In middle of the crisis, 2 opposite business visions are facing eachother
This article is written by Dimitri Antoniades
Today I will say bad things about competitors. I believe it is well deserved 😈.
The brutal halt of (almost) all activities during this sanitary crisis has highlighted many management differences among companies, whether they are in debt or not, well managed or not.
In the small world of companies offering airport valet-parking services, important gaps are now to be seen.
In recent years, many newcomers appeared on this niche, some of them with strong ambitions. As most of our clients know, Easy Parking has since its creation always had at heart a very strong ambition in terms of quality of service, but has never wanted to expand geographically, preferring staying in Nice region. We emphasize personalized contact, provided by drivers 100% dedicated to their company, that is to say to their customers.
For all of our competitors, appeared many years after our creation (Easy Parking was born in 2004, many years before any other player), many mistakes have been made, some of them at high cost.
3 explosive ingredients can be observed :
- Unsustainable debt : with capital-risk access at new highs those recent years, due to a search for ROI more and more difficult to find on traditional markets, it has been very tempting for newcomers to look for these types of investors. Even though this doesn't lead to debt strictly speaking, knowing that investors receive large parts of those startups' equity in exchange for their investments, consequences when business turns south can be dramatic. Indeed, when business is bad and expenses exceed revenues by far, continuing operations are only made possible by increasing cash contributions. The CBR (cash burning rate) grows higher, and inevitably comes the moment of truth : despite metrics focusing on volumes instead of quality or profitability, shareholders can quickly become reluctant to bring more cash. The ultimate consequence is the end of operations, going through drastic cost reduction programs and a vicious circle leading to quality deterioration. All of this leads to clients receiving a poor service.
- unprofitable business model : by focusing on volumes in the metrics to please shareholders-investors, such startups are in necessity to grow very fast, often much too fast. To achieve that, they face existing players and have a price discount as only leverage. This strategy is of course very dangerous, not only resulting in bringing the market downwards, bringing value to those customers who only look at price (and hence poor quality), but it also creates a vicious circle of financial losses which again creates the very conditions for the end of those models. Except for very rare cases where fixed costs can be absorbed by very high volumes, it is clear that when activities need a great human intervention, like with valet-parking services, especially in countries where manhours are expensive, those costs being essentially proportional to the activity don't create the desired scaling effect. This is the best ingredient for end of operations at a moment or at another. At the time of writing, we already witnessed some of booking platforms disappear.
- A miserable service : the third evil ingredient is of course linked to the 2 previous ones, and is its direct corollary : a poor service, getting poorer and poorer. All the benefits in terms of price the customers received are immediately lost when those same clients are now confronted with long waiting times at the airport, drivers under pressure, bad organization, put simply : a non fulfilled promise. Those bad experiences are the beginning of the end for those companies confronted to those types of failures.
At Easy Parking, we carefully avoid all those troubles. Our company, which stays at a human size since its beginning, closely managed without any debt burden, has been able through the years to get a very loyal customer base who never looked at other player. We even were able to convince some of our competitors' unhappy clients, who now have understood that a right service has also a right price. This price is the one we propose through various attractive offers, especially to our very regular clients. A price that has remained unchanged (for the parking and valet-parking fees) for 8 years !
So do not make any mistake in choosing the wrong provider : choose the one that's here to stay, who clearly chooses the customer service before anything else. Our main reward is our customers'satisfaction, and it's only thanks to them that our great adventure can continue. Thanks to all of you !