[Termite Control] the ten-year niche

Profit potential for termite control is on the rise — it has been for 10 years. In fact, PCT’s State of the Industry report in October showed that termite control is the pest control industry’s second largest growth market, with 78 percent of companies providing it as a service offering.
Ten years ago, termite baiting sparked that movement. For pest management companies that carved their niche in termite control and made the transition to the marketplace’s first termite baiting technology, many have experienced enhanced performance and the accompanying profits. They’ve also learned a thing or two about how proven colony elimination provides value to their businesses, especially in regards to homeowner satisfaction, marketing approaches and employee productivity and retention, according to manufacturer Dow AgroSciences.
In the early 1990s, termites accounted for about 15 percent of the pest management portfolio of Mother Nature’s Exterminating, a single branch, family-owned business in Tulsa, Okla. Now, termite control is responsible for more than 70 percent of the company’s total revenue.
“Termite baiting changed the way we do business. Hands down,” said Theresa Angel, vice president of Mother Nature’s. “Before baits, termite treatment options were limited. We weren’t satisfied with the results we delivered, even though we were working with the best products on the market. Every spring, we knew that we’d be back at customers’ homes retreating.”
When Angel first heard about termite baits, she went straight to the source. “I called Dow AgroSciences once a month, letting them know that Mother Nature’s wanted to sell the Sentricon® System,” Angel remembered. After repeated attempts, Angel put together a proposal that put her company on the line, promising that Mother Nature’s would install the baiting system at 500 sites within a year’s time.
Persistence paid off and Mother Nature’s delivered. In the first year, sales nearly doubled the previously benchmarked figure, with Mother Nature’s installing the Sentricon System at 929 sites. The following year, Mother Nature’s enlisted an additional 1,000+ sites.
From a business management perspective, Mother Nature’s was at a turning point. On one side were 15 employees, one termite technician and a 1,000-square-foot headquarters building. On the other side was profitable growth.
Today, Mother Nature’s has nearly 75 employees, 14 termite technicians and a headquarters building 15 times the size of its previous facility, measuring in at 15,000 square feet. By the numbers, Mother Nature’s is standing tall, but a good part of the company’s success can be attributed to the business model it put in place for quality assurance and productivity.
“Early on, we hired a team of quality assurance inspectors to randomly check homes on one of the 14 service routes that our technicians run,” Angel explained. “The team has a number of ways to assess how our technicians deliver the standard of service that we’re committed to.”
In short, all it costs Mother Nature’s to ensure productivity is a penny.
“One method of ours is to place a penny in the bait station and see if the technician catches it during his inspection. We then check that technician’s site report to see if he makes note of the penny,” said Angel.
Mother Nature’s has kept a concise history of all sites and inspections since its founding. The penny technique is one way to validate that technicians are thorough and effective in their site inspections.

ON THE RECORD. Concise record keeping isn’t just for auditors — it gives companies a personal touch, especially in the pest management industry where a client base often consists of multiple generations.
“Word of mouth is huge. Some of our customers go back three or four generations,” said Jay Nixon, president of American Pest Management, a company celebrating its 80th anniversary this year with three locations in metro Washington, D.C. To keep track of services performed and site histories, American Pest Management uses log books.
“We use this captured information from the log books as a communications piece with our customers,” Nixon said. “Each entry demonstrates our ongoing relationship with them and our commitment to keeping their property termite-free.”
For Mother Nature’s, another reason for good record keeping is to capitalize on real estate transactions when houses change ownership. “We look to records of every house we’ve ever treated to help sell new homeowners on the preventative treatment benefits,” Angel added.
 
LESS IS MORE. For companies committed to the bait movement, less is more. For example, many cite how items, such as lower fuel costs, limited use of active ingredient, lower liability insurance and a decrease in the number of retreat and damage claims have helped them build stronger bottom lines.
“Ten years ago, our fleet primarily consisted of large pick-up trucks,” said Paul Felker, president of Bug Out Service, Jacksonville, Fla. “Now, we use smaller trucks because we have less large equipment to haul around. Lately, it’s been especially beneficial considering today’s fuel costs.”
“We previously had four big rigs, now we have none,” added Jay Nixon, commenting on how his company has benefited from a decrease in large capital expenditures.
Fleet sizes and rising gas costs have also prompted many companies to take a closer look at productivity and see how much a technician can accomplish in a given setting.
The capability to monitor termites electronically has also helped Bug Out Service capitalize on efficiencies related to productivity and fuel costs.
“Electronic termite monitoring has helped our technicians accomplish more with the time they have,” Felker added. “It’s also made the quality of the job better and helped us retain talent.”
“In our opinion, electronic termite monitoring is most advantageous for large properties,” said Tony Massey, executive vice president of operations for Massey Services Inc., Orlando, Fla.
Mother Nature’s is currently in the process of transitioning large and commercial properties over to electronic monitoring, aiming to have all sites converted within the next year and a half. According to Angel, Mother Nature’s will “soon be realizing significant time and fuel savings from a technician being able to park his vehicle at one location and cover the entire grounds before driving to his next destination.”

