What are the real costs of parking?

February 18, 2019
Article

Context

To make it very concrete I’d like to look at those costs based on our case of a company of 100 employees and 50 parking spots. Basically, if you look at a company who has 50 parking spots there are hard costs that you cannot avoid if you have 50 parking spots of around 100,000€ per year that’s about 2000€/parking spot/year. Basically that’s what the parking costs to the company

Hard and soft costs of parking

Time lost

As you see, this company has 100 employees so not everyone has a parking spot and we can count on around thirty employees looking for a parking spot outside the company everyday because they haven’t been able to find a parking spot inside the company. So this adds to the hard costs, soft costs that companies do not think about when they think of the number of parking spots they need here. What are those soft costs? Let me take a very simple example. I’m an employee I drive to work I don’t have access to the parking or I have access to the parking but there are no parking spots anymore in the parking I have to drive into the parking look for a free parking spot I see there is no free parking spot so I drive outside the parking I look for a parking spot on the street I park, I have to walk to the office, basically I lose time everyday looking for a parking spot. If you consider this time as a lot of time that employees would have spent working for your company this can grow up to 5000€/year/employee that is lost in parking search. So if you look at those 30 employees looking for a parking spot everyday that you will be for your company a total cost of 150,000€/year. That’s one soft cost.

Frustration - efficiency lost

Then I’ve been looking for about 15 minutes this morning, I get to the office and I am very frustrated  because I lose time every morning so I get to the coffee machine and I talk with my colleague, I complain about traffic about parking and stuff so basically what we have noticed and what we’ve read is that this frustration is also a time loss and a loss of efficiency that your employees will have during work time that’s around 5% of their time which represents 3,500€ per year per employee. so again if we look at those 30 employees looking for a parking spot on the street everyday this adds another 100,000€ per year that you lose in timeloss and lack of efficiency of your employees. So that’s a soft cost. That is in total 250,000€. That’s a soft cost in time loss and that’s a very big impact on the wellbeing of your employees also which not to neglect.

Talent lost

Literature also says that 1 out of 5 companies loses time because of parking and mobility issues. So if we add here the fact that one employee leaves a company because of parking and mobility issues and if we consider that the fact that an employee leaves that’s around 50,000€ cost to replace him.

To conclude

Well the company here will have 300,000€ soft costs due to parking every year. So if you consider that compared to your hard cost of a 100,000€/year that you pay for the 50 parking spots that you think you need well basically the soft costs triple actually multiply by four the total cost of your parking every year. This can be avoided. This can be optimized but how ? This is something that we will tackle in the next video in Commuty.