6 Ways to Create More Opportunity
There has been rapid growth in the U.S. pest control industry from a $5.6 billion industry in 2002 to today’s valuation at approximately $14 billion. People’s increasing intolerance of pests, combined with concern over the spread of pest-related diseases, expansion of urban populations, increasing government regulations and safer pest service techniques all lead to a rise in demand for pest control services. It is an industry primed for continued growth. Even investors, on Wall Street, are showing in an interest in the ROI from the recurring revenue models in pest control management, especially in the commercial segment. There’s certainly a lot of buzz around fast growth. So, how can pest control companies keep pace and create opportunity?
Today’s acquisition trend is different from mergers and acquisitions activity of the past. Typical platform acquisitions in the ‘80’s and ‘90s saw large companies who were looking to diversify their service lines and take their product into a new market. In contrast, today’s mergers and acquisitions are mostly fueled by pest companies and “pest people” looking to increase their core competency and expand their business footprint. As highlighted in a recent article in Pest Management Professional, "Over the years, the mix of players in the pest management industry has shifted from a small group of nationals, smaller regional competitors, a “big-box” retailer and thousands of local independents to a handful of multi-billion-dollar national and international brands.” There are definitely steps you can take to make your business more attractive for investment/acquisition. If you aren't looking to sell right now, these same steps can help you compete with larger companies.
So, how can small and mid-sized companies create more opportunity? There are definitely steps you can take to make your business more attractive for investment and/or acquisition:
1. Increase Recurring Services
Contract-based recurring services guarantee ROI and improve your attractiveness for investors and potential buyers. With new services such as mosquito control among the fastest growing pest segments in 2016, revenue from recurring services is not just limited to commercial accounts. The culture of pest intolerance combined with less toxic and safer pest treatments is increasing the opportunity to engage commercial and residential customers in contract-based recurring pest services for routine treatments for mosquitos, termites, bed bugs and rats and mice. You need a smart mix of revenue that is heavily weighted on routine contract-based recurring services.
2. Improve Route Efficiency
Make sure you are consolidating your routes for optimum efficiency. Reduce the time your technicians are spending between appointments and increase the number of service appointments in a day by smarter mapping. Pest control companies that can show route efficiency garner higher value. Today’s software can optimize stops to reduce drive time and respond in real-time to real-world events such as a closed road, accident or rescheduled appointment. If your technicians show wasted time spent between appointments or inefficient route mapping it’s akin to throwing money away and turning your back on more customers. Using route planning software ensures you are maximizing efficiency and productivity of your employees, and taking better care of your vehicles.
3. Deliver Exceptional Customer Service
A company with a passion for customer service builds loyalty and is a healthier business proposition. Excellence in customer service today means making sure you’re providing your customers 24/7 access to information they need on your website, or customer portal, using smartphone technology to communicate to customers, providing updates on time of arrival, uploading documents and photos while techs are in the field and minimizing inconvenience for customers. Part of your value and the value of any company you’re looking to acquire will depend on customer ratings online and customer loyalty.
4. Cultivate Positive Culture
Employee retention is consistently listed as one of the biggest challenges for pest control companies. Finding ways to maintain a positive company culture where your techs want to work for you is crucial for day-to-day operations and long-term business health. Your business will be attractive to employees if you make it easy for them to do their best work and provide them with the most efficient and practical tools. Using smart technology solutions can be a huge impact in making it easier for your employees to do their jobs.
5. Streamline Communications
Sharing information and giving everyone access to the information they need improves efficiency, transparency and productivity. Arguably, the most efficient tool for communication today is mobile. It’s ubiquitous in U.S. culture - almost everyone will understand how it works! Customers use it to find your business, and employees can use it to find their appointments, access customer information and eliminate double entry. It’s easy to use and access to schedule, book, upload notes, submit payment and solicit customer reviews all on a mobile device.
6. Demonstrate Synergies Where You Can Reduce Costs
PestPac, by WorkWave, is the leading provider of technology solutions in pest control. We are “pest people” providing solutions that help you run and grow your business. When pest companies using the same solution come together it becomes more than a strategic merger, it is a perfectly practical fit of customers, technicians and office management.
Opportunities are all around. According to a recent article in Pest Control Technology, “With 19,500 of the global pest control industry’s 40,000 operators doing business in the United States, international pest control companies are setting their sights on North America and getting involved in the action through mergers and acquisitions.”
Don’t wait for impending retirement to start working on preparing your business for sale. Work on improving your attractiveness today! In this era of rapid growth, keeping your business in the game means having visibility into your opportunities for improved efficiencies and revenue gains so that you are always prepared for growth.