- February 9, 2019
- Posted by: admin
- Category: Accounting Advice
Building a customer list is an important factor when building a pest control company. Having been in the pest control business for many years, I’ve been able to observe some very successful and unsuccessful pest control companies. My experience started in a brand new pest control start up which eventually grew and was merged into a multi-branch, multi million dollar operation.
What I’ve noticed in the pest control industry is that there are a lot of small companies who have been in business and remained small for many years. There are also companies that have grown exponentially in a few short years. There is a difference in the thinking of the small company owner and the growing company owner.
The growing company owner not only has to be an expert in pest control, he must also be an expert in management. He must be able to manage people, a growing customer list and the detailed information that flows in and out of his firm. This article will focus on how to manage the information and back office work in an organized manner to allow the growth that interests many owners.
The pest control business is not a high margin business. Rather it is a moderate margin business, where you generate high profits from customers that use your service on a scheduled recurring basis. In other words, you don’t hit a home run with each customer and move on to the next as perhaps a car salesman or a real estate agent might. You foster a relationship with your customer that is ongoing based on your ability to meet their needs in terms of quality and perceived value. Many small company owners believe that you will lose the personal touch as you grow. It doesn’t have to be that way if you manage your customer list correctly and develop office procedures to manage the growth.
Building A Customer List
If we could compare the Pest Control business to a manufacturing business where machinery is used, the Pest Firm’s machinery is his customer list. As this list builds, it must be treated in a prudent manner like any other asset used in business. Therefore the back office work in a pest management firm should be focused on building, maintaining, and nurturing this customer list in order to facilitate its growth. It goes without saying that each customer on this list should be serviced properly in terms of fieldwork.
But it is just as easy to lose a customer because of poor office work (i.e. over billing, incorrect scheduling, not returning phone calls in a timely manner, etc.) as it is to lose a customer for poor field service.
Your Customer List: Making more with what you have:
If we continue the machinery comparison, we know that a well tuned, well maintained machine would produce at a more efficient level, allowing greater output. A well maintained customer list would also produce more output by showing key statistics about a customer (i.e. dollars per hour, types of services provided for a customer, renewal dates, etc.) Having this type of information at your fingertips allows you to determine whether other services might be appropriate for a customer or whether a particular customer might be a candidate for a price increase.
By manipulating your customer information you can spot certain trends. For example, one firm that I’ve done some work with was able to capitalize on an outbreak of Cicada Killers that were tearing apart customer lawns due to their nesting habits. This particular PMP noticed that he was receiving calls from this particular neighborhood and was able to contact his other customers in the area to offer to provide additional service to control the outbreak.
By querying his customer list and formulating a quick letter, this PMP was able to generate several thousand dollars in new business. The whole process took only a few minutes. The fact that his customer list was well maintained allowed him to capitalize on this situation with almost no effort.
Managing your Customer List:
What Information needs to be managed?As you grow it becomes increasingly difficult to manage this list. However with the aid of computers we are better able to manage this information. It’s not enough to buy fancy computers. The successful firm has established office procedures with respect to the data input. You see the data put in the computer must be accurate in terms of:
- Customer Information – Name, Address, Phone, etc.
- Financial Information – Amount charged for service, customer payments, accounts receivable and dollars Charged per hour of work.
- Service Information –Time and date of services, materials applied, technician that performed the service, areas treated, customer recommendations, etc.
One of the best ways of managing Information is what I call Management by Checklist. The checklist approach allows you to see what needs to be done and to complete those tasks in an appropriate time frame. Without an organized approach to office work we have no priorities in completing work that needs to be done.
A prime example of this is the office worker who has so many piles on his or her desk, and has so many projects in process but never completes any. The reason that nothing is accomplished is there are no set of priorities and no clear-cut method to get things accomplished.
Below is an example of a checklist that is used on a daily basis to enter customer information into the computer. A Checklist can be developed to aid in the management of any project or group of tasks.
Implement a Checklist to your Customer List!
Checklists can be used for managing any project or ongoing procedures. The best way to develop a checklist is to:
- Determine a time frame with which all tasks must be finished (i.e. Daily Procedures, Weekly Procedures, Monthly Procedures, etc.)
- Determine what tasks need to be completed over the time frame (i.e. Customer Entry, Service Entry, and Financial Entry).
- List those specific procedures that need to be completed in order to finish the project.
As a pest management firm grows, managing pests becomes only a part of the overall game. Effective People management, Prudent Customer List Management, and Office Management that provides clean accurate information becomes paramount in the success of your firm. As these functions become more difficult because of volume, management tools such as the use of computers and checklists become an extremely effective technique for accomplishing your objectives.
Daily Office Procedures Checklist:
- Technician Check In – Check all paperwork from jobs performed for the current day.
- Enter New Customers and Sales Prospects into the Computer.
- Deactivate Customers who have cancelled service.
- Enter Sales Commissions for technicians or salesmen on Commissionable Sales.
- Enter Service Tickets (Work Orders) for new jobs that have been sold.
- Make sure renewals are set up for any renewable work that has been sold.
- Print Service Orders and technician appointment listing for Next Day. Determine if the amount of work to be performed is adequate.
- Post work to computer for work completed the prior day.
- Reprint Service order forecast by technician for the prior day. On a daily basis, there should be no service orders outstanding except for those technicians that hand their work in weekly and estimate tickets.
- Apply Customer Payments as Payments are received.