Pest Management Professional, August 2011

bandits S tuart Aust used to ride high in the saddle in his Hummer But with gas prices 1 per gallon higher than last summer Aust is now a bigger a fan of the companys four VW Beetles than he is of the civilian tank he used to commandeer Thank God I traded in my 7 mile per gallon Hummer last summer says Aust owner of a growing Paramus N J based business that includes Bug Doctor Termite Pest Control Bird Doctor Nationwide Animal Doctor Mosquito Doctor and Bedbug Doctor We spent as much on fuel the first six months of this year as we did for all of 2009 Bug Doctor isnt alone Fridley Minn based Plunketts Pest Control spent