[Top 100] 2012 PCT Top 100 List

Editor's Note: The May issue of PCT featured the PCT Top 100 list, which ranked the industry’s 100 largest pest management companies. Due to space limitations, we were unable to run several articles in that issue. Those articles appear on the following pages.

Copesan & Western Exterminator to Part Ways

Copesan Services and Western Exterminator Company, Anaheim, Calif., have announced the termination of their business relationship.

Copesan Partners learned of the disengagement of Western from Copesan on the afternoon of May 4. A press release was sent out by Copesan on the morning of May 6. “Leaving the Copesan network was a difficult business decision, having been a Copesan Partner since 1991,” said Michael Katz, president of Western Exterminator Company, in the press release. “However, after very careful consideration, we have determined that we want to refocus our service efforts on the Western Exterminator side of our business. This was solely a management decision for Western as we fully support the Copesan business model. We are committed to working with Copesan’s national clients and will do everything in our power to ensure a seamless transition.”

Katz told PCT that Western benefitted from its Copesan partnership in many ways, including having Western members serve on various Copesan committees. “When you are dealing with large national accounts, there are a lot of protocols to follow and I think we learned a lot about quality assurance through the Copesan network,” he said. “I think they have one of the finest technical committees in the industry. In a lot of ways it made us a better company.” Despite these and other benefits Katz said it was a necessary business decision because being a Copesan Partner “was a difficult piece of our business to administer properly.”

News of Western’s disengagement from Copesan has once again stirred up the “Is Western being sold?” rumors in the pest control industry, to which Katz responded, “I don’t believe that is true. I have heard those rumors about our imminent sale for many years. You know, we are being sold to Terminix, we are being sold to Orkin. I don’t look at this action any differently. Looking at this action, I can see where people might think that, but people can think what they want. This was a business decision that stands on its own merits.”

In that same Copesan press release, Deni Naumann, president of Copesan, said, “Our commitment to providing exceptional service and account management to our clients is and always will be our top priority. We are grateful that the Western team shares this same commitment and is dedicated to a smooth transition of service. We recognize that change in our service provider network may cause some uneasiness, however, Copesan has addressed similar challenges in the past and the end result is a stronger servicing network.”

When asked by PCT how other Copesan Partners would fill in the hole left by the departure of Western Exterminator, Naumann explained how Copesan’s national accounts are transitioned. “We look at our redundant service capability. So, in the case of Western, we will be making assessments as to who can provide the service portfolios; the capabilities we need, for our clients,” she said. “It’s always ‘Now that this need has arisen, what service capabilities address the clients’ requirements?’”

One of the strengths of Copesan’s unique business model is its redundant service capabilities identified in its local markets. “All of our servicing Partners are committed to Copesan’s high-touch account management approach and quality service performance standards. We’re confident that our clients will continue to receive the best of care in their capable hands,” said Naumann.

Copesan will be communicating transition details to its clients as they are finalized. The transition is targeted for completion by Sept. 30, 2012. — PCT Internet Editor Brad Harbison and PCT Editor Jodi Dorsch

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ServiceMaster Reports 1Q Results; Terminix up 9.6 percent over last year

The ServiceMaster Company, Memphis, Tenn., one of the world’s largest residential and commercial service networks and parent company of Terminix International, on May 10 announced preliminary, unaudited first-quarter 2012 results, led by a 6.5 percent increase in operating revenue, to $655 million, and a 130 percent increase in operating income, to $55 million, compared to the same period in 2011. The company’s operating performance increased 32.5 percent to $101 million compared to the same period in 2011.

“I’m extremely pleased by our first-quarter results, which reflect the hard work and continued support of our teams to grow our business rapidly by transforming our customers’ experiences,” said ServiceMaster CEO Hank Mullany. “Not only did we show improved financial results during the quarter, but we also saw improvements in overall customer satisfaction and, as a result, customer retention. “Although the first quarter constitutes only a small portion of our total year results, we’re certainly off to a strong start and making great strides in fulfilling our mission to simplify and improve the quality of our customers’ lives.”

Terminix reported first-quarter operating revenue of $311 million, an increase of 9.6 percent over first-quarter 2011 results. Pest control revenue increased 8 percent over first quarter 2011 results, reflecting a 5.7 percent increase in pest control customer counts, a $2.7 million increase in other revenue (primarily bed bug services) and a 0.3 percent increase in average annual account value.

The increase in pest control customer counts was driven by an increase in new unit sales, acquisitions and a 20 basis point increase in the customer retention rate. Termite revenue increased 10 percent over first quarter 2011 results, reflecting an 11 percent increase in new unit sales, the favorable timing of renewal revenue and a 2.6 percent increase in average price of new and renewal units. This was partially offset by a 0.9 percent decline in average renewal customer counts.

First-quarter operating performance was $90 million, an increase of 25 percent compared to first-quarter 2011 results. The improvement was primarily due to the impact of higher operating revenue, production labor efficiencies, a reduction in sales and marketing expense and termite damage claims, other cost reductions realized through ongoing initiatives and the favorable impact of acquiring assets in connection with exiting certain fleet leases. This improvement was partially offset by higher fuel prices.
 

