[Business Growth] Resolve to Become a Wealthy PCO

One thing we’ve noticed in the pest control industry is that there are a lot of small companies that have been in business and remained small for many years. There also are companies that have grown tremendously in a few short years. There is a difference in the thinking of a small company owner and the owner of a growing company. The growing company owner not only has to be an expert in pest control, he must also be an expert in management. He must be able to manage people, a growing customer list and the detailed information that flows in and out of his firm.

The pest control business is not a high-margin business — it is a moderate-margin business, where you generate high profits from customers who use your services on a scheduled, recurring basis. In other words, you don’t hit a home run with each customer and move on to the next as perhaps a car salesman or a real estate agent might. You foster a relationship with your customer that grows based on your ability to meet their needs in terms of quality and perceived value.

SUCCESS STARTS WITH GOALS. Being dissatisfied with your current situation is a great place to start: You already know what you don’t want.

In order to determine where to start, you must understand business anatomy. Careful consideration of the systems that make up a business, setting goals and working toward them are keys to success. Goals should be specific: Resolve to write 100 new service contracts, or make $10,000 in new sales by the end of the first quarter — not just to “grow your business” or to “sell more services.”

The systems that make up the anatomy of a business are:

• Sales and Marketing
• People Management
• Operations
• Accounting

SALES AND MARKETING. It’s not a coincidence that we started with this area. Without company sales, you don’t need people, there is no operation to run and there is nothing to account for. You need to project what your company’s sales will be. This allows you to figure out how many people you will need and, in turn, drives the other systems.

Many pest management firms service a lot of low-end customers who have one foot in the grave and can’t operate their own businesses profitably. They expect you to work for little and suck you into this type of business model. Low-end customers go in and out of business all the time. What does this mean to the PCO? You always have collection problems and problems paying your own bills.

What you need here is a plan — a plan to choose your customers wisely. You have to do your homework and trust your instinct when taking on a customer. Your time is too valuable to waste servicing and trying to collect money from dead-beat customers. The key is to hand-pick the customers that you want to service.

PEOPLE MANAGEMENT. Are you dissatisfied with your employees? You can’t build a business alone! If you build your team in a thorough and methodic manner, you increase the likelihood of greater success. Employees need a plan and a vision; they need to understand what you expect of them and what they can, in turn, expect from you. By creating this type of well-defined system, feedback is almost as easy as reading results.

OPERATIONS. When you’re a small company, what you do is pest control. Maybe you’re a one-man show, so you organize yourself and your truck. As you get bigger, just as important is how you organize your office. Think about the workflow of your business and how that impacts your office and overall operation.

Remember, there are two areas to consider in office set up: One is the physical setup: office space, desks, chairs, water coolers, phones, fax machines and computers; the other is the dynamic flow of information. This means incoming calls, voicemails, e-mails, instant messages, intercoms, paperwork and other such activity-driven facets of the office — including routing your technicians for efficiency.

ACCOUNTING. An accountant does far more than fill out tax returns. The accounting function in the successful pest management professional’s firm allows the PCO to make sound business decisions about expansion, cost reduction and efficient operation of his firm. The management accounting function provides controls that ensure financial transactions are recorded properly and provides the information that allows the successful PCO to make those decisions based on hard facts.

At a minimum, the internal procedures at a pest management firm should include the use of financial statements, a well-supervised bookkeeping function, a formal budgeting procedure and an aggressive accounts receivable management program.

CONCLUSION. As you grow your pest management firm, you need to successfully transition from doing the work to managing the work. This is one of the most difficult things that you will need to do in growing your business. The key to being successful in this endeavor is to organize your business into its functional areas, set goals for each and execute, execute, execute. Resolve to start doing this today.

The authors are principals of PMP Wealthbuilders, Newton, N.J.

About PMP WealthBuilders

PMP WealthBuilders is a firm dedicated to helping pest management professionals increase the value of their firms using the company’s flagship product, the PMP WealthBuilders System.

The system is a turnkey program that includes marketing, office systems, accounting and employee management manuals and a series of “roll up your sleeves and show you how it’s done” CDs. The system is patterned after the same techniques that were used to build JP McHale Pest Management from a few hundred thousand dollars in annual sales to a pest management firm with more than 100 employees and annual sales of more than $10 million. 

The firm is the brainchild of James P. McHale, president of JP McHale Pest Management; Daniel S. Gordon, CPA; and Jonathan Yee, MBA. McHale and Gordon have done extensive work in the pest management industry. Yee received his MBA from Boston University and comes from a “Big 5” global consulting firm where he served as a business consultant. Yee now applies his corporate experience towards fostering small business growth working with Dan Gordon in his business consulting firm, Wealth Depot.

More information about PMP WealthBuilders can be found at www.pmpwealthbuilders.com or by calling 973/300-0288.

Editor’s note: This is the first in a series of articles based on the PMP WealthBuilders’ business building system. In this and future articles the authors will describe a variety of methods that will help pest management professionals make even more money and profits.

Need help coming up with your business-related resolutions? See www.pctonline.com/newyear for four resolutions to help you have a more successful business in 2008.