Jay Turner offers advice to pest managers about how to rustle up new business opportunities during the quieter off-peak season.
Everybody in the pest management industry knows that business typically slows down in winter often making it a very stressful period, especially for new and growing businesses. Most pest management companies have to take steps to ensure their financial survival during this ‘off season’, until it picks up again in the warmer months when the pest activity ramps up.
In the beginning our business in Noosa was no different, even though the winter is shorter up here in the Sunshine State. However, by implementing a few different strategies it helped to even out our turnover through these changes in the season. By no means am I claiming to be any sort financial advisor or business coach, but the following strategies worked for us. We are sharing these to hopefully help some of our fellow pest managers.
Many companies use the winter months to focus on training, equipment maintenance and of course taking annual leave. These are all necessary activities and clearly the quieter months are the best time to implement, they fail to bring in revenue.
Another common strategy is to up the ante on your marketing, such as networking and promotional offers, but they can also eat into your profit margin. In the early days we too succumbed to the easy option of discounting, just to keep our techs busy, but in hindsight this discounting did more damage than good to our business’ reputation. But such is business, learning from your mistakes and moving forward again.
Some companies even diversify in the services they may offer, expanding into bird or vertebrate pest management, or further afield into carpet cleaning, pressure cleaning and the list goes on. The problem with this strategy, in my opinion, is that this work will most likely roll over into your busy season putting added pressure on to what is likely already busy summer workload. This is not necessarily a bad problem to have, but it then becomes a vicious cycle – you will need more resources for the summer months, which you need to keep busy the following winter. I am also a big believer in focusing on what you are good at – poor service provided on a service that is not your main area of expertise can still reflect badly on your whole business.
If you have the room for storage, an easy step we took in our first few years of business was to stock up on product through the summer, when cash flow was good. It was no big deal to order an extra bottle here and there with my normal order, and take advantage of the regular specials from your supplier and put aside for winter. It was not unusual for me to not need to order any stock for several months over winter.
Pay your bills when cash flow is good. Of course, this is not as simple as it sounds, but there are some bills that can be paid in lump sum payments rather than monthly instalments. Try and make the payments during the summer to reduce your outgoings though winter. And of course my favourite is to prepay your annual holidays. If you pay for your flights and accommodation in advance, that way come winter you are committed to go on holidays and you only don’t have to stress about finding the money to pay for it all, just your spending money!
A key revenue building strategy is to grow your bread and butter portfolio. For most of us this means commercial contracts, those that require regular monthly or bimonthly services. These may include restaurants (pictured above), warehouses, industrial and even termite baiting and monitoring contracts. This can provide a similar summer resourcing issue to diversifying, but at least it provides regular and guaranteed income for winter.
However, by far our most successful strategy has focused on growth within our existing client base rather than looking for new clients. Spend time going through your database and look for those big annual contracts, which have the potential to be moved into your slow season. By big annual contracts, I mean those typical strata managed properties, such as multi-unit complexes. This method has a doubling affect – for every day’s work you can move to your slow season is a day’s work freed up in your busy season to take on more work when it is plentiful. This can be done gradually a month at a time over a few years or in one go by a few months. After that it simply comes around each year at the same time.
Obviously changing the dates a service is due doesn’t come without some resistance. But an easy strategy is to send the proposal well in advance of the next service at a slightly higher cost than the previous year’s service, but then offer the same price as last year on the proviso they get the service done on an agreed date/s during your slow season. Providing they are more than happy with your previous years’ service, most will jump at the opportunity. This is not necessarily discounting, as typically most contracts will remain the same price for a few years before a price hike, but the client doesn’t know this.
Another method we have recently implemented for our domestic client base is offering a mid-year treatment. For most customers, domestic household sprays are typically performed just once a year. But for the past 18 months we have been emailing our domestic clients six months after their treatment was performed to extend their free service period if we came back and retreated just the externals of their house. Amazingly this has been received really well, with many loving the additional service, including our property managers.
Winter-proofing your business is not an easy task nor is it a quick task, but gradually as each year passes your business will hopefully grow and become financially stable all year round. Remember there is no business like pest business!
Jay Turner, Laguna Pest Control