“Restaurant owners in the Chinatown International District say the longer parking-meter hours that started in August,” reported the Seattle Times last week, “have cut business by as much as 50 percent.” Before the Times closed the comments section, 364 people aired their thoughts on the matter, many having based their argument on the plain-as-the-nose-on-your-face data point: Business off 50 percent.
Others pointed out that nothing all that major had changed: the $2.50 per hour rate for metered parking had simply been extended to 8 p.m. from 6 p.m., and if people had stopped coming to Chinatown to eat, they were still parking their cars there: As the Times mentioned, a “sampling of on-street parking in the Chinatown ID in September and October found the new rates are working as the city intended.”
Slap! She’s 50 percent off! Slap! She’s available parking spaces! It was Chinatown all over again.
The City Council’s Tim Burgess emphasizes that what “the city intended” is to allow more customers to park in Chinatown, not fewer. He references a study that showed, far from creating tumbleweedy curbs, parking in Chinatown has been hopping:
Parking occupancy at 7:00 p.m. was measured at 78%, right in the target range of one to two open spaces. Data from our pay stations also shows transactions per day have been consistent in Chinatown/International District since September.
Sightline has taken things further, questioning the “50 percent off” decline in business itself. After all, nothing in the Seattle Times story indicated the reporter saw anyone’s books. Celebrity chef-preneur Tom Douglas was allowed to join the protest, though he “said he couldn’t cite a specific dollar amount or percent of decline.” He was also allowed to say, “More empty spaces means fewer customers,” which is simply wrong.
It’s an interesting leap of logic that your best customers are those who refuse to pay for parking, but “more empty spaces” is simply a mistake. At issue is the frequency of empty spaces. The more frequently a space opens up, the more customers can visit your establishment. Someone who pulls up at 5:55 p.m. in front of your restaurant and parks for free all evening prevents an hourly stream of customers from pulling up afterwards.
Sightline responds: “Perhaps the reason Douglas couldn’t cite a number is that, in truth, Seattle restaurant sales shot up 5.7 percent from the third quarter of 2010 to the third quarter of 2011, when the new parking rates and hours went into effect.”
More specifically, looking at a sampling of aggregated B&O tax data from Chinatown restaurants showed this result: “in the fourth quarter of 2011—by which time the longer paid parking hours were fully in effect—gross receipts shot up a whopping 5 percent compared to the fourth quarter of 2010.”
Up five percent is not 50 percent off. Maybe the “seven community groups and almost 70 restaurateurs” who provoked the Times story can shed some light on the discrepancy. That’s not snark: Sightline used a sampling of restaurants, so there’s always the possibility their data is skewed in some way. But it would be interesting to find out whether any restaurants that did report a five-percent increase in Q4 sales year-over-year signed the letter protesting the parking meters.
I don’t understand business owners who don’t know their own numbers off the top of their heads. Or at least during an interview about the numbers. It’s a recipe for disaster. If you own a business, you better damn well know the KPIs by heart.
Also find it interesting that restaurant owners don’t understand the concept of flipping parking spaces as those are two of the few businesses whose revenue growth is built on customer churn.
We need an insider in the tax offices to leak emails revealing the conspiracy to make the Seattle Times look bad…
Unfortunately, the data cited in Sightline is cherry-picked B&O tax data representing only 14 establishments in the Chinatown / ID. Furthermore, the cherry-picked data used in that article does not reflect the neighborhood. The data used showed $2.98 million of B&O tax in 4Q11 compared to $2.84 million of B&O tax in 4Q10. This is where Sightline got the 5% increase. Govem the B&O tax rate for a restaurant at the State level is 0.471% of sales and 0.215% at the City level; assuming the $2.98 million reflects both State and City B&O tax, that implies sales in 4Q11 alone of $434 million ($2.98 divided by 0.686%) for 14 establishments! In one quarter! The largest of restaurant operations like PF Chang’s only do $3-4 million per restaurant in an entire year! So this data clearly includes some very large businesses and is not reflective of the majority of the businesses in the neighborhood!
Unfortunately, this data is a gross misrepresentation of the neighborhood.
In addition, the SDOT data citing 78% parking occupancy in Sept 2011 fails to cite the the occupancy data before the implementation of the extended hours was 89%. So in the first month after implementation of extended parking hours parking usage already declined 11% (extended hrs were implemented Aug 2011). Decline in usage is only expected to increase with time, as many people still came down to the Chinatown/ID in Sept not knowing they had to pay for parking until 8pm!
This B&O tax data is not reflective of the neighborhood’s small business. The tax data used in this article was cherry-picked and only comprises 14 establishments in the entire neighborhood. Moreover, it is skewed by some very large businesses.
The 4Q11 B&O tax of $2.98MM compared to 4Q10 tax of $2.84MM is extremely large for only 14 businesses! The State B&O tax rate is only 0.471% and the City B&O tax rate for restaurants is only 0.215%. This totals a combined B&O tax rate for restaurants of 0.686%. Assuming the $2.98MM of B&O tax used here in 4Q11 comprises both State and City B&O tax, that implies gross receipts of $434MM in 4Q11 alone! I can tell you the largest of restaurant operations like PF Chang’s only does about $3-4 million per restaurant a YEAR!
The gross misrepresentation of data here is obscene.
Gross misrepresentation? They were gross receipts. Used to illustrate in increase in sales as a proxy for customer traffic.
That’s still not perfect, which they state, but it’s a hell of a lot better than some restaurant owners who don’t know their own KPI’s screaming the sky is falling because of a maximum $5 over two hours across highly demanded neighborhoods– many with great mass transit options– like rails, which are being used with greater frequency.
But whatever, we can just freak out instead.
The B&O tax is a tax of gross sales. How can you directly say that an increase in gross sales is an increase in customers? At the end of last year, most businesess have had to increase prices by 5-10% because of increased costs (min wage increase, food & transportation, etc). This means that even if your customers dropped or at best stayed the same, you would still see an increase in sales. But do not mistake increase in gross sales as profit. last year we saw increases in food prices, some items as much as double or triple! so a 5% increase in sales would not even cover it.
How often do you guys come down for dinner in the ID? if your answer is less than twice a week, then you don’t know what businesses are going through here first hand. Please come by and see for yourself if these restaurants are all bustling with business.
I’m not denying that it’s gross receipts which do not have a direct correlation between profits nor customers.
What I am saying is using that is not a gross misrepresentation. What is a gross misrepresentation is anyone not using real data and hyperbolic statements like “BUSINESS IS DOWN 50%!”
Again: Down from when? What is your definition of “business?” Is it customers? Is it profit? Is it revenue?
At least the sightline article tries to answer the question “Has parking affected business” as opposed to the Times’ article which… I still have no fucking clue what it was trying to do, actually.
I never claimed these businesses were bustling– but I’m having a hard time believing it’s because of parking. As you stated, there has been increases in numerous other costs, restaurants ALWAYS decrease in business during the winter.
Again, I’m not disputing that business is down, I’m disputing the fact that unless one takes an intelligent look using numbers and not hyperbolic statements, then we’re all just wasting our time and not finding possible solutions.
I’m willing to bet, it is NOT parking that’s the problem. Why? I’ve heard this same shit for years and years and multiple cities. I just can’t buy it without facts.