Case Study: Pay on Foot
Good Things Happen When You Take A Risk
Good things happen only when you take a risk. Thus Greg Pineda, site general manager for the Trillium in Woodland Hills, CA, described his trepidation when he moved forward with installing what he thought was the first completely pay-on-foot installation in the Southern California area.
"Ownership was concerned about the fact that parking was difficult on the site. Exit backups were long and potential tenants complained. They told me to fix it."
The parking operator, Standard Parking, recommended pay on foot to take the money transactions out of the lane and speed exit.
Once the decision was made to proceed, Pineda was impatient. He wanted the process to go smoothly, but also quickly. The benefits were going to be great. Not only would his leasing agents have another tool in their kit to assist in renting space in the complex located in an upscale area of Western San Fernando Valley, but also if things went right, he would see a substantial cost reduction and an increase in income.
"Our operator said that in addition to my goal, the reduced exit times, we would see a substantial reduction in payroll, lower cash handling, and a very quick payback. I anticipated a two-year payback on the project, but we may beat that considerably."
The problems on the site were exacerbated with a complex tenant mix. There is a very active restaurant (Cheesecake Factory), a large health club with special parking rates, and a Hilton hotel, in addition to the office building and its attendant valet operation. The 2,050-space garage with five entrances and three exits had to handle it all.
The system was bid out and Zeag North America was the successful bidder through its Southern California dealer, Integrated Access Systems. "We were very pleased with the speed of the installation. We had the equipment on site within five weeks of the order, and due to some good prior planning, completed the installation within a week. Based on my experience with such installation, this was light speed," Pineda said.
Pineda and his operator were concerned about acceptance, so they had a number of introductory classes for tenants. "We invited the parking coordinators and any other individuals who wanted to come," said Yanira Giron, Standard's director on the site. "We had a number of sessions and good turnout. Tim Morris of IAS provided a PowerPoint presentation, and we answered questions and had a good exchange. When we turned on the system, the tenants knew what to expect."
Signage is extremely important. Parkers are reminded that this is a pay on foot garage at entry, on the ticket itself, at the stairwells, and at the POF machines. The Trillium is also fortunate that there is one main pedestrian entry from the main building complex and the POFs could be strategically placed so most parkers walked by them both directions.
There were a number of issues that had to be dealt with in software.
First, the 4,500-member health club had a "four-hour free" clause in its lease agreement. The problem in the past was enforcing the rules. Some building tenants who were also heath club members would take a ticket on entry, and use a validation in lieu of a parking permit. (They would go out for lunch, get validated again, and not have to have a standard permit.)
That cost the Trillium some revenue. With the new system, health club members have an access card that allows them as many entries per day as they like, but only allows a total of four hours free parking per day. If they overstay their limit, they have to pay the regular rate to get out. It's more convenient for them to purchase monthly parking if they are tenants in the building. Problem solved.
Then there was the hotel. The new system has a ticket-encoding device at the hotel so guests can have their tickets encoded with their check out date and then use the ticket for entering and leaving until they leave.
The restaurant also has a validator that encodes the tickets with the appropriate validation. "They receive a two-hour validation, which means that most of their restaurant customers get out for no charge. They simply put their tickets in the exit reader and are on their way," says Giron.
The system also provides for separate "validation coupons" so tenants can validate tickets by providing their visitors a coupon that the visitor inserts in the exit reader along with their ticket.
Now that the system has been in for a couple of months, Pineda is very happy. "We have reduced our staff by seven people (all of whom have received like or better positions elsewhere in Standard's organization), reduced our lost tickets from five a day to virtually none, and whereas we received three to five promissory notes a day, we now have none. People can't argue with a machine, so they just pay."
The system accepts credit cards, not only at the POF machines, but at the exit readers as well. If someone forgets to pay at the machine, they can pay on exit using a credit card. "Over 50 percent of our transactions are by credit card," says Giron.
"I was stunned at how quickly parkers took to the new system. There were virtually no problems in the transition," added Pineda. "We had assistants at the POFs and in the lanes to help, but they (the assistants) actually slowed down the process. First I had them hide behind a pillar so they could see the lane and assist, but wouldn't be apparent to the drivers, then after a week or so, we removed them all together.
"One thing I would recommend to everyone installing POF is to remove the booths in the exit lanes. When parkers arrive and see no booths, they know something is different in the garage and are prepared to pay somewhere else. If they see the booths, they assume they can pay on exit."
"Everyone uses machines to pay for something in a lot of venues. ATMs are everywhere, you pump your own gas, actually check yourself in at the airport using a machine, and in many grocery stores and even 'Home Depot,' can check yourself out without using a cashier. I think that's one major reason why our transition was so quick and easy. People are becoming used to having no cashier."
Pineda thought that his location was the first in Southern California to have a full-blown pay-on-foot system with no in-lane cashier backup. When PT pointed out that there was, in fact, another location that had such a system (provided by Secom nearly five years ago) he was non-plussed. "I don't mind not being the pioneer. However, if I had known that there was another location with this type of system, I would have felt a bit more relaxed in the beginning. Knowing someone else has succeeded at full pay on foot would have been some comfort during the selection and installation."
John Lovell, president of Zeag North America, noted: "The Trillium project is a showplace not only for us but for the pay on foot concept industry-wide. This is a technology only seeing the beginning in the North American market. It's been in use in Europe and Asia for over a decade, however only in the past few years are we seeing more and more complete systems, without cashiers in the exit lanes."
John Van Horn is Editor and Publisher of Parking Today. He can be reached at firstname.lastname@example.org
Article Abstract from August, 2003