Pest professionals look to insulate their bottom line in pursuit of new revenue streams.
Casting a wide, more substantial revenue net is the goal of every pest management professional who fishes the fickle waters of add-on-services.
Through the years many add-on and bundled service concepts have been introduced to the industry from radon gas testing to lawn care services. Some have stuck and become solid revenue and profit contributors to the balance sheet while other have been lost to time under the “Why did we ever do that?” file.
As consumer preferences have evolved to demand convenience and ease of use when it comes to selecting service providers, pest management professionals across the country have expanded their lineup of services to include everything from pool cleaning to home repairs.
Roger More, a management consultant and former Harvard University School of Business professor, offered this viewpoint on bundling service offerings to consumers in his recent book, “Marketing High Profit Product/Service Solutions.”
“A product or service super-bundle is created when your integrated solution creates your customers’ most differentiated and desired choice…You become the mirror image of the customer’s solution process and life cycle. Looking at your solution, your customers see themselves.”
Becoming the mirror image of the customer’s solution process may not have been the goal Bill Turk, founder and CEO of TAP Pest Control Insulation, had in mind when he first started pitching insulation services to pest management professionals, but if that is the outcome he won’t mind.
“Pest control companies have a huge advantage when it comes to selling insulation because they are already in the home and have established a relationship with the homeowner,” says Turk. “You don’t find that with regular insulation contractors who are typically hired by the builder and for whom installing insulation in your customers’ homes is a one-shot deal.”
Why Insulation? Turk focused on introducing TAP — thermal acoustical pest control — to pest management professionals as the industry shed its “bug guy” image and expanded its offerings to include a variety of homeowner-focused services.
“Pest management professionals are the protector of a consumer’s biggest investment — their home,” says Turk. “Homeowners looking for additional home services will turn to a trusted professional who they have a relationship with.”
A pest management company’s organizational structure — a built-in sales and service workforce and a preventive treatment mindset — also contribute favorably to marketing and installing insulation. TAP is EPA registered, and can be used in residential and commercial structures as part of a comprehensive IPM program.
TAP insulation contains boric acid that is impregnated into the insulation, does not need retreating and can be applied directly over existing attic insulation. It creates a thermal envelope around a home that not only improves the performance of the homeowner’s heating and cooling systems but controls cockroaches, ants, termites (drywood and Formosan) and occasional invaders that come in contact with the product.
“The pest management industry offers customers comfort from pests, and TAP is an extension of that,” says Turk. “It is a new product category, but the end result is that it will save homeowners money and proactively eliminate pests.”
Turk says customers are eligible for a 10 percent federal tax credit and possibly local municipality utility rebates after installing new insulation.
Selling Insulation. Identifying if add-on services are right for your firm starts with asking a series of questions. These questions focus on determining if your structure and culture will support a new service offering and include:
- Are you set up to add new services to your existing service routes or will you have to set up a new division?
- Do you have the right people in place to take on added responsibilities and undergo the necessary training or will you have to hire new staff?
- What will your investment be in new equipment?
- Can your sales force support the new effort?
When Turk sits down with a pest management professional to talk about becoming a TAP provider he finds out what the company’s history is in regard to add-on services and what their previous experience was like.
“We want to identify what will make them successful and the first question is, ‘Is inspecting the customer’s attic for pests a routine function for your technicians?’” says Turk. “We have found companies with multiple service routes and dedicated sales forces do well with TAP.”
Turk says the pest management companies that have enjoyed success selling and installing TAP have engaged their technicians in the prospecting and sales process. Depending on the company’s structure, technicians can generate leads for inspectors to follow up on or sell and service the account themselves.
“Even in the busy summer months technicians can identify possible customers during a routine service visit and record that for follow up in the fall,” says Turk. “The key is having the ability to manage the sales process and continually identify prospects.”
The initial investment in equipment — blower, hose reel and hoses — can run a company in the neighborhood of $7,000. The investment also includes a start-up marketing kit and one day of on-site training for staff that involves classroom time and an actual hands-on attic install job.
An optional commercial vacuum system for removing insulation — a job often associated with rodent or nuisance wildlife cleanouts — will run another $6,000. Companies also will need to have a 14-foot trailer or box truck to carry the equipment and insulation.
It typically takes two technicians to do a half-day job including the preparation and installation of the insulation. An average home will require about 32 bags of insulation. If the company has sold an insulation removal job as well, it can take two technicians a full day to complete that work.
Getting The Word Out. Turk recommends pest management professionals integrate TAP insulation into their other marketing vehicles for pest control and promote it as an additional tool to fight pests.
“Do not treat this like an outside service but instead promote it as another way your company can prevent and eliminate pests in a customer’s home or business,” says Turk. “Most customers won’t ask for insulation and explaining how it fits into their overall pest management program is important.”
For Dennis Wilson and James Grande of Pacific Coast Termite in Tustin, Calif., TAP has turned out to be a solid complement to their firm’s regular termite, wood repair and rodent exclusion service offerings.
“As our termite, wood repair and rodent exclusion services were growing, insulation was a natural fit,” says Grande, who with Wilson founded Pacific Coast Termite in 2007. “We were already working in the attic for our other services, and we decided to give it a go.”
The company hired installers and sales inspectors to support the new venture and it has paid off. The insulation services portion of their business has experienced steady growth since they added the service in April 2010 and now makes up 7 percent of the company’s overall revenue.
“We took advantage of the marketing tools and support TAP offered, and each year our inspectors gained more confidence and are getting in front of more potential customers,” says Wilson.
Wilson cautions, however, that adding insulation installation and removal services isn’t for companies simply looking to “try something new” and that they must be willing to make the investment in equipment and people to receive the maximum benefit.
Pacific Coast markets TAP insulation alongside its other services when presenting to a customer and as the numbers indicate, the response has been positive.
“Consumers will spend a good amount to ensure the comfort of their family or customers,” says Grande. “They are willing to invest in the comfort as well as enjoy the energy cost savings that come with a better insulated home.”
Grande says one of the best sales tools his inspectors have is when they show the customer damaged insulation full of feces as a result of a rodent or wildlife infestation in their attic.
“Our customers like the convenience of having one company be able to protect their home from termites and rodents, as well as give them comfort in their insulation,” says Wilson. “In our market we come across many homes that are under insulated or have no insulation at all.”