CLAIM DRAIN. Damage claims seemed to peak in the early 1990s. “It wasn’t simply the rising number of damage claims that concerned us — it was the actual dollar amount of the claims,” Massey said. “Something needed to be done.”
After taking a close look at liability on the books, Massey Services developed a re-inspection program, which instituted a zero defect termite treatment policy, doing everything it could to stop and prevent termites. Along with its shift to baiting technology, Massey Services pioneered the concept of pest prevention — a preventive environmental management program that eliminates the conditions, avenues and sources of pest infestations. Unlike pest control, pest prevention is a proactive treatment approach.
Ever since, Massey Services has more than turned a profit, with the company’s termite revenues increasing by about 15 percent each year.
As the number and dollar amount of claims declined, pest management companies were able to devote more attention to their customers and growing their profits. “You’ll see it reflected in our television advertisements. We’re confident in our ability to provide proven protection,” said Felker at Bug Out Services. Pest management professionals also placed new trust in their service warranties.
“In 1995, we instituted a policy that promises to pay homeowners for any termite damage found to occur after we issue a colony elimination declaration,” Angel added. “In 10 years, we’ve never had to put that policy into play.”

BUILDING A BUSINESS. “It was hard to come into work,” remembered Felker, explaining the mentality of pest management professionals in the early 1990s and their frustration with the limited amount of treatment options. “Thankfully, that all changed. Today, our technicians feel like they accomplish more.”
Like Bug Out Service, Mother Nature’s has also expanded the role of technicians to help advance their careers with the company. “All technicians are trained in sales. For them, it provides professional development and the building blocks to move up in our organization. For us, technicians are able to provide a one-two punch while on site, leading to more sales and thorough communication with customers as a result of their enhanced training.”
Similarly, one of the core principles for Massey Services is the belief that “Our people make the difference.”
“We have a strong focus on training, teamwork and a commitment to service excellence,” said Massey.
While Massey Services is progressive in offering strong employee benefits, Tony Massey pointed out that money isn’t everything. “Team members want to know their actions make a difference. We place a high importance on familiarizing our team members with our company’s core values and reinforce to them that ‘YOU are the company.’ That way, when they are in a position to make a decision, it is based on our workplace culture and core values. As long as they understand and embrace that, they’ll always make a sound decision.”
Needless to say, the advent of new technology brought about a new way for pest management professionals to look at termites and manage their businesses.
“The Sentricon System is something you can build a business around,” Felker said. “With the termite treatment method we chose 10 years ago, we’re providing homeowners peace of mind. As a company and as an industry, I feel like we’re really making a difference in their lives.”

GREEN MARKETING PAYS OFF

Numerous companies have embraced the environmental movement and used it to their benefit. Whether it’s a company that takes its namesake from Mother Nature herself, or a company located in Florida, a prominent water conservation state, going “green” has made a strong impact on service and marketing approaches. It’s also meant that pest management companies are able to place a high regard on natural resources while using a treatment product that takes into consideration the well being of children and pets.
“An eliminated termite colony makes for a happy homeowner,” said Theresa Angel, vice president of Mother Nature’s, “and customer satisfaction with the way we eliminate termites speaks for itself. In fact, we have one entire street that is enlisted with the same ongoing termite protection.”
“In Florida, we’ve got a water problem, and I’m not referring to the hurricanes,” said Tony Massey of Massey Services. “It’s just not necessary to pretreat by pumping 400-500 gallons of water into the ground at each site anymore. Whenever we provide a service, we do it with as much environmental stewardship as possible.”
Throughout the years, Massey Services has received numerous awards and recognition from both state and national organizations for environmental excellence. In fact, Massey Services recently received a federal grant to explore the potential of making schools pesticide-free.