MEEM5001 Enterprise Engineering Strategy

Parking Guidance System

Parking City
Group Member:
Chan Chun Kit (50115211)
Cheung Chi Ming (50165054)
Kwong Yee Fai (50177772)
Lai Chung Wing (50276497)
Sum Kai Yiu (50369026)
Yiu Chi Kan (50524565)
Course Instructor: Dr. John K L Ho
 Company Background

• A newly established engineering company in HK

in providing effective parking guidance system for
all types of parking facilities.
• Shareholders of the company are graduates of City
University of Hong Kong.
• No experiences in business, but the system is
creative & able to meet the customers’ needs.
 Mission Statement

• To be a pioneer for providing efficient,

competitive technology and engineering
services to multi-storey car parks through
application of parking guidance system.
 Goals
• To recommend & promote the use of innovative
parking guidance system in Hong Kong.
• To optimize the use of parking spaces & reduce
the time in searching free parking space by
introducing parking guidance system.
• To gain profit for the newly established company
in HK on a 39% rate of return in the first three
year of business.
 Objectives

• Guide the driver to find a parking space more

efficient & convenient.
• Optimize the use of car parking spaces
• Provide a long term car parking space solution for
users & operators.
• Prevent a long queue of cars from forming at the
entrance point
 Environment Analysis

• Finding a space in a car park can

be difficult and stressful
• Reduce the time of searching space
in order to reduce parking time
• Look for a solution for reduce air and noise pollution
from vehicle in urban area
• No similar parking management system in HK
• Suitable for multi-storey car park in crowed district
e.g. Central, Mongkok, etc
 Environment Analysis

• Many car park developers:

- Improve the facilities
- No idea to implement the system
- Look for a solution for reduce
traffic problem outside highly-utilized car parks
- Seek for improving the usage efficiency
- Seek for efficiency and flexible management system
- Increase the rate of filling parking space
- Improve customer service and customer
satisfaction
 Market Survey

• Conduct market survey by questionnaire

• Apply Kansei Engineering (KE)
- investigate the driver’s feeling towards car parks
- to identify the system’s design
• Totally 41 questions
• 5 points Semantic Differential
(SD) scale for rating
• Sample size: 150 drivers
 Market Survey
• The four main parts in questionnaire:
Part 1: General opinions towards car parks
Part 2: Opinions about different parking
guidance systems.
The proposed components involved:
- Auto-allocation of parking space
- Parking guidance indicator
(Numerical indicator, Electronic display board)
- Indicating light for parking space
Part 3: Overall opinions towards the system
Part 4: Personal information
General opinions from survey’s results:

• Most of respondents have experience of

parking vehicle in highly-utilized car parks

- They felt difficult and annoying when

looking for parking spaces
- They don’t satisfied with the
current parking indicators
- Some of them considered the
time taken in searching for parking spaces
General opinions from survey’s results:

• Parking guidance system can reduce the time

looking for parking spaces
• Parking guidance system can
reduce the time taken for vehicles
entering the car parks
• There is a need to install a parking
guidance system in highly-utilized car parks
 Conceptual designs of parking guidance system

• Based on survey’s results:

- Most of respondents don’t like the computer
assigning the packing space to them
- They like numerical indicators
more than electronic display
board at the main entrance
and each storey’s entrance
- They thought that too much information
will distract their concentration in driving
- They are welcome to install indicating lights
for parking spaces
Key benefits for Drivers, Citizens and
Developers

For car park developers:

• Enhances customer service/customer satisfaction
• Increased rate of filling
parking spaces
• Improved the profit
• Prevented excess queues
at car parks
Key benefits for Drivers, Citizens and
Developers

For drivers and citizens:

• Improved traffic flow
• Improved road safety
• More convenient to drivers
• Reduced parking time
• Reduced atmospheric and
noise pollution
 Company Profile - Strength
• No competitors
• Cost effective for large scale multi-storey
car park
• Easy to install
• Low maintenance cost
 Company Profile - Weakness
• No experience due to no such system in HK
• No experienced staff
• Uncertain in actual demand
• No well known brand name
Identified Opportunities
• No competitors, profit margin is large
• Many cars in HK, but no enough
parking space
• Multi-stories car park is arising in HK
• Resurrection of property market, large shopping
mall will increase
• Government introduces pedestrian zone, this
reduces public parking spaces in crowed district
• Future development in mainland China, system
can be applied in large city and result in gaining
more profit
 Identified Threats
• Few people will use the car
park if parking fee is high
• Indirectly affected by
poor economic environment
• Easy replaced by other high/new technology
• Property developers are not rare, their
decisions will affect the company
development
Organization Wheel

(3)

(2)

(1)

Customer
Framework of Organization

• 1.) Core Target

– Customer: carpark management companies, facilities
management companies of large shopping malls etc.
• 2.) Company Development
– Organization: All founders are partners
– Teamwork: Partners + In-house staff
– People: Services Team (on-site, remote and hotline
support)
Framework of Organization

• 3.) Business Development

– System Design : simple but innovative,
new system for car park management in
HK, suitable for multi-storey car parks
– Customer Services : meet customers’
expectation through questionnaires
– Assembly & Test : local design
– Operations : in-house staff
Quality Management
• ISO 9000 certified
• EMSD’s approved system design
• All technicians are registered electrical
workers
• All components & parts are RoHS & WEEE
compliance Product
 Develop & Evaluate Strategic
Alternatives
• Two Strategic Alternatives for Operation:
1.in-house engineering services
2.completely out-sourcing

• Problems on Strategic Alternatives:

