President, The Bugmaster
“I couldn’t imagine operating the business now without them”
Approx. $7.3M in 2020 revenue
“Even if you’re not planning on selling your business anytime soon, part of the job of a CEO is to make sure the business value grows over time. You’re only going to be able to accomplish that if you understand what things add value to the business. We are in no way, shape or form on the market, but I am happy to know that if we were going to market, I have everything in place. Having a partner like PCO Bookkeepers is really valuable for that.”
An invaluable investment
The Bugmaster, which is celebrating its 40th year in business, has undergone quite a transformation over the last several years, according to President Dauphin Ewart. His father, Ned Ewart, founded the Austin, Texas-based pest control company in 1981 with a VW Beetle as its first service vehicle.
Back then, the company focused on commercial accounts like restaurants because Ned could sell to them during the day and service them at night. Today, The Bugmaster serves commercial, residential and multifamily accounts, offering general pest, termite, wildlife and bird control.
About five years ago, Dauphin sought help understanding and tightening up the firm’s financials as it evolved. The company’s annual revenue has grown from $4 million when he joined the business in 2005 to approximately $7.3 million today.
“We grew from a company that had a sales culture — sort of a ‘revenue forgives all sins’ perspective, where you just go out and grow,” Dauphin says. “Having tight financials was never really one of our strengths. We knew fundamentally that we made money every month, but getting into details about how that came about wasn’t part of it for us.”
He knew that mentality needed to change as the company scaled up, so he turned to PCO Bookkeepers, which works with more than 300 pest control companies across the U.S. to provide accounting, bookkeeping and CFO services; tax preparation and planning; and accounts payable management. Along with these offerings, PCO Bookkeepers clients receive in-depth monthly benchmarking reports that compare them to other firms in pest control industry.
The Bugmaster had always employed an internal bookkeeper and an outside CPA, but the company had never had a CFO or someone to provide high-level financial advice.
“My CPA’s take was always, ‘Whatever you decide to do we can write that into the taxes,’” Dauphin says. “They would definitely keep me out of jail, which is valuable, but it’s not helpful financial guidance.”
What he needed — and got — from PCO Bookkeepers was a resource for financial planning answers, operational advice and industry benchmarking information.
“I think of PCO Bookkeepers as a virtual CFO,” Dauphin says. “Honestly, it was one of those gaps that I didn’t know I had before I filled it. I couldn’t imagine operating the business now without them.”
For instance, in late 2018 the The Bugmaster was having strong growth but poor profitability. It turns out, sales and marketing expenses were too high for the level of growth the firm was experiencing.
Working with Anthony Pepe, managing member of PCO Bookkeepers, Dauphin learned he needed to change his sales process, which previously ran every dollar through the sales organization, driving up commission expenses. That revelation led to training the customer service team to provide quotes over the phone.
“Without having a financial dashboard and seeing that this was the most important area to fix our profitability, it would have been harder to commit to the change,” he says, adding the company took back several profitability points that year.
“Working with PCO Bookkeepers is an investment,” Dauphin says. “Like any investment, you would expect it to pay off. No one has a deeper understanding of what the financials of a pest control company should look like than PCO Bookkeepers. They can quickly look at your P&L and say, ‘This is where my concern is.’ That’s an invaluable conversation to have as a business owner.”