Just a quick heads up that our meeting with Smart Parking starts in half an hour. If you can't attend live, please add any questions here and i'll be sure to put them to Paul.
For those who have attended / watched the meeting with Paul Gillespie earlier today what were your thoughts?
Seems most things are heading in the right direction with SPZ tracking ahead of their 1500 site target by 6 months and seeing terrific growth in NZ and Germany.
There was a great question asked about the decisions to look into new markets, and why they don't just focus on doubling down into their growth markets such as Germany and NZ given they have only just touched the surface here. Was I the only one who felt the question was side stepped a little (I'll need to watch the replay to see if I missed something).
Maybe I'm being a little to cynical here, but I did ask a question on sales team retention and how the sales team are incentivized. Having worked as a Corporate Sales Executive in many small startup companies both locally and internationally one of the biggest challenges typically is internal culture, as well as whether the sales team and management are aligned. Paul alluded to the fact that there is high turnover in the sales team but also covered this by stating the turnover is typically based on who can perform and who can't. This concerns me a little, because Glassdoor doesn't tell a pretty picture from an internal culture perspective (appears most of the challenges are in the UK). When this sales growth continues, and an increasing disconnect occurs between management and people on the street who are selling, the house of cards can come falling down fast.
Does anyone here share similar concerns, or am I just being overly cynical? I worry that a revolving sales door means customers are constantly being re-assigned new Account Managers, and in the long term this can really diminish customer satisfaction. Perhaps I'm jaded from past experience.
Keen to hear if this is a concern to anyone else?
Yours faithfully,
McLovin
@Strawman Great chat on SPZ in the latest Motley Fool podcast this morning. Made for good listening after finishing my 10km run this morning!
I think you made a great point about selling to customers and even with a great product the sale can be difficult if the customer has other priorities, no room in the budget etc. I think SPZ does a fantastic job getting around that problem with their go to market of not charging their clients directly. SPZ bear the up front cost of camera and signage installation and in return collect the on-going parking fines.
In this environment I think the ability to go to a retail/hospitality customer and say we can improve your foot traffic by X% and the best bit is there is no upfront cost or capex required. Hard for customers to say no really.
@Byrnesty, great pick up mate, I hadn't come across this. SPZ is of my largest and highest conviction holdings, so this one hurts.
This article provides more clarity, and even mentions SPZ.
'Transport and Main Roads Minister Mark Bailey said that from next Monday the companies, including ASX-listed Smart Parking, will no longer be able to access the Transport and Main Roads Department database to obtain details including home addresses of vehicle owners and other personal information.'
A separate article by Brisbane Times indicates the halt will commence next Monday (20/02) and will effectively end the sector’s ability to enforce minor fees for their ungated car parks until to-be-decided changes arrive later in the year.
First and foremost, this is a significant risk for SPZ. It will be interesting how management handle this, with Queensland being SPZ's largest (and only?) market in Australia. In the APAC region in FY22, SPZ issued 35,000 parking breach notices -- around 15,000 of these were in Australia (Queensland). So it is a big part of its APAC division. As a reminder, SPZ earns an overwhelming majority of its revenue (over 75%) through parking breach notices, so this has a massive impact on its Queensland-based business until changes occur later in the year. That said, there is nothing to suggest the changes will be positive for SPZ so this remains one to watch until further information comes to light. It also brings into question how their Brisbane office (and staff) handle this and what the company's action will be. Will they get rid of their staff temporarily?
While this one hurts, it is not catastrophic, in fact far from. While there were around 15,000 breach notices issued in Queensland in FY22, in the UK alone -- SPZ's largest market -- they issued more than 500,000. SPZ also has presence in NZ and Germany, although the latter is much less developed than Australia/Qld. I would estimate total breach notices in Australia account for around 2-3% of SPZ's total breach notices. What it does do is demonstrate legislative risk for SPZ -- without the ability to access registration details (only possible with favourable legislation) SPZ and their business model can't function.
Interested in the thoughts of others here.