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With more and more people buying cars every day, the scramble for the parking lot will continue to increase.
There is always a need for the parking lot as people continue to roam the streets and pay for a place to keep their personal cars. While others may see this as a problem, as an entrepreneur, you should think of it as a parking lot business opportunity.
This tells you that there is a huge demand for a place for parking and you should find ways to monetize this demand. But it’s not going to be a walk in the park especially if you’re new to this kind of parking lot business.
Before you get too excited about your newly discovered parking lot business idea, there is a lot you need to know about buying a parking lot and starting a parking space parking lot business. Let’s review.
The Parking Lot Business Plan: Buying a Parking Lot
The first step toward starting a business in coming up with the idea.
For the idea to be put into action, you need to write a parking lot business plan. The success of your parking lot business starts with a good plan where you have the time to weigh the opportunities versus the threats. Plan everything your parking business needs before diving into action.
This plan should take into account the capital you’ll need to acquire, your daily operating expenses, and the taxes you’ll have to pay on the property and on your revenue. With this information, you’ll be able to determine how much you should be charging for each parking space to maximize your profits.
Determine Your Funding Source
You cannot start your parking lot business without having a stable source of business funding. You need to find out the cost of constructing the parking lot and getting it running, the cost of acquiring a permit and all the taxes you need to pay to the government.
Check with loan officers to see if you qualify for a commercial loan and if the loan will be enough for everything you need for the business or just for a startup. You can also reach out to venture capital firms to secure funding. Unlike most startups, a parking lot parking lot small business financing is an easy way.
People need places to park and you charge them to use your space. Anyone looking to invest in a parking lot business that can start making money instantly will be able to understand that.
The Location of Your Parking
The location of your parking space will determine the amount of revenue you’re going to collect at the end of the day. The first thing you need to know when talking about the location is the volume of people that are going to access that location.
If you want more people to access the parking space, you need to locate it near shopping centers, harbors, or buildings that many people access.
Secondly, you need to clear everything with the local authorities. Find out if the local government will warrant the construction of a parking lot in that area.
Lastly, ask yourself if you want a parking garage or a parking lot. If you go for a garage, this means you will offer more parking spaces, but it will cost you more to construct. But, with a parking garage, people are often more willing to pay for parking because their cars can be protected from the elements.
Picking a location where people are willing to pay more per parking space is also something you should consider.
The Paving Lot
You have to have high-quality pavements for your parking lot, and you need professional people to do the job. The amount of money you’re going to use in the pavement will also depend on the size of your parking lot.
High-quality pavement material will ensure your parking lot is always in good condition which will save you on maintenance costs as well as attract more customers in the long run. No one wants to park in a lot filled with rim-wrecking potholes and massive cracks in the pavement, after all.
If your parking lot looks like it’s in good shape, customers will perceive their cars to be safer, too.
Monetize Your Parking Lot
At this point, you have to think about how you’re going to charge your customers for the parking fee. You can have a cashier to collect the parking fees at the gate or have an automated payment system. This also means you should have a business bank account where the money will go.
This will keep your finances organized and make your business appear professional and well-managed. Additionally, you need to set up a business account to record your expenses and incomes. You will be able to monitor the performance of your business and have accurate and detailed accounts.
Staffing in Business
For your parking lot to get running, you need to have a reliable staff in your parking kiosks. Of course, at this point, you already have a cashier or an accountant, but they won’t be the only people running the business.
A parking lot is always a busy environment with a lot of things going on, and you will find yourself needing more staff than you first imagined. Even though this will mean you will have to spend more on salaries, it will be for a good course.
You will need maintenance staff to keep the place clean and in good working condition, and those who will guide vehicles to open parking areas for easy flow of vehicles especially if you receive a lot of traffic.
You should also ensure the place is secure by employing security guards and installing CCTV. The area also needs to be well lite to discourage thieves and idlers. You need to do all it takes to ensure the safety of the vehicles parked there as well as protect your property.
Permits and Licenses
Every state has its rules and regulations when it comes to setting up various kinds of businesses. You need to find out what kinds of permits and licenses you need to acquire for your parking lot business.
Failure to secure the necessary permits and the licenses can result in you getting fined or even your business getting shut down.
Insure Your Business
All business owners should insure their businesses. There are different legal requirements for insuring employees and enabling them to get compensation in case of anything.
Beyond what the law says, though, insurance is a solid financial investment. So many businesses get bogged down in lawsuits every year, and in many cases, having insurance will help you avoid these issues.
For example, if you an employee of yours gets injured on the job, the employee can sue you for compensation, which can cost you a ton in legal fees and damages. Similarly, a customer can sue you for damaging their car if one of your valets makes a mistake.
Having insurance can help you sidestep these problems should disaster strike.
Though the thinking here isn’t the same, we also recommend offering health insurance to your employees. This will help you attract the best candidates for the job. Like with anything, you get what you pay for. If you’re willing to invest in your employees, they’ll be willing to invest in you.
Promote Your Business
Once you get everything in order and your business is up and running, you need to ensure you get all the customers you can get by promoting it. This can be through word of mouth or if you can afford to pay for the commercial. Another great way to promote your business is to have an online presence.
This means you need to create a website so that your customers can easily find you and learn about your business. You can use social media to reach out to new clients and grow your parking lot business.
Need More Business Advice?
Buying a parking lot and starting a parking lot business requires a lot of preparation and planning. There are a lot of things to do, permits to acquire and staff to hire. You also need to prepare yourself for the risks involved and grab every opportunity that comes your way.
It is going to be hard to start, but once your parking lot business is up and running, the reward is going to be huge, and you are going to pat yourself on the back for having such a brilliant business idea.
If you’d like more business advice as it relates to the parking business or any other industry for that matter, be sure to check out the business section of our website! The road to successful parking lot business ownership isn’t easy, but we’re here to help.