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Senske Pest Control Expands Reach Through Las Vegas Acquisition

Senske Pest Control, Kennewick, Wash., acquired Las Vegas, Nevada-based Guardian Pest Defense in order to strengthen its residential pest control customer base and achieve its long-term goal of operating in the metro Las Vegas area.

“As a result of family demands I needed to spend more time with my family at this stage of my life,” said Ammon Hartner, former owner of Guardian Pest Defense. “I searched for a company with exceptional customer service who will maintain the quality my customers and employees have come to expect. After carefully considering several options and selecting a company that aligned with my guarantees, ethics, reliability and reputation, I am excited to announce that Senske Pest Control will be caring for my customers’ properties in the future.”

Hartner said he would continue to be involved in the Chicago Guardian Pest Defense location as in the past but also added, “It was a very good experience working with Senske. They offered a fair price and it only took 35 days from our first conversation to closing the deal.”

Senske, a company with 65 years of experience in the pest control business, had been on the search for an anchor in the Las Vegas market they could build on. “Guardian Pest Defense was just what we were looking for in a company to help us launch the Las Vegas operation,” said Chris Senske, president of Senske Pest Control.

In the last 12 months, Senske has acquired three companies in the pest control and lawn care industries, building a stronger presence in the central and south Intermountain West region. Senske operations now span a service area throughout the Intermountain West region.

“We will focus on continuing to give great service to Guardian’s customers and develop even stronger customer loyalty by offering a host of new services supported by a highly trained team of pest control experts. We look forward to servicing even more Western communities as we grow and develop the Senske brand in these new market territories,” said Senske.
 

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O Canada!

Michel Maheu, general manager of Maheu & Maheu, shares his observations on the current state of the Canadian pest control market.

Pest management is a global industry and Canada has long-been home to some of the most creative and successful pest management companies in North America.

Names such as Orkin, Ecolab, Steritech, Rentokil and Copesan have operations in the country and join Canadian-based firms, including Abell Pest Control and Maheu & Maheu, to form a dynamic marketplace with a heavy emphasis on commercial work. While not equal in size to the U.S. market — a recent IBIS World survey put the Canadian market near $600 million — the markets do face similar challenges (bed bugs for example) but Canadian PMPs have greater challenges in the regulatory area.

PCT spoke with Michel Maheu, general manager of Maheu & Maheu, one of Canada’s leading providers of pest management services, for his views on the current state of the Canadian market and where the opportunities exist going forward.

Q: How has the Canadian pest control market fared in recent years? Is it a mature market and what opportunities exist for growth?

A: There is the inevitable bed bug opportunity in larger cities like Toronto, Vancouver and Montreal. The market is pretty mature but there is room for creative companies to be successful. The economy was not hurt as bad as in the U.S. but the pie does not get bigger here either.

Q: How would you say the Canadian market is different from the U.S. market?

A: The Canadian market is roughly the opposite of the U.S. market and is 80 percent commercial and 20 percent residential. Do consumers value the services different-ly? I don’t think there is much difference. I would imagine the same consumer profiles are present in both markets.

Q: Are regulatory concerns greater in Canada than the U.S.?

A: We are over-regulated and have access to a very limited line-up of active ingredients. Regulations can vary from province to province and city to city. The product offerings for both pest management professionals and consumers are very limited. The regulatory climate is making companies hire people who are willing to learn more about pest biology and how to better apply exclusion techniques. They become experts at generating preventative and corrective management procedures, thus reducing the opportunities for pests to flourish and prevent problems. These are good things in the end but the regulatory climate is very challenging.

Q: Where do you see the Canadian pest control market headed in the next three to five years?

A: The residential market is likely to increase with more over-the-counter pesticide products being banned and taken away from the end user. There is no doubt that this will create a need for consumers to look to hire a professional pest management company.

Editor’s note: This article originally appeared in the Pest Control Canada e-newsletter, sponsored by Univar Environmental Sciences. To receive this e-newsletter, e-mail jdorsch@giemedia.com with the subject line “subscribe Canada.”

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Hulett Celebrates Another Year of Growth

Hulett Environmental Services, West Palm Beach, Fla., celebrated another significant year of growth at its annual sales awards ceremony in February.

“Growing like this is so much fun and having the ability to share it with all these great people that brought it to us makes it all the better,” said Tim Hulett, owner and CEO of Hulett Environmental Services. “We have quickly climbed into the top 20 pest control companies in the country and we have no intention of stopping here.”

This year’s ceremony was special to the Hulett family due to the passing of Guy Hulett, the first-generation and founder of Hulett Environmental Services. The family was given the Terry Chapin Award in honor of his contributions throughout the years, a fixture at Hulett’s corporate headquarters in West Palm Beach for decades.

“He will by greatly missed and always remembered,” said his grandson, Randy Hulett, the third-generation leader at Hulett.

In addition to the robust recurring sales bonuses paid monthly at Hulett, more than $50,000 was handed out at the award ceremony. “It’s a pleasure for me to pay out these bonuses,” said Tim Hulett. “These people are the ones that brought us here, and they more than deserve to share in the benefits of our growth. These are the people that are going to continue this great growth run we are on. We have just found our stride and it’s nowhere but up from here.”
 