1.control of quality
2.communication
3.competition
4.coordination
5.costs
 Alternatives for Operation
Strategy of In-house Services
Pro
* have own facilities/equipment
* quicker reaction to problems
* better control
* good communication
* have own facilities/equipment
* higher business security
Cons
* high set up cost
* high training cost
* cost on own facilities/equipment
* no external technical support
* complicated management
 Alternatives for Operation
Strategy of Out Source Services
Pro
* low set up cost
* low training cost
* less own facilities/equipment
* external technical support
* trained personnel available
* flexible
Cons
* loss of direct control
* quicker reaction to problems
* readily fixed costs
* hidden costs
* risk
Evaluation of Various Strategies
Alternatives of Operation
Management Strategies
In-house Staff Out-sourcing
control of quality  
communication  
competition  
coordination  

costs 
 Technology Background
Parking Guidance System
A displaying system that provides the latest parking information and
directs the drivers to free parking space along the shortest possible
route
 Technology Background
Vehicle Detection Technology

Ultrasonic Object Detector Technology

Inductive Loop Detector Technology

 Inductive Loop Detector
• A coil of wire is buried under the parking
lot and connected to a roadside control box
Ultrasonic Detector
 Ultrasonic Detector
- Install in the ceiling on each parking lot
- Ultrasonic frequencies (25.8kHz or 24.7kHz)
- To detect the presence of car in the
corresponding parking lot
- LED is integrated in detector
• to indicated two possible states
Free (Available) or Occupied
- Low construction/installation cost compared
with inductor loop detector
 Ultrasonic vs. Inductive Loop
Criteria for comparison include:
Data accuracy, Environmental effect, Reliability, System
expendability, Cost and Ease of installation and maintenance.
**
Ultrasonic Inductive loop
Data accuracy Good (98% or above) Good (98% or above)

Environmental Effect Low Low

Reliability Good Good
System expendability Good Medium
Ease of Easy Difficult
installation/maintenance
Construction cost Medium High
 Vehicle Detection Technology
• Ultrasonic Detector is selected
in our parking guidance system

Reference:
** Naoyuki Ushio and Toshiyuki Shimizu, “Loop vs ultrasonic
in Chicago: Ultrasonic vehicle detector field test isolating
diffused reflection and enduring harsh environment”, 1997
System Architecture of Parking
Guidance System
System Architecture of Parking
Guidance System
System Architecture of Parking
Guidance System
Digital Display and Signage
 Financial Analysis
Source of Funding

Friends Easy to borrow

Depends on degree of friendship

Bank Loans More flexible

High interest rate for small business

Government Tailor-made loan scheme

Funding Scheme
Strict application requirement
 Financial Analysis

Initial Investment HK $ Annual Expenses HK $

Office Hardware 80,000 Direct Cost
Computer Software with license 80,000 Labor salary 648,000
R & D cost 60,000 Other Direct Cost 30,000
Marketing Promotion 50,000 Indirect Cost
Working Capital 50,000 System Maintenance 10,000
Quality Control & Testing 10,000 Marketing Promotion 10,000
Taxes and insurance 60,000
Other Indirect Cost 30,000
Total 330,000 Total 788,000
 Financial Analysis

Net income from each project HK $

1. Ultrasonic detector 126,250
2. Microprocessor-based controller 7,500
3. Equipment rack/housing for the controller 1,500
4. Central workstation sever computer 12,000
5. Parking guidance system software with 1 year license 28,000
6. Hubs/Routers 1,000
7. Building service provisions 85,000
8. Related shielded cables 54,400
9. Uninterruptible power supply 27,000
10. LED display board 13,000
11. Consultancy and installation & testing 65,000
Total cost for 1 project 420,650
 Financial Analysis
Income Calculation:
Markup price for each project: 40% on the total project cost

Selling Price = HK$ 420,650 X 1.4

= HK$ 588,910

Total Income from *projects each year:

Total Income = HK$ 588,910 X 5
= HK$ 2,944,550

* Assume 5 projects each year

 Financial Analysis
Net Profit for each project:
Consultancy Income: 80% of the project cost category 11
Consultancy Income = HK$ 65,000 X 80%
= HK$ 52,000
Markup Profit = HK$ 168,260

Total Profit for each year = HK$ (52,000 + 168,260) X 5

= HK$ 1,101,300

Net Profit = Total Profit – Total Expenses

= HK$ 1,101,300 – HK$ 788,000
= HK$ 313,300
 Financial Analysis
Payback Period:

Year Cash Inflow Cash Outflow Net Cash Flow

HK$ HK$ HK$
1 440,520 1,118,000 (677,480)
2 1,101,300 788,000 (364,180)
3 1,101,300 788,000 (50,880)
4 1,101,300 788,000 262,420

Payback period:
3 + [50,880/(1,101300 - 788,000)] X 12 = 3 year and 2 months
 Time Schedule
Tasks Month Month Month Month Month Month
1 2 3 4 5 6
Stage 1: Requirement Study (30 days)
(1.1) Operation and Process Review
(1.2) Technology Review
(1.3) Requirement Checklist Finalization

Stage 2: System design and development (100

days)
(2.1) Design of System
(2.2) Coding of System
(2.3) Testing version/ Demo Version Roll Up

Stage 3: System testing (60 days)

(3.1) Design of Testing Plan
(3.2) System Acceptance Testing and Pilot Run
(3.3) System Fine-tuning
(3.4) System Final Version Release

Stage 4: Training and marketing (60 days)

(4.1) Promotion Start
(4.2) System Training for Supporting Staff
 Conclusions

• Strategy plans are fully achieve the mission statements &

objectives

• The functions of the Parking Guidance System is based on

the customers need

• No market competitor as a result of high profit margin tends

to shorten the payback period
Question &
Answer
Thank You !