A 98% license plate recognition rate sounds impressive. But is it really enough? In day-to-day parking operations, every percentage point matters — especially when it comes to revenue and the long-term efficiency of a parking system. In this article, we break down why it pays to look more closely and how operators can avoid hidden losses.
Content
Why Recognition Rates Are Often Underestimated
The Hidden Loss: A Simple Calculation
What Decision-Makers Should Focus On: Three Practical Tips
Tip 1: Look Closely at the Technical Fundamentals
Tip 2: Get Insights from Parking Operators
Tip 3: See License Plate Recognition as the Foundation — and Let Software Do the Rest
Why Recognition Rates are Often Underestimated
Many providers advertise high license plate recognition rates. But the difference between 98% and 99.8% is far greater than it appears. In real-world parking operations, that 1.8% gap can translate into thousands of euros in lost revenue year after year. What’s often overlooked is how small differences in recognition accuracy quickly add up when multiplied across a large number of parking events.
Lower recognition accuracy also comes with indirect consequences, such as increased support workload and a poorer user experience. All of this costs time, money, and trust. If a system fails to reliably capture (nearly) every entry and exit, occupancy and usage data become less accurate—or even misleading—making it much harder to optimize capacity effectively.
The hidden loss: A Simple Calculation
What does a 1.8% difference in recognition accuracy really mean in day-to-day operations? A simple example makes the impact clear. Let’s take a mid-sized parking facility with around 250 parking events per day and compare an error rate of 2% with one of 0.2%.
Scenario 1: 98 % recognition accuracy and 2 % error rate
At a 2% error rate, five parking events per day go unrecorded. With an average parking fee of €6, that results in €30 in lost revenue per day, €900 per month, and €10,800 per year.
Scenario 2: 99,8 % recognition accuracy and 0,2 % error rate
At a 0.2% error rate, only half a parking event per day is missed on average. At the same €6 parking fee, this adds up to €90 per month and €1,080 per year in lost revenue.
The difference between these two scenarios amounts to €9,700 per year — driven by a single factor: recognition accuracy. For busy parking facilities or operators managing multiple sites, small percentage differences like this can quickly translate into five-figure revenue losses over time.
Looking for a simple and efficient parking system? Get in touch with us — together, we’ll find a solution that fits the specific requirements of your parking facility. Contact Arivo now
What Decision-Makers Should Focus On: Three Practical Tips
Choosing the right license plate recognition system has a direct impact on the long-term profitability of a parking facility. These three tips help decision-makers make informed choices — and avoid costly surprises down the line.
Tip 1: Look Closely at The Tecnical Fundaments
System quality isn’t defined by software alone. The underlying technical setup is just as important. Key aspects to consider include:
- Reliable recognition at higher speeds: High-quality systems can accurately recognize license plates even when vehicles are moving faster — ideally at speeds of up to 50 km/h. This is especially relevant for free-flow access points or straight approach roads.
- Advanced multi-scan recognition technology: Rather than relying on a single image, robust systems use multiple scans to determine the most accurate result. This helps reduce errors caused by challenging conditions such as sunlight, shadows, or reflections.
- Automatic detection of driving direction: The system automatically identifies whether a vehicle is entering or exiting, ensuring that parking events are recorded and assigned correctly.
Tip 2: Get Insights From Parking Operators
Decisions are often driven by numbers, data, and facts. But looking at comparable projects can be just as important, as they reveal how a system performs under real operating conditions.
Ideally, review parking facilities with similar setups — whether free-flow or gated — comparable use cases, and similar traffic volumes. If possible, park there yourself. Experiencing the process first-hand offers valuable insight from the customer’s point of view.
Equally valuable is direct feedback from reference customers. Conversations with operators provide an honest look at daily operations: How reliable is the system? How accessible and responsive is support? How are issues handled in practice? And how easy is it to position or adjust the cameras when needed?
Tip 3: See License Plate Recognition as the Foundation — and Let Software Do the Rest
A high recognition rate is the starting point for digital parking operations — but it’s only the beginning. The real value of license plate recognition comes from the software behind it. By automating tasks that were once handled manually, the right software reduces day-to-day effort and enables efficient, scalable operations.
A well-designed software platform should deliver the following capabilities:
- Flexible parking permissions and user groups
Parking permissions can be easily created and managed for employees, suppliers, or specific customer groups. Different long-term parking agreements can also be configured with individual usage rights, time restrictions, and location-based rules. - Complete operational transparency
Effective software provides a clear, 360-degree view of parking activity — including current occupancy, available and occupied spaces, recognized license plates, and the split between short-term and long-term parkers. - A foundation for fast, digital customer support
By combining license plate data with real-time system insights, support teams can resolve inquiries quickly and remotely, without the need for on-site intervention. - Integrated payments and simplified accounting
Built-in payment functionality removes the need for separate contracts with payment providers. Registered short-term and long-term parkers are billed automatically via a customer portal, with parking fees collected once a month using the stored payment method. Automated reconciliation and efficient cashback management further simplify accounting. - Centralized, digital management of tariffs and rules
Pricing, discounts, and rules can be adjusted at any time and applied instantly across the facility. Unpaid parking events are tracked automatically, reducing manual follow-up.
The key takeaway: license plate recognition alone doesn’t make a parking facility digital. It’s the combination of accurate recognition and thoughtfully designed software that turns data into automated processes, better customer experiences, and measurable business value.
Looking for a comprehensive solution to digitally modernize your parking facility and run it more efficiently? With over 1,200 projects delivered, we know what it takes. Get in touch with us — together, we’ll find the right solution for your parking operation. Contact Arivo now
Conclusion
Effective parking management starts with the right decisions. Choosing data-driven, field-tested license plate recognition systems lays the foundation for smooth day-to-day operations. That’s how operators unlock the full potential of their parking facilities — and prevent revenue losses before they arise.
