Pricing Parking

When to collect?

• On entry
• Increases entry time resulting in longer entry queues.
• Bad idea when customers are anxious to get in and might negatively affect repeat visit rates especially during peak hours/days.
• On the way out
• Decreases entry time resulting in smaller entry queues.
• Longer exit queues
• Might be better than long entry queues?

What to charge?

• Fixed Price
• Simplest model.
• Can be collected at either entry or exit.
• Based on time (e.g., by the hour)
• Can only be collected at exit as it is variable.
• Uncertainty of price
• Can be mitigated by limiting the maximum price and marginally increasing price over just a few time intervals (2 interval example: $x for 0-3 hours, $x+y for 3-10 hours where y is marginal).
• Might influence customer behaviour to a small degree
• Might incentivise customers to leave early
• A  free for first x minutes policy might reinforce this.
• Based on demand and supply (charge more when supply cannot keep up with demand)
• Can be fixed or metered.
• Can be collected at either entry or exit if it is fixed and at exit only if it is metered.
• Might significantly influence customer behaviour
• Disincentivises casual customers from coming during peek hours.

Related

• On why charging for parking makes sense and dynamic pricing