Parking charges are often a sensitive issue. While customers want prices to stay low, shopping centres and councils rely on this additional income to boost revenue. But despite the lingering effects of recession, car park operators are doing the unthinkable: slashing parking charges, and in some cases scrapping them completely.

In recent months, councils and centre managers have been cutting parking rates even in the face of a dwindling retail market. Rotherham town centre introduced its ‘Free After 3’ scheme in May, allowing shoppers to park for free in all council-run car parks after 3pm. And St David’s Partnership, the joint venture behind St David’s in Cardiff, has announced competitive rates across both its car parks with an evening charge of £1 after 5pm.

Slashing prices might seem risky at a time like this, but Rotherham’s town centre manager Julie Roberts assures that long-term benefits can be had from meeting shoppers in the middle. “Parking charges have always been an emotive issue and therefore we felt it was important to look at this and see what steps we could take to reduce the cost for visitors,” she says.

The ‘Free After 3’ campaign targets late afternoon visitors: friends meeting up after work and families coming into town for an after-school shopping trip. By waiving afternoon charges, as well as offering free parking on Sundays, Rotherham Borough Council and Barnsley & Rotherham Chamber of Commerce aimed to encourage shoppers into the town centre during their free time.

Andrew Denniff, policy and communications manager for the chamber, emphasized the need to help local retailers through the downturn. “This is not an easy time to do business but both the council and the chamber are committed to doing what we can to support the town centre and encourage shoppers into Rotherham,” he says.

In the three months since the scheme launched, Rotherham has seen a consistent rise in footfall post 3pm. And positive feedback from retailers supports the idea that parking pricing strategies, if planned correctly, can help fight the downturn by bringing more people into shops and centres.

Children’s clothing retailer Adams has a store in Rotherham town centre. Linda Bough, store manager, says: “We’ve been pleased to see a boost in footfall and our figures in the last few weeks. Some of our shoppers are changing their habits and coming in after 3pm due to the initiative, however we have also seen some new customers and a rise in the value of the individual transactions made.”

The team behind St David’s 2 has also picked up on the widespread benefits of cheaper parking. Neil Carron, project director at St David’s Partnership, explains why these rates were chosen. “Our experience from other schemes gives us an insight into how trade develops and what it takes to establish new customer habits.

“Using this method, we believe we will achieve higher occupancy and income levels without cutting back on the all-important management regime,” he says.

Like Rotherham, St David’s 2 has identified the need for discounted rates at times when people are more likely to shop. The centre’s extended opening hours and 24-hour parking enable shoppers to visit after work or school, but parking rates could have acted as a deterrent if set too high.

However, centre manager Steven Madeley is certain that the £1 evening charge will entice shoppers to the centre in droves. “We are working hard to keep costs down to help shoppers enjoy the whole experience that little bit more, and to encourage more people to visit the city centre once working hours are over,” he says.

But if charges are being lowered to attract hard-up customers during the recession, will St David’s hike parking rates once the economy starts improving? Apparently not, if Carron is to be believed. “We have looked at what we think the right level of car parking charges should be, not just on opening, but for the first years of operation.

“This allows us to project costs and income over a long period of time, whilst helping us optimise use of the car parks from day one,” he says.

Not every operator agrees with slashing rates. After all, parking facilities and services such as lighting, signage and CCTV aren’t cheap. Without direct funding, who will end up paying for the maintenance and security crucial to any operating car park? According to Grahame Rose, development director at CP Plus, it inevitably comes back to
the shopper.

“Parking facilities and services have to be paid by someone, whether directly or indirectly,” says Rose. “If the retailer is asked to foot the bill, won’t that inevitably lead to an increase in prices in the shops, ultimately impacting on the shopper and discouraging visits?”

And scrapping charges altogether has its fair share of problems, Rose explains. “As well as acting as a revenue stream, parking charges serve as an efficient way of managing parking congestion, and ensuring spaces are available for bona fide users and not monopolised by commuters or other unauthorised long-stay parkers,” he says

So if low rates in fact have a negative impact on consumer footfall and spend, what does CP Plus suggest as a long-term pricing strategy?

“We believe in balance when it comes to pricing policies; realistic charging regimes, backed up by fair enforcement systems, with meaningful concessions in place to encourage loyal and high spending visitors,” says Rose.

Castlepoint in Bournemouth has offered free parking since it first opened in 2003. General manager Peter Matthews insists that charging shoppers to park was never a consideration. And according to Matthews, sticking to the initial pricing strategy has paid off. “Our retailers benefit from the average dwell time of 92 minutes per car,” he says.

While keeping customers in the shopping park for longer is clearly beneficial to sales, what about the issue of parking control and enforcement? “Since April we have been able to use our number plate recognition system to help us gather data on the 390,000 cars that visit the park each month, and have very little problem in the enforcement of disabled and parent children parking rules,” Matthews explains.

Finding the funds to offer free parking can be tough, if not impossible, particularly in the current economy. But for Oldham town centre, where rates were slashed for on-street parking last month, funding was readily available. The credit crunch war cabinet, established with the Oldham Town Centre Partnership, contains a rapid intervention fund to support sectors of the local community through the recession. Using money from the fund, the council was able to cut most charges in half and extend the maximum stay to two hours at £1.50.

The council was forced to lower parking charges after local retailers argued that current levels were discouraging customers from visiting their shops. Councillor Lynne Thompson, cabinet member for finance and resources, explains that revising parking charges in the town centre was a top priority.

“It is crucial, especially during the credit crunch, that Oldham Council listens to and acts upon the genuine concerns of traders and residents who use the town centre on a daily basis,” she says.

“An important part of that was to identify ways that we could intervene to play a positive role in helping secure the future of independent local traders. We’re confident, based on what traders and shoppers have told us, that slashing these charges will help promote the health of the High Street.”

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