For Local Authorities looking for ways to help town centre recovery...

Why FREE Parking is NOT the answer… but then, IT IS!

by Chris Reed

As well as a significant drop in parking revenues over recent months, local authorities now face the very real threat that a significant proportion of town centre businesses will simply not survive, which will cut into the revenues they receive from Business Rates. The financial challenges simply continue for these already cash strapped organisations. Throw into the mix the impending recession with higher unemployment, there will likely be reduced spending, shopping and leisure activity. Potentially people will be working from home for the foreseeable future now, thus fewer commuters will be spending in the local cafes, bars and restaurants for many months. Then, with more potential restrictions on the use of public transport, its easy to see why my mind is now drifting to the lyrics of the brilliant musician and songwriter, Jerry Dammers from The Specials, “Do you remember the good old days before the Ghost Town?”

But its not all doom and gloom. Many commentators have mentioned the rise of ‘moral shopping’, where local businesses in particular, who did positive things during the lockdown are seeing increased sales from local people. There’s definitely an increased sense of community in the air. Consumers are demonstrating a willingness to support their local businesses and spend more money in the local high street. Mary Portas has stated that this is actually a once in a lifetime opportunity for local high streets to thrive.

It is my opinion that only a collaborative approach among the key stakeholders in our town centres (which includes Local Authorities, Business Improvement Districts (BIDs), merchants AND consumers) can maximise the chances of recovery and as part of that, we should be rewarding those consumers in particular who choose to spend locally.

Many local authorities have chosen to make parking in town and city centres free during recent months so that keyworkers in particular get a little benefit for the vital work they do, and to encourage consumers back to the high street when the government have allowed non-essential shops to open. I also know that this strategy is something that many are considering to continue in some form or another as a mechanism to help stimulate footfall and spending in our local economies when we again emerge from the restrictions of lockdown. Even before the pandemic, there was often a call from local businesses for free parking as a means of stimulating the local economy. My suspicion is that this call will now be even louder. But is this a sustainable strategy for cash strapped local authorities who will have seen revenues from parking decimated in the last few months? I don’t think so.

What if there was a way of offering FREE Parking WITHOUT the Local Authority losing revenues?


I believe that I have the answer – its called ParkingPerx (yes, a shameless plug).

ParkingPerx rewards consumer spending in OFFLINE, town centre businesses with a credit that can reduce or eliminate the cost of parking.

It’s a way of linking free parking to spending on the high street – therefore a way of rewarding those consumers who shop locally (when allowed to do so).

Even before the pandemic, ParkingPerx was designed to help reinvigorate the high street. We have now enhanced it with a number of features specifically to address some post-lockdown issues, including helping with social distancing control.

Now, lets go back to the Local Authority and compare the two techniques of supporting local businesses with free parking – one without ParkingPerx and one with. Let’s say providing free parking would result in a loss of revenues of £10,000 to the authority. There is no real way of measuring the direct impact of that £10k investment on the local economy.

I know this from personal experience. I live in Northumberland and the County Council have operated free parking for many years as a way of supporting local businesses. This is all across the County, which covers its many market towns, including my home town of Morpeth. However, one of the problems in Morpeth is that the people who work there take advantage of the free parking without necessarily spending in the local shops. The two or three hour short term restrictions simply result in the regular, periodic sight of workers popping out of their offices to move their car to a different car park to avoid a ticket (and sometimes they forget). This has no benefit to the local businesses and the space is not necessarily being occupied by someone spending in the town. The Council therefore have no way of accurately measuring the impact of the free parking scheme on local businesses.

Now with ParkingPerx, the authority can use potentially lost revenue to directly stimulate local spending. Using our example, the authority can set up that £10k revenue loss as a reward subsidy instead, AND they set the rules as to how that reward is earned (which can include on which days / times and car parks it is available – park and ride anyone?). Let’s say that they decide that for a £20 minimum spend, the Consumer will earn £1 in ParkingPerx. Our solution qualifies each spend in participating Merchants through the Mastercard / Visa platform and notifies the user in real time when they have earned their reward.

So the £10k investment would leverage a MINIMUM of £200k spending in the local economy.

This is FULLY measurable. Not only that, we can provide analysis and insight on where, when and with which businesses the rewards were earned – providing valuable ‘smart cities’ insight and analysis on how the town centre is being used – where, when, why, by who, and where those shoppers and leisure seekers are coming from.

With ParkingPerx, merchants can ‘top up’ consumer rewards to incentivise higher levels of spending.

And here’s the kicker. The reward for the consumer is redeemed against their parking fees, i.e., it’s used to pay for parking. So the local authority, in collaboration with local merchants are increasing footfall, spending, loyalty, occupancy rates in car parks and therefore revenues for all stakeholders – all whilst enjoying the positive PR associated with free parking.

Note that the reward subsidy can be added to by other key stakeholders too, such as BIDs, LEPs or indeed private Car Park Operators.

This all goes back to the heart of my post – that collaboration between a town’s key stakeholders is the best way to aid the recovery of our vital local economies. With ParkingPerx, we believe that we have a tool that can help with that.

If you are interested in learning more about ParkingPerx and how it can help YOUR town centre, please don’t hesitate to fill in our contact form.