We asked pest managers to tell us their thoughts on the state of the pest control industry as it stands in 2024.
With the current economic situation impacting customer spending habits, Professional Pest Manager magazine thought it was a good time to carry out a Pest Pulse survey and get feedback from businesses on the state of the pest control industry in 2024.
Just over 100 businesses responded to the survey. When looking at overall sales, 41% businesses said sales were better than 2023, 32% thought they were about the same and 27% said they were lower than 2023. Of those claiming sales were up on 2023, the average increase in sales was 18.6%. Of those stating sales were down, on average they were down 26%.
The market segment that seems to be going from strength to strength is termite management. Nearly half of respondents said that termite work was up on 2023, with less than a third saying general pest services and commercial pest control were higher (Figure 1). Even for companies with overall sales down on 2023, 30% said termite sales were up.
On the other side of the equation, it appears that residential pest control is the segment that has taken the biggest hit, with just over a third of respondents saying sales were down. For businesses with sales down on last year, residential pest control was down for two thirds of respondents. Even for the businesses that said overall sales were up, 20% of these businesses reported that residential pest control was down. With the economy hitting discretional spend, especially with mortgage holders, it is perhaps not surprising that many are giving their annual pest treatment a miss.
Given that nearly three quarters of companies said sales were the same or higher than last year, most respondents (54%) were not looking to reduce costs. Of those there were, they were looking to marketing (22%), advertising (21%) and SEO support (18%) to find cost savings. Cost cutting in these areas needs to be done with care, as it has clearly has the potential to reduce sales, creating a downward business spiral.
Although a number of businesses were looking to cut costs, they were not looking to reduce staff. Only 6% of businesses said they were looking to reduce staff, with 57% saying they would be keeping staffing levels the same. However, with a number of businesses experiencing significant growth, some 37% were actually looking to recruit, although successful recruiting in the tight labour market remains a challenge.
Cost of goods and labour are going up, a fact reflected in that twice as many businesses feel prices are increasing rather than decreasing (37% v 17%), with 46% feeling they are staying the same. With cost-of-living pressures impacting residential customers, it may be tempting for some businesses to reduce prices to retain customers (generally not a good idea). However, more than half of respondents are considering increasing prices (54%), with 43% holding prices at the same level and only 3% looking to reduce prices.
Overall, respondents gave an average score of 6 out 10 for how optimistic they felt about the business environment over the next 12 months. However, there was a lot of variation ranging from 0 to 10 out of 10 (Figure 2).
A third of respondents were pretty optimistic about the future and gave a score of 8 or more, out of 10, but at the other end of the scale, 25% of respondents were more pessimistic and gave a score of 4 or less, out of 10. There didn’t appear to be much variation by locality (city v regional/rural locations), and all but one of the states had a similar score to the average. The obvious outlier was WA, with an average score of 7.5/10. Possibly this is as a result of the ongoing resources boom in WA.
Undoubtedly there are some businesses doing it tough, especially those with residential pest control forming a large part of their total sales, yet the overall picture is quite positive, despite the challenging economic conditions.
Professional Pest Manager magazine would like to thank the many pest managers who participated in the survey.
