revenue.
Example ROI for a 1,000-Space Parking Lot
To demonstrate the return on investment, let's take a 1,000 space parking lot with an annual occupancy rate of 70%. All costs are calculated in Canadian dollars.
Investment costs:
- Sensors: $650 × 500 = $325,000
- Gateway: $1,500 × 1 = $1,500
- Dynamic Display Panels: $1,900 × 10 = $19,000
- Installation: ~$51,800
- Annual recurring platform costs: $12,000/year
Total initial investment: ~$409,300 ($409.30 per parking spot)
Additional Sources of Income
By renting out unused parking spaces (30% of the lot) on a monthly basis at $100/month, managers can significantly increase their operational revenues:
- 80% occupancy (10% additional): $120,000 additional annual revenue → ROI in approximately 3 years and 5 months
- 90% occupancy (20% additional): $240,000 additional annual revenue → ROI in approximately 1 year and 9 months
Even considering only one additional revenue source, a smart parking solution is a worthwhile investment for any parking asset owner or manager.
Spatium's Smart Parking Management System
Spatium has created a complete smart parking management solution composed of three core elements:
- MPS Sensors — monitor parking lot status in any environment, mounted on walls, ceilings, or integrated into urban infrastructure
- M1 Gateways — enable communication between all sensors, including third-party devices
- Spatium Smart Parking Management Platform — allows parking managers to understand, manage, and control their parking lots in real time
Our sensors require no wiring, which significantly reduces installation and management costs. As an open solution, Spatium integrates with third-party equipment such as payment terminals, access barriers, license plate recognition cameras, and dynamic display panels.