MARCH APRIL 2016
CONTROLLING INTEREST NEWSLETTER OF THE NEW ENGLAND PEST MANAGEMENT ASSOCIATION, INC. NEPMA PROFESSIONAL & VENDOR OF THE YEAR
The 2016 Vendor of the Year is Kelly Altland of Bell Laboratories.
At the New England Pest Management Association’s Spring Training Seminar & Expo, the 2016 Professional of the Year and the 2016 Vendor of the Year recipients were honored. The Professional of the Year award seeks to highlight an individual who has made outstanding contributions to the pest control industry through their work performance, community and industry service, technician training, or other notable accomplishments in pest control. This individual is chosen from nominations that are received from the membership. The 2016 Professional of the Year is Kevin Tavares, senior technician at Griggs & Browne. L to R, Galvin Murphy, Yankee Pest Control presenting the Vendor of the Year award to Kelly Altland of Bell Laboratories
NPMA ACADEMY 2016 Academy, the annual summer conference hosted by the National Pest Management Association (NPMA), will be held July 20-22 at the Hilton Orlando Bonnet Creek in Orlando, Florida. The Academy is a unique opportunity designed to advance the professional and business development of the industry’s leaders and emerging leaders in a hands-on, interactive environment. L to R, Ted Brayton, Griggs & Browne; Professional of the Year Kevin Tavares, Griggs & Browne; Bob Couto, Griggs & Browne The Vendor of the Year award honors that individual who goes above and beyond on behalf of their company to assist the members of the New England Pest Management Association in such ways as through education, legislative initiatives, volunteer support, etc.
The annual NPMA Academy is focused on providing both company leaders and up-and-coming managers with professional and personal development — slanted to the needs of the pest management professional. You will not find this type of educational opportunity anywhere else. Back by popular demand, Jason Dorsey, PestWorld 2015’s keynote speaker, will join us for Academy 2016 with a workshop centered on creating generational advantage. Sponsored by Dow AgroSciences, this session will leave you with an understanding of how you can leverage the
CONTROLLING INTEREST
PAGE 2 different generations you have working for you to help you grow your business and create customer and employee - loyalty.
BOARD OF DIRECTORS President: Jeffrey Weisberg, A-1 Exterminators, Inc., Lynn, MA President-elect: Ted Brayton, Griggs & Browne Pest Control, Abington, MA Secretary: Galvin J. Murphy, Yankee Pest Control, Inc., Malden, MA Treasurer: Ted Brayton, Griggs & Browne Pest Control, Abington, MA Immediate Past President: Ted St. Amand, Atlantic Pest Solutions, Kennebunkport, ME
Directors:
Ted Burgess, Burgess Pest Management, W. Bridgewater, MA Tom Drapeau, Freedom Pest Control, Topsfield, MA Steve Oles, Orkin, Inc., Northwood, NH Mike Peaslee, Modern Pest Services, Brunswick, ME Maria Richmond, Ransford Environmental Solutions, Inc., Worcester, MA Kevin Vaughn, General Environmental Services, Inc. , Malden, MA
COMMITTEE CHAIRS Audit: Bob Leon, General Environmental Services, Inc., Malden, MA Awards: Maria Richmond, Ransford Environmental Solutions, Inc., Worcester, MA By-laws: Dave Penttila, Dave’s Pest Control, Inc., Sturbridge, MA Controlling Interest: Tom Drapeau, Freedom Pest Control Co., Inc., Topsfield, MA Education/WDI Program: Galvin C. Murphy, Yankee Pest Control, Inc., Malden, MA Fundraising: Marillian Missiti, Buono Pest Control Co., Inc., Belmont, MA Government Affairs: Ted Burgess, Burgess Pest Management, W. Bridgewater, MA NPMA/QualityPro: Bill Siegel, Orkin, Inc., Ipswich, MA Membership: Tom Drapeau, Freedom Pest Control Co., Inc., Topsfield, MA Products & Services: Dave Penttila, Dave’s Pest Control, Inc., Sturbridge, MA Public Relations: George Williams, Univar, Woburn, MA Scholarship: Rod Kreimeyer, Best Pest Control Services, Inc., Somerville, MA Vendor Relations: Sheila Haddad, Bell Laboratories, Inc., Southington, CT Website: Kevin Vaughn, General Environmental Services, Inc., Malden, MA Executive Director: Walter Perry (wperry@cornerstoneam.com)
CONTROLLING INTEREST Controlling Interest is published six (6) times per year by the New England Pest Management Association and is distributed free to its members. Readers are encouraged to submit articles, announcements, reviews of products, or letters. To submit articles or to inquire about advertising rates and information, contact NEPMA at 53 Regional Drive, Suite 1, Concord, NH 03301, call toll-free at (866) 386-3762, or email info@nepma.org. The New England Pest Management Association believes that the information in this publication is accurate as of its publication date but is not responsible for inadvertent errors. No part of this newsletter may be reproduced in any fashion without the written consent of the editor.
www.NEPMA.org
Attend Academy 2016, July 20-22 in Orlando, and hear a session from Steve Donahue where you will learn how to create the type of vision that enthrals employees, captivates customers and builds a healthy bottom line. This is an exciting event you will NOT want to miss! For more details and registration, visit www. academy.npmapestworld.org.
MOSQUITO-AWARENESS.COM LAUNCHED AS EDUCATIONAL AND DISEASE PREVENTION RESOURCE FOR MOSQUITO CONTROL PROFESSIONALS Central Life Sciences, whose founders invented insect growth regulator (IGR) technology more than 35 years ago, announced the launch of www.mosquito-awareness.com, a site created to raise visibility of the potentially deadly diseases mosquitoes can spread, and educate visitors about preventing exposure and transmission. As part of an overall public education campaign focused on the “World’s Deadliest” insect, the website supports the nationwide work of Mosquito Abatement Districts (MADs), Public Health Officials (PHOs) and mosquito control professionals in providing timely information about mosquitoes and their effects. “One of the best ways for the public to approach the upcoming warmer months is by being educated about issues that can affect their health. Many people throughout the U.S. are familiar with West Nile virus or the more recent advent of the Zika virus,” said John Neberz, Business Manager, Vector Division at Central Life Sciences. He continued, “In addition to these, there are several other diseases transmitted by mosquitoes that can be harmful to health and even deadly, and this site serves as a comprehensive and educational resource where people can learn more about mosquitoes and the harm they are capable of inflicting.” “By arming both the public and agencies, such as MADs and PHOs that work to protect them, with helpful information, we hope to increase the level of
Connect with your colleagues. Join us on
CONTROLLING INTEREST
PAGE 3
We know ants inside and out. And one approach won’t cut it.