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HomeTeam Pest Defense Survey Finds 84 Percent of Homeowners Experienced a Pest Problem in the Past 12 Months

A national survey by HomeTeam Pest Defense, Dallas, found that 84 percent of America’s homeowners experienced a pest problem in the past 12 months. The top pest issues for homeowners in the last year were ants (49 percent), spiders (43 percent), flies (37 percent), mosquitoes (34 percent), mice (30 percent) and wasps (29 percent).

HomeTeam Pest Defense has 50 branch locations throughout the Mid-Atlantic, Southeast, Mid-Central, Southwest and Western states. HomeTeam is a wholly owned subsidiary of Atlanta-based Rollins.

“Pests have appeared earlier than usual this year due to warm winter, early spring and recent heavy rains,” said Russ Horton, national technical director for HomeTeam Pest Defense. “We have already seen termite swarms in Texas, Georgia and Florida, odorous house ants in the Mid-Atlantic, and scorpions in Arizona.”

Additionally, HomeTeam’s national survey found that 80 percent of homeowners are concerned about pests in their home. The top pests homeowners worry about are termites, cockroaches, rats, bed bugs and mice. Termites are the greatest pest concern, worrying one in four, and 13 percent actually experienced termites in the last 12 months. Nearly one-quarter (22 percent) of homeowners have experienced structural damage to their home from a pest problem.

Eighty percent of homeowners are also concerned about being exposed to bed bugs when traveling, and most (81 percent) are not confident they know how to prevent bringing bed bugs into their home.

While many homeowners (54 percent) treated pest problems on their own, two-thirds of the do-it-yourselfers were unable to resolve their problem completely. Half of homeowners (51 percent) say using a pest control service is a necessity, and working with a company that guarantees its work was very important to almost everyone (95 percent). Treatments that will not harm children and pets were a high priority for 80 percent.

“There are easy ways to help lower your risk of infestation now and throughout the spring and summer,” added Horton. “In some cases, calling a professional to evaluate and inspect your property thoroughly may save a great deal of unplanned expense, not to mention headaches and time in the future.”

The survey also revealed the following:

• Forty-five percent of parents with children age 6-17 are not confident their child knows which pests are harmful and should be avoided.
• Fleas and ticks remain the top pest issues for pets. More than half (53 percent) of pet owners have experienced an issue with fleas.
• Half of people (51 percent) say they don’t think about pests when house hunting, but several pests including termites, bed bugs, rodents and cockroaches are deal breakers if seen in a potential home.

About the survey: In February 2012, Home-Team Pest Defense conducted a nationwide survey of homeowners to uncover the current trends and beliefs related to pests and pest control. The survey examined pest issues and pest-related topics related to travel, children, pets and home buying/selling. The survey consisted of 1,319 respondents across the U.S. All respondents were homeowners over the age of 18. The survey’s margin of error is +/- 5 percent at the 95 percent confidence level. QMobius and Aperio Insights provided research and analysis.

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Rose Launches Madagascar Giveaway Program

In an effort to raise interest among school children in science while promoting entomology, Troy, Michigan-based Rose Pest Solutions is giving away more than 1,000 Madagascar hissing cockroaches to elementary schools and children’s organizations in Michigan, Ohio and Indiana. The Madagascar Giveaway Program includes live insects, a plastic habitat, a fact sheet and care instructions.

“We hope our Madagascar Giveaway Program will motivate children to learn more about biology and the sciences while having a little fun caring for this amazing insect,” said Russ Ives, president of Rose Pest Solutions. “With so many science-based problems facing our society today, a good science education is vital for our young people.”

The Madagascar hissing cockroach is one of several similar species native to the island of Madagascar that lives on the forest floor near rotten logs. They are large, non-biting insects with a relatively long life cycle that are fun to observe and easy to care for. Because they are sub-tropical insects, they will not survive in our climate and cannot survive inside a building without care.
 

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Lexington Native is Proud to Return to Roots

Action Pest Control, Evansville, Ind., recently announced the expansion of the company to the Lexington, Ky., region. As a Lexington native and 1981 University of Kentucky entomology graduate, owner Kevin C. Pass says it’s a move he’s wanted to make for quite some time.

“Lexington will always be home for me and it’s a community to which I feel strongly tied,” said Pass.

Pass’ father, Professor Bobby C. Pass, was the department chair of the University of Kentucky’s entomology department from 1968 to 2001 and was a pioneer of many of the industry’s Integrated Pest Management practices used by today’s pest management firms.

Kevin Pass founded Action Pest Control in 1981 and has grown the company to five branch locations and more than 100 employees.

To support the expansion, Action has hired Danville resident and native Mike Vest. Vest comes to Action Pest Control with more than 16 years of pest management industry experience in the Louisville and Lexington areas. “In the short time Mike has been with Action, he’s proven to be a valuable asset to our company as well as the communities he serves. We’re very glad to have him on our team,” Pass said.