ANT SOLUTIONS
A nutrient-balanced granular bait rich in protein, labeled for indoor and outdoor use against ants and other pests.
A high-moisture bait rich in carbohydrates that retains moisture and stays attractive when other baits have dried up.
ONE SIZE DOES NOT FIT ALL. THAT’S WHY THERE ARE MAXFORCE ANT SOLUTIONS. Not all ants are created equal. And neither are the ways to control them. With Maxforce, you get options so you can diagnose a specific ant population and then choose the right treatment. Because targeted, taste-specific solutions deliver better results any way you cut it.
Learn more at backedbybayer.com Bayer CropScience LP, Environmental Science Division, 2 TW Alexander Drive, Research Triangle Park, NC 27709. 1-800-331-2867. www.backedbybayer.com. Bayer, the Bayer Cross and Maxforce are registered trademarks of Bayer. Not all products are registered in all states. Always read and follow label instructions carefully. ©2016 Bayer CropScience LP.
CONTROLLING INTEREST
PAGE 4
knowledge about mosquito-borne illnesses and how we can best protect ourselves,” he concluded. Mosquitoes pick up and carry disease pathogens and can transmit them from person to person through their bites. Individuals including the very young, elderly and those with chronic diseases could be at higher risk of side effects from these diseases. Mosquito-awareness.com provides information on arboviruses including: • • • • • •
West Nile virus Dengue Zika virus St. Louis Encephalitis virus Chikungunya Eastern Equine Encephalitis (EEEV)
There is also a link to the “World’s Deadliest” Facebook page, www.facebook.com/TheWorldsDeadliest which provides daily content relevant to mosquito disease control and prevention.
NPMA LEGISLATIVE DAY 2016, WASHINGTON, DC Representing the New England Pest Management Association
The site provides information about what families can do to help protect themselves from mosquito-borne diseases and what to look for to minimize exposure. It also offers a custom section where visitors enter their ZIP code to receive contact information for the nearest Mosquito Abatement District and Public Health Department in their community, which they can contact to learn about local control efforts. Specifically for mosquito abatement professionals, mosquitoawareness.com offers free outreach materials, ordered online, to support the “World’s Deadliest” campaign. This public education and awareness program communicates the critical nature of professionals’ work. Through the distribution of customizable posters, door hangers and informational brochures, MADs and PHOs can augment their work in local communities. More information can be found here: http:// mosquito-awareness.com/for-abatement-pros.
L to R Dan Fliescher, Pestex, Newtonville, MA; Marillian Missiti, Buono Pest Control, Belmont, MA; Jeff Weisberg, A-1 Exterminators, Lynn, MA; Shelia Haddad, Bell Laboratories, Southington, CT; Tom Drapeau, Freedom Pest Control, Topsfield, MA; Bill Siegel, Orkin, Ipswich, MA
NEPMA is Going Bowling! Mark Your Calendar
Saturday, November 12, 2016 Town Line Luxury Lanes, Malden, MA Member Companies and their families from around the region are invited to join for a day of bowling, prizes, food and entertainment Proceeds to benefit the Mark Weintraub Scholarship
CONTROLLING INTEREST
CVSA’S ANNUAL ROADCHECK SET FOR JUNE 7-9 JJ Keller The Commercial Vehicle Safety Alliance (CVSA) announced its annual International Roadcheck will take place June 7-9, 2016. The emphasis this year is tire safety (i.e., measuring the tire tread depth, checking the tire pressure, checking to make sure no items are lodged between dual tires, and examining the overall condition of the tire to ensure no deep cuts or bulges exist in the sidewalls of the tire). During the Roadcheck, inspectors will mainly conduct the North American Standard Level I Inspection — a 37-step procedure that includes an examination of both the driver and vehicle. Drivers may be asked to provide the following: License, Endorsements, Medical card, and Hours-of-service documentation. Drivers will also be checked for seat belt usage and the use of alcohol and/or drugs.
PAGE 5 The vehicle inspection may include a check of: The braking system, Securement of cargo, Coupling devices, Exhaust system, Frame, Fuel system, Lights, Steering mechanism, Driveline/driveshaft, Suspension, Tires, Van and open-top trailer bodies, Wheels and rims, Windshield wipers.
MARK YOUR CALENDAR TODAY NEPMA Fall Training Seminar & Expo November 3 – 4, 2016 Holiday Inn, Taunton, MA
(800) 842-1104
quipment: Ranging from custom fabricated spray rigs to flash lights we are ready to fulfil all of your equipment needs. ales:
Essco is a fully stocked pest control distributor with competitive pricing and on time deliveries in our own trucks.
ervice:
We are here to prioritize our customer's needs with a knowledgeable sales staff and fast accurate service.
mpany: Family owned and operated Essco takes pride in our long standing relationships with our customers and suppliers. Over 40 years of service and commitment to our customers We are here for you. Call today (800) 842-1104.
CONTROLLING INTEREST
PAGE 6
ZOËCON HAS THE SOLUTIONS THAT PUT THEM TO SLEEP FOREVER We are the pros that stand behind the pros. Zoëcon Professional Products has a deep portfolio backed by a team who knows what professionals need to succeed. We have products engineered to kill and control that include botanical solutions, broad-spectrum insecticides, synergists that boost effectiveness and IGRs for extended residuals and targeted control. Zoëcon professionals bring solutions that provide fierce infestation control. Every bug’s nightmare, is a PMP’s dream come true.
LEARN MORE AT ZOECON.COM
GO SOCIAL. Zoecon with design is a registered trademark of Wellmark International. ©2016 Wellmark International.
CONTROLLING INTEREST
LOSS PREVENTION A safety concern was noticed in the parking lot at the recent NEPMA Spring Training Seminar & Expo in Taunton, MA. Five trucks (from four different companies) with ladders on roof racks had them attached by bungee cords. Bungee cords are not adequate to secure ladders onto roof racks. Check out the picture of one of the trucks. That is a frayed bungee cord. A company I once worked for used to attach ladders that way until an incident happened. The ladder didn’t fly off the truck, but ended up hanging off the side of the vehicle while traveling. After this incident, that company required ladders be secured only with chains. If your trucks ever carry ladders on roof racks, I urge and recommend your company prohibit the use of bungee cords to secure ladders. Safety should be everyone’s primary concern!
PAGE 7 the Altriset label, the product better meets the needs of PMPs where these pests are problematic.” To provide the PMP with greater flexibility in controlling termite infestations, the updated label also includes an expanded application rate range option to increase the amount of active ingredient per finished gallon of solution, from 0.05 percent to 0.1 percent. Upon application, Altriset paralyzes the mouthparts of termites within hours of exposure, stopping further damage immediately. Its unique mode of action increases termites’ aggregation and grooming behavior, which allows affected termites to expose other colony members to Altriset. With an excellent environmental profile, Altriset used at labeled rates is sensitive to beneficial soil organisms, like earthworms. To control drywood termites, Altriset can be applied as a foam treatment to penetrate difficult-to-reach areas, such as inside wall voids and structural beams. In a study conducted by the University of California, Altriset achieved 100 percent control of Incisitermes minor drywood termites within one month of application. “Homes are often the biggest investment of the customers that PMPs service,” said Pat Willenbrock, head of marketing, Professional Pest Management for Syngenta in North America. “With more termites on the label, Altriset can be the solution for PMPs looking to help customers protect those investments.” For information about the Altriset and Syngenta Professional Pest Management, please contact the Syngenta Customer Center at 1-866-SYNGENT(A) (796-4368) or visit www. SyngentaPMP.com.
COMPANY AND PRODUCT NEWS! Syngenta Enhances Altriset® Label with Addition of Drywood Termites •
Altriset® termiticide now labeled to control drywood termites
•
Foam treatment to help control drywood termites in difficult-to-reach areas
•
Label updates include broader application rate range
Syngenta Professional Pest Management (PPM) is excited to announce Altriset® termiticide is now labeled for control of drywood termites, in addition to eastern subterranean and Formosan termites. With this label addition, Altriset can help offer more complete termite control for Pest Management Professionals (PMPs) and their businesses. “We understand PMPs can’t take a chance on termite control that doesn’t meet their business needs,” said Steve Dorer, market manager, Professional Pest Management for Syngenta in North America. “With the addition of drywood termites to
SELLING THE MIDDLE GROUND By Kristen Hampshire, PCT Magazine The middle class is gradually evaporating. The population of families with the two kids, two cars and two jobs is changing — there’s less money to spend. At least that’s what Pew Research tells us in reports like its 2015 study that states, “The American middle class is losing ground.” After four decades of being the country’s economic majority, the middle class is now outnumbered by those in income brackets above and below the “middle.” This is good and bad news, depending on how you cut it. That means that more households are gaining financial footing. And it also means that more families are focused on buying the basics because there’s less to go around. In 2015, 120.8 million adults were middle-income. There were 121.3 million lower- and upper-income households combined. Pew reports that middle-income Americans have fallen behind financially in the new century, with a median income in 2014 that was 4 percent less than in 2000. The housing market crash and recession didn’t help this group.
CONTROLLING INTEREST But does that mean that the typical sweet spot pest control customer — that $75,000-plus household — is backing off on pest control services? Are pest control companies feeling a lag that aligns with national statistics showing that their target audience is declining? Not exactly. The target pest control customer is not necessarily defined by class. “We think a person’s psychographic profile is driving who is the sweet spot, specifically a person’s tolerance to pests in the home,” says Cam Glover, managing director of marketing for Rollins. At Terminix, the profile of a prospect is an “active” customer who wants bugs to be gone — a do-it-for-me homeowner and someone who values professional service (and can afford it). “We are looking at the changing demographic of our consumers as more of an opportunity than a threat,” says Chip Colonna, vice president, product management. So the typical pest control customer is still there — a 35to 55-year old consumer who owns a home. But there is an influx of new adults hitting the market. They’re called Millennials, they’re 94 million strong and they possess all of the ideal qualities pest control companies target. (The catch is the way they must be marketed to — and that’s where the adaptation for pest control companies comes in, points out Cindy Mannes, executive director, Professional Pest Management Alliance.) The middle class statistics are real. Pew paints a rather partly cloudy picture of this once dominant population. But what will continue to impact the pest control customer base is not really about where a household falls on the national income ladder. It is all about geography, pest tolerance, perceived value of the service and the ability to communicate in an instant. (“Thanks to the advent of technology, for most consumers the cell phone is the remote control for their lives,” Colonna points out.) Considering Pew and other research analysts’ reports about the middle class, PCT magazine wanted to know: What does it all really matter? Here’s what we learned about what middle class means, who pest control companies’ target customers are today, and what opportunities businesses can find if they evolve and market smartly. WHO IS THE MIDDLE CLASS? So what does middle class mean exactly? That depends on whom you ask, and whether you’re talking about household income or lifestyle. Some experts limit middle class to those in the middle-fifth of the nation’s income span. Others define middle class by chopping off the upper and lower 20 percent of that income ladder and calling everything in between middle class. Pew Research Center defines middle class as two-thirds to two times the national median income based on household size. So, that number can range from $46,960 to $140,900 in
PAGE 8 household income, depending on how many people make up a family unit. Beyond household income is the way people spend: consumption. The thought is that if you’re spending more, that’s a reflection of your financial health. So tally up the annual total spent on food, transportation, entertainment, housing and miscellaneous items. That middle-fifth shells out $38,200 to $49,900 annually for cost of living, according to Notre Dame professor James X. Sullivan. There’s a middle-class lifestyle that some will say defines who is and who isn’t. For instance, those aspiring to live in a nice home, drive a car and take a family vacation might consider themselves middle class. This is an “aspirational” way of looking at the middle class, Pew reports. For example, when President Obama took office he created a task force to raise the standards of living and this task force had to define what middle class means. They looked at these life goals as benchmarks of what constitutes the middle class. Hill says, “I’m an economist, so at the end of the day it’s about what you can afford.” A 2015 Nielson Study looked at the fact that middle class isn’t necessarily about income, it’s a state of mind. “What is interesting is that the 58 percent that reported ‘living comfortably’ and 10 percent ‘free spenders’ were across all classes,” Glover points out. (The remaining 32 percent in this research said they could only afford the basics.) So middle class is possibly not just about income. It’s how you feel about the money, and your cost of living — where the money’s going. That’s where geography comes into play. How much does it cost to “do the basics” in your community? “That definition of middle class, I guess it’s a placeholder,” Colonna says. “But there are other things (impacting our pest control sales) that are much more important than how much money a consumer makes.” Geography makes all the difference, Mannes says. “There are statistics that support a declining middle class and I’m sure there are more poor people than wealthy people — but middle class in Cincinnati, Ohio, looks different than in San Francisco, Calif.,” Mannes says. “What is critical these days is really knowing where you live and paying attention to the demographics in your community,” she adds. Economist Ned Hill, professor of public affairs at The Ohio State University, agrees that the cost of living in different areas of the country will impact the number of middle class families there. “I believe the middle income market is stronger in places where housing costs have not escalated as much, and also in places that are a little less dense,” he says. “The real issue is just what fraction of your disposable
CONTROLLING INTEREST income is taken up by housing costs,” Hill continues. “So if you are in business, you have to make certain that you don’t pay attention to national numbers — you have to figure out what those numbers mean in your market.” Pest control trends analyses by PPMA identify $75,000-plus as the average income level of pest control customers in a nationwide sample. But in some regions such as the Southeast, the average pest control customer might be a $50,000 household with lots of pest pressure. That same community also might have a lower cost of living than another region like the Northeast. “Pest control is ‘affordable’ based on where you live,” Mannes says.
PAGE 10
BE SURE.
YOU’RE INSURED WITH BROWNYARD. With PCOpro® you won’t get caught in the under-insured trap!
The numbers showing a shrinking middle class are indisputable, Mannes says. But the numbers don’t tell the whole story. “The approach for (selling) pest control might be slightly different in looking at the demographics of who is in your area and targeting those demographics — and recognizing that those might be changing,” Mannes says. Mannes is talking about the growing population of 70-plus year olds who are choosing (if possible) to stay in their homes longer. And, there’s the 94 million Millennials who will represent a real opportunity for pest control companies as they purchase their own homes, continue climbing in their careers and spend differently than their parents did. (“They are the doit-for-me’s” that value services, Colonna points out.) So what pest control firms need to focus on is not the fact that reports reveal a shrinking middle class. But rather, there will be a growing opportunity to sell pest control services to customers who will buy no matter their income. For example, if you’ve got bugs, you’ll fork over some spending money to take care of the problem rather than take those dollars to the local retailer. “No matter what class you are in, any time you make a purchase of a product or service, you are making a trade off and there’s something you don’t buy as a result of that (decision),” Glover says. Pest control purchases “depend on tolerance.” From a grand consumer spending perspective, Hill points out that spending is happening on the budget end (left) and the concierge end (right). He points to grocers as an example.
For over 20 years, our Pest Control Operators’ insurance program has featured broad coverage, highly rated insurance carriers, and unmatched in-house claims service. BE SURE. BE PCOpro SECURE.
“There is growth in low-end, big-box, generic commodity food stores,” Hill says. “At the other end you have another type of food industry that is a mixture of convenience, entertainment and style. I call it food-tainment. The traditional mass-market firm in the middle has gotten hammered.” Market protection for businesses in the middle will come from establishing internal cost controls, and focusing on quality. “Folks are out there on Yelp and Angie’s List…what
800-645-5820 | PCOpro@brownyard.com brownyard.com
CONTROLLING INTEREST
ATTRACTIVE AT ANY ANGLE. Talon® Ultrablok rodenticide gives you the proven active ingredient brodifacoum in a new formula that’s highly palatable to rodents. Using the latest advances in food science, the bait attracts both mice and rats, including those known for warfarin resistance. But the real attraction is that it still takes only one bite to be effective. So you won’t have to worry about bait shyness, and your customers won’t notice unwanted pests on their property.
To learn more, visit SyngentaPMP.com/TalonUltrablok or contact: Jonathan Davis 484-843-4348 jonathan.davis@syngenta.com
©2015 Syngenta. Important: Always read and follow label instructions. Some products may not be registered for sale or use in all states or counties. Please check with your state or local extension service to ensure registration status. Talon®, For Life Uninterrupted™, the Alliance Frame, the Purpose Icon and the Syngenta logo are trademarks of a Syngenta Group Company. Syngenta Customer Center: 1-866-SYNGENT(A) (796-4368). MW 1LGP5059 7/15
PAGE 11
CONTROLLING INTEREST is important (for businesses) is addressing how they get rated for promptness, courtesy and quality,” Hill says. CONTROL AT ANY COST. Geography influences the definition of middle class. It plays a significant role in whether pest pressure is so great that the service is a priority. And location also dictates the cost of pest control services — which circles back to the issue of middle class and whether they’re still buying. The industry professionals PCT talked to said, absolutely.
PAGE 12
The middle class statistics reported by Pew and others are not evident in sales or retention at Hoban Pest Control in Avon Lake, Ohio, which services the Cleveland suburbs. President Dave Hoban’s customer base hasn’t changed at all over the years in spite of the economy or the “diminishing” middle class. What his residential customers have in common is this: They mostly live in suburban neighborhoods, are considered “upper middle class” and they’re loyal. Oh, and they don’t want pests around either.
“We are not seeing an influx of cancellations or any change “We find that what pest control companies charge in the with recurring services,” Hoban reports, noting that his Southeast is actually less than what they would charge in the business is actually growing from referrals and he has cut his Midwest,” said Gary Curl, president of Specialty Consultants. company’s advertising spend. Route density is, perhaps, one reason. “A pest control company could service every third house in a community in “There are no changes to be honest,” Hoban confirms. the Southeast, which means they have less windshield time.” Of course, Pew is reporting on middle-class income — not So, those high-volume, tightly route pest control firms can be how these households feel about pests moving in. And pest more price competitive in the residential market, Curl relates. pressure/tolerance is a big factor in the buying decision and On the commercial end, it’s different. He notices based on why homeowners perhaps will sacrifice another service his firm’s research that the average cost of commercial pest (lawn mowing) to keep their pest control service online, control in the Southeast is more than in areas of the country according to the professionals PCT spoke to for this story. with less pest pressure. “We believe that’s because when you “We are looking for the customer who is proactive — who get into a commercial account in the South, you have a lot values their home and their families and is willing to invest more work to do there,” Curl says. in some type of protection,” Colonna says. With any product or service, consumers make choices. Those buying decisions are impacted by variables: How much does housing cost in your region? What’s the price at the pump? Are there lots of pests around? “What is critical is knowing where you live,” Mannes says.
Tired of the rat race? Modern Pest Services has been an industry leader for over 65 years and we’re always open to strategic acquisition opportunities, particularly in the residential market. If you’re interested in having your business become part of one of New England’s fastest-growing and most progressive companies, please contact us. Tim Hagelin, Operations Manager 207.721.0167 timhagelin@modernpest.com
All inquiries will be kept confidential
modernpest.com
While the middle class may be shrinking, the prospect pool for pest control companies could actually be growing. That’s especially true for companies that are stretching their service boundaries. For example, Terminix introduced an exclusion service to manage wildlife in consumers’ attics. It also provides mosquito control for the outdoors. “When people are trying to protect their homes against outside threats, that goes beyond the boundaries of the foundation of a house and includes everything from the driveway to the back fence,” Colonna says. “So, that has caused us to take a look at what we can do to help eliminate specific pest control threats to the consumer.” The market for pest control could be getting bigger if you’re a business that’s looking beyond traditional services. Evolving as an operation will be critical for capturing those proactive customers. This speaks to helping consumers protect their greatest asset: their homes. We buy car insurance that’s a larger percentage of the overall value of a vehicle compared to what termite services cost relative to the total cost of a home, Colonna points out. “If a customer recognizes that termites are a threat against the largest investment they’ve ever made, they are more willing to take a part of their incomes to protect their homes against that threat,” he says. NEW OPPORTUNITY. The middle class decline has been a gradual one, though the recession in 2007 to 2009 did trigger a faster deflation among households qualifying as
CONTROLLING INTEREST
PAGE 13
CONTROLLING INTEREST middle-income, mostly because this population’s greatest asset is generally real estate. Incomes have been stagnant. According to a New York Times editorial addressing “Why Americans still Think the Economy Is Terrible,” the 2014 census numbers on U.S. incomes is “not statistically different.” In a way, pest control growth has the same flavor. This has never been a boom industry with steep growth spurts on record — the kind of skyrocketing market ascent that IT businesses might experience. And, “the who” concerning target pest control customer just hasn’t changed that much over the years. They’re still homeowners, still usually in that 35 to 55 age group, still making about $75,000 per year per family. “The new model (to succeed) is similar to the old model: continue to offer value that is equal to or greater than the price the customer is paying for the service,” Rollins’ Glover says. But there’s a lot different about the potential customer universe for pest control services now, Mannes points out. It’s all about opportunity. “This is the first time in history we are dealing with four generations (of customers),” Mannes points out. There are The Matures (70-plus years old), The Baby Boomers, Gen-Xers and Millennials. “This is a huge opportunity for us, but their buying habits are very different so it’s also a challenge,” Mannes says, relating that pest control companies that are slow to adopt to the digital age could miss out on this population’s business. For pest control companies, the fact that the middle class is not getting larger paychecks and statistically has less money to spend might not have anything to do with whether they sign on for service. Because if a home has a pest control problem, there’s always going to be a population of buyers in all classes that want the issue solved.
About Waltham Services
Founded in 1893, Waltham Services has grown to the largest pest control provider in New England. Our company’s growth did not happen by chance, it’s a reflection of our commitment to long, profitable relationships with our coworkers and customers. We are proud of our reputation; built upon decades of personalized attention to solving and preventing the most stubborn pest problems. If you are considering a change and your plans include selling your company, please consider Waltham Services.
PAGE 14 “If you are a homeowner, the chances are you are a pretty good target for (our business),” Colonna says, adding, “We are not looking at just household income.” Again, it’s those other attributes (perceived value, home protection) that add up to sale. Income is just a slice of that, and not enough to take a bite out of pest control companies’ revenues from what we’re finding. Glover comments: “I don’t think how we have had to adapt has been as dramatic as the news and research would show.” Glover is speaking about retaining business in a tough economy — “I would argue that pest control is a unique category,” he says. Turning on a fresh marketing switch to appeal to progressive customers in the digital age is a different story. And, the way we consume information has nothing to do with class and everything to do with wanting results in an instant. That, more than anything, will impact the way pest control companies do business today — and tomorrow. Colonna says, “The Millennials having that attribute of wanting someone to ‘do it for me’ is a benefit.”
MEMBER BENEFIT HIGHLIGHT: OSHA TOOLBOX As a benefit of membership, NPMA members have access to the OSHA Toolbox, a comprehensive website including resources for OSHA inspection, posting requirements, state plans, respiratory protection and injury and illness reporting. To log on, visit www.qualityprotools.org and enter “osha” as both the username and password.
•
Our company is well funded and understands all that’s involved purchasing a family owned business.
•
Your employees will realize generous compensation, benefits and advancement opportunities.
•
Your customers will have a seamless transition, with no interruption of service.
Contact
Michael Botte Vice President / GM 781-893-1810
All conversations strictly confidential.
CONTROLLING INTEREST
PAGE 15
CONTROLLING INTEREST
PAGE 16
CONTROLLING INTEREST
PAGE 17
CONTROLLING INTEREST
VERMONT BECOMES FIFTH STATE TO ENACT PAID SICK LEAVE JJ Keller The state-based wave of paid sick leave continues, as Vermont joins California, Connecticut, Massachusetts, Oregon, and Washington D.C. in entitling employees to paid sick leave. The general provisions of Vermont’s law are as follows: Covered employers: Those with more than five employees will be subject to the law as of January 1, 2017, while those with five or fewer will be subject to it as of January 1, 2018. Eligible employees: Those who work at least an average of 18 hours per week during a year, and worked at least 20 weeks in a 12-month period. Ineligible employees include certain state or federal employees, per diem or intermittent employees, employees 18 or younger, and certain sole proprietors, partner owners, executive officers, or managers. Waiting period: Employers may require a waiting period of up to one year for newly hired employees or for current employees who are employed on the law’s effective date. During the waiting period, employees accrue sick time, but are not to use it until after the completion of the waiting period. Accrual: Eligible employees accrue at least one hour of sick time for every 52 hours worked, and must be allowed to carry unused leave over to a subsequent year, but there may be caps. From January 1, 2017, to December 31, 2018, employers may cap accrual to 24 hours in a 12-month period, and after December 31, 2018, limit accrual to 40 hours in a 12-month period. Use of leave: Eligible employee may use earned sick leave for the following reasons: The employee’s illness or injury. Obtaining professional diagnostic, preventive, routine, or therapeutic health care. Caring for a sick or injured parent, grandparent, spouse, child, sibling, parent-in-law, grandchild, or foster child, or obtaining diagnostic, preventive, routine, or therapeutic health treatment for such a family member, or accompanying such a family member to an appointment related to the family member’s long-term care. Arranging for social or legal services or obtaining medical care or counseling for the employee or the employee’s family member who is a victim of domestic violence, sexual assault, or stalking. To care for a family member because the school or business where that family member is normally located during the employee’s workday is closed for public health or safety reasons. Benefits continuation: Group insurance benefits must be continued while an employee is on paid sick leave, as they
PAGE 18 were before leave began. Poster: Employers will be required to post a notice of the provisions of this law conspicuously to employees, and notify new hires of the provisions. Current leave policy: If employers already offer paid time off that mirrors the new provisions, they need not provide more. More sick leave laws may be on the way. Other states, such as Maryland, New Jersey, and Wisconsin, have introduced bills that would provide for paid sick leave.
ASK MR. PEST CONTROL German Coffee Question: I have several coffee shop accounts and some have German cockroaches inside the coffee machines that are coming from other food stores. I have applied Maxforce gel with hydramethylnon, Maxforce Impact and Advion cockroach gel and the problem continues. I am thinking of applying diatomaceous earth or an aerosol like CB-80 after asking for some good cleaning to reduce the food and water sources. What do you recommend? Answer: Throwing many products at a pest infestation without resolution is usually an indicator that the products are not the problem. My guess is you are focusing on the coffee machines as the root of the problem and not seeing a bigger picture that may be occurring. What’s going on in the rest of the kitchen? Are there cockroaches anywhere else? If they’re only in the coffee machines, the baits should have been effective if you (a) watched them accept the bait and (b) you applied enough bait for the amount of cockroaches present. If you didn’t do both (a) and (b), then go back and try again. If you did do both (a) and (b), then the problem is probably bigger than just the coffee machines. Maybe the counter underneath or the wall void behind the coffee machines is infested as well and those cockroaches move into the coffee machines after each batch you eliminate with baits. Only a thorough inspection can tell. --Mr. Pest Control (Editor’s note: Articles from the Ask Mr. Pest Control series are reprinted with permission from Univar. Mr. Pest Control is answering questions supplied by PMP customers across North America. His answers are generated from industry and manufacturer-provided information. The answer may not be specific to the laws and regulations for your State, Province, Territory or Country. In addition, products mentioned may not be registered and or available in all areas. Always check with your local Univar office for specific information to your area. Always read and follow label directions.)
CONTROLLING INTEREST
PAGE 19
Over 4,000
Pest Management Companies
Can’t be Wrong
Stuart Aust, President & CEO, Bug Doctor Termite and Pest Control has been working with Select Insurance for five years. The company handles insurance needs for all of Aust’s divisions, including Bird Doctor Nationwide, Mosquito Doctor, Bedbug Doctor, Animal Doctor and the original Bug Doctor.
• Select Insurance Agency is a family-owned and operated business that provides insurance products specifically tailored to meet the risk management needs of the pest management industry in over 45 States Nationwide.
“It is a privilege and an honor to work with the Select Insurance team. The owners, Phillis and Frank MacDonald, run a first class organization. What differentiates Select Insurance from the competition is that they are extremely responsive, their costs are very competitive, working with them is seamless, and they are the complete package. They only sell us what we need and never try to pressure us to buy additional insurance to enhance their bottom line.”
• General Liability
— Stuart Aust, President & CEO, Bug Doctor Termite and Pest Control
“They can talk shop with us,“Aust says. “They totally understand what we’re doing. They understand all facets of pest control.”
Pictured: Frank and Phillis MacDonald, Select Insurance Agency
• Automobile & Fleet Coverages • Workers’ Compensation • Umbrella • Commercial Property • Employment Practices Liability • Commercial Crime • Canine Mortality • Mold Liability • As former pest management professionals, Select’s owners understand that every pest management professional operates his or her business differently, resulting in a variety of exposures and risks. Select considers each business individually before developing a pest management insurance program and assigning a carrier. • Select Insurance Agency is a proud member of the National Pest Management Association, and maintains many state and regional memberships as well.
1 (888) 542-9002
Quotes@SelectAgency.com
www.selectagency.com
SelectInsuranceAdvertorial_jg3.indd 1
12/4/13 12:09 PM
CONTROLLING INTEREST
PEST CONTROL OPERATORS - CLUES TO SUCCESS ON YOUR FINANCIAL STATEMENTS by Daniel S. Gordon, CPA Information is power… and the internal bookkeeper or accountant in your company wields a tremendous amount of power as he or she provides the information that shows how the company is doing financially which helps management/ ownership make key decisions regarding operating the business. Accurate and complete financial bookkeeping is key to providing meaningful reports. Meaningful reports provide clues to the condition of your company such as: •
Alerting management to problems that exist or are emerging that will effect profit, cash flow or general financial condition
•
Suggesting opportunities for improving the health of the company
But how do we look for business success or areas that need improvement in the financials and also what areas should be studied to determine if the financials are accurate and presenting a true picture of the business? The following is a good start but by no means is all inclusive. Balance Sheet Alerts – A Balance sheet is essentially an accounting of everything a firm owns (at cost) minus what the firm owes. The difference is known as equity. As an example, assume we purchase a home for $300,000 and took out at $200,000 mortgage our equity would be $100,000 ($300,000 – $200,000). Below are some items that worth scrutinizing on the Balance sheet Cash – Too much cash in a standard non-interest bearing checking account means that we are not managing this asset properly. Cash should be at work either earning interest, purchasing inventory or equipment at discounts, etc. However too little cash can be disastrous, not allowing the business to meet its current obligations. In a pest control business accounts receivable are constantly being turned over so there is usually a steady inflow of cash. But a good rule of thumb is found in a ratio called the quick ratio. The quick ratio is the fraction: Cash / Accounts payable. A healthy quick ratio would be 1.25 or better. Accounts Receivable – Of the total amount of Accounts Receivable how much is current. If your payment terms allow for 30 days, how much money is in the over 30 day column? 60 day Column?, over 90 day column? Past due receivables cause a slowdown in cash flow and the older the receivable the more likely it will become a bad debt. How much should you carry in Accounts Receivable? A simple barometer on this would be number of days sales in A/R. This is calculated by dividing the A/R balance by the average
PAGE 20 daily sales. The result will give you the number of days of sales that is sitting in A/R. If this number is greater than the terms you offer say 30 days then your customers are not staying within the terms you offer. Inventory – For the most part our industry orders inventory on a just in time basis. There are exceptions for example at the end of the year, many distributors give great deals if you make your purchase by the end of the year. This may create a higher than normal inventory. But for the most part inventory should equal the cost of material on all trucks plus a week or two of inventory in our chemical room. In this manner we are not tying up too much money in inventory. Again, the only way a PCO wants to stock pile inventory is if he gets a great deal. Accounts Payable – Accounts Payable are the symmetrical opposite of Accounts Receivable. Rather than representing the amounts owed to the company, Accounts payable represents amounts owed by the company to vendors. Accounts payable are also aged using the 30, 60, 90 protocol. A healthy company will not have large amounts over 30 days as the A/P aging is an indicator of if a company is staying current on its obligations. Certain exceptions to this rule exist such as disputed bills. Profit and Loss Statement Alerts – A profit and loss statement is a snapshot of what the company is producing in terms of revenues, expenses and profits. It should be looked at on a monthly basis as well as a year to date basis. Below are some items that worth scrutinizing on the Profit and Loss: Revenues - I like to see revenues recorded as they are produced (accrual basis). They should be broken into divisions such as: • • •
Commercial Residential WDI
Within the divisions we like to see Start Ups, One Times and Recurring Revenues. It’s not as important to call a revenue type the target item such as Ants, Mice, fleas, etc. It’s more important to understand its recurrence and the recurrence pattern it takes. This methodology is consistent with a continuous valuation of the company. Cost of Goods Sold (COGS) – Sometimes known as direct costs COGS include all costs associated with putting a technician on the road. These costs include technician labor, benefits, vehicle costs, chemical costs and other costs that are incurred for technicians on the road. The total of these direct costs should be no more than 50% for a pest control company. Gross Margin – Gross margin is the difference between revenues and direct expenses expressed as a percentage. In pest control, gross margin should be 50% or greater. Gross Margin is one of the most important metrics in running a business. Gross margin determines breakeven point. For
CONTROLLING INTEREST
PAGE 21
More time. More jobs. More profit. What you do with it is up to you. Termidor H•E High-Efficiency Termiticide provides the same 100 percent efficacy you’ve come to expect from Termidor , but it allows for 50 percent less water and 30 percent less trenching. You can use the time and resources you’ll save to complete more jobs and increase profits. We’re not here to tell you how to spend your money—only to help you make more of it. ®
®
Visit termidor-he-calculator.basf.us to discover how you can make termite treatments even more profitable. Always read and follow label directions. A Termidor® termiticide/insecticide application can only be performed by a licensed pest control professional. Termidor is a registered trademark and the Termidor logo is a trademark of BASF. © 2014 BASF Corporation. All rights reserved.
CONTROLLING INTEREST
PAGE 22
example let’s assume that all non-COGS costs are $10,000 for the month with a 50% gross margin, our breakeven point in revenue would be $20,000 (10,000/.5). After revenues exceed $20,000 we would make profit at a rate of 50 cents on each dollar of revenue. Sales and Marketing – These two functions are probably the most important functions in running any business. Without sales, we have no business. The difference between the two is that marketing represents all efforts to create leads. Sales represents all efforts to close those leads. While in general we can look at these efforts as an acceptable percentage of revenues, I don’t mind driving these percentages way up as long as the lead cost and closing ratios are acceptable especially in smaller companies. Therefore judging this number is sometimes more difficult than just looking for a standard percentage.
PRO-PELL
TM
Professional Liquid Rodent Repellent
100% All Natural Ingredients
General and Administration (G&A) – This category represents all non-direct, sales or marketing costs. G&A can include office rent, professional fees, office salaries, etc. G&A usually runs at around 20-25% of revenues. Net Income – This is what we work for. How much did we make? Revenue minus all expenses. What should this number be? On average we usually look for 10%-15% before taxes. Conclusion – Understanding financial statements allow you to make a realistic assessments of your firm. The above should be used as a guideline to rating the results of your efforts as not all PCO firms are the same and the goals of management may be different depending on the company. High growth companies may not be as profitable as companies who are not looking for large revenue increases. Many owners may want high profits and sacrifice growth. While managing by the numbers is a great management tool a clear understanding of managements objectives need to be spelled out.
CALENDAR OF EVENTS July 20-22, 2016
NPMA Academy Hilton Orlando Bonnet Creek Orlando, FL
August 10, 2016
NEPMA Long Range Planning Meeting
October 18-21, 2016
PestWorld 2016 Seattle, WA
November 3-4, 2016
NEPMA Fall Training Seminar & Expo Holiday Inn, Taunton, MA
November 12, 2016
NEPMA Bowling Town Line Luxury Lanes, Malden, MA
Increase your winter route charges by 35%
Change the way you do WINTER SERVICE! For more information contact your distributor or visit us at Pro-Pell.com
888-401-3134
CONTROLLING INTEREST
PAGE 23
The right product is just the beginning.®
UNIVAR
Getting what you need, when you need it, no matter what — that’s the promise of Univar Environmental Sciences. But our service doesn’t stop at our industry-best product selection. Our experienced team can offer insightful advice at every turn. So get in touch with your local rep and discover how Univar can help you drive business. Call us at 800-888-4897 or go to PestWeb.com
© 2016. Univar USA Inc. All rights reserved. UNIVAR, the hexagon, and other identified trademarks are the property of Univar Inc., Univar USA Inc. or affiliated companies.
CONTROLLING INTEREST
PAGE 24
• Supplies: Residex is a full-line distributor of structural pest and turf products. • Support: We resolve our customers’ toughest technical problems & offer profitable business ideas. • Solutions: Residex is your partner. We have over 101 solutions to help you grow . . . improved sales results, sales training workshops, human resource solutions. . . . just to name a few. • An American owned and operated distributor for over 70 years. Franklin
Hartford
508-507-7337
888-267-7751
CONTROLLING INTEREST
PAGE 25
Keep your serviCes
well done and the CallBaCKs
rare Beef up your profits with the comprehensive food-handling portfolio from FMC. Effective pest management in food-handling establishments can be a tall order. That’s why FMC assembled a comprehensive portfolio of products designed to help professionals increase profitability. These innovative solutions represent all the ingredients you need for successful pest management, even in the most challenging commercial accounts.
to learn more, visit www.fmcprosolutions.com or contact your FMC Market specialist.
FMC Pest
@FMCpest
FMC Pest
fmcprosolutions.com
Always read and follow label directions. FMC, CB-80, D-Force, EndZone and Mikron are trademarks of FMC Corporation. Purge is a trademark of Amrep IP Holdings, LLC. Transport is a trademark of Nippon Soda Co., LTD. Š2014 FMC Corporation. All rights reserved.
The New England Pest Management Associa�on Poli�cal Ac�on Commi�ee is a voluntary, non‐par�san, po‐ li�cal commi�ee represen�ng the interests of pest control industry. It is organized exclusively to raise funds for the purpose of protec�ng and perpetua�ng the interests of the industry. NEPMA‐PAC was established to defend and promote the needs of desires of the New England Pest Management Associa�on, its members interests and employees through poli�cal ac�on. Together, the Board of Directors and the Government Affairs Chair, appointed by the President of the Asso‐ cia�on, organize, operate and approve all ac�vi�es and ac�ons of the NEPMA‐PAC in accordance with the Massachuse�s State Laws governing Elec�on Campaign Funding. NEPMA‐PAC does not par�cipate in Fed‐ eral Elec�ons.
To accomplish important objec�ves, the New England Pest Management Associa�on Poli�cal Ac�on Commi�ee seeks to receive and expend contribu�ons for the purpose of suppor�ng can‐ didates for public office who are in general agree‐ ment with the objec�ves of our interests. An analysis of many factors, including the candidates dedica�on to the legisla�ve goals of the pest management industry, vo�ng record and poli�cal principles are used in selec�ng candidates to sup‐ port. Poli�cal ac�on has no muscle without nancial resources. Your contribu�on is vital to ge�ng legislators to listen to our needs. Having your voice heard has a lot to do with the size of your wallet. At present, we badly need your help in order to preserve your interests.
Please send checks to: 53 Regional Drive, Suite 1 | Concord, NH 03301 Or contact: info@NEPMA.org
Please send only personal checks made out to NEPMA‐PAC. Corporate checks are not permissible. Contribu�ons cannot exceed $500.00 annually, so please contribute as much as you can.
CONTROLLING INTEREST
PAGE 27
Every dollar matters which is why THOR only sells direct.
No middleman means lower prices, faster service, and an unmatched level of expertise.
See what buying manufacturer direct can do for your business.
Steve Goscinsky Cell: 203-482-0778 Toll Free: 866-863-7152 sgoscinsky@ensystex.com
ENSYSTEX
866-FOR-THOR FOR-THOR.COM
CONTROLLING INTEREST
53 REGIONAL DRIVE, SUITE 1 CONCORD, NH 03301
PRINT MEDIA EVENTS CONTROLLING INTEREST IS NEPMA’S MEMBER NEWSLETTER
NEPMA.ORG LINKEDIN
WDI INSPECTION REGISTRY EDUCATION EXPRESS SPRING TRAINING FALL TRAINING
FACEBOOK NEPMA.ORG 53 REGIONAL DRIVE SUITE 1 CONCORD NH 03301 | (866) 386-3762 | INFO@NEPMA.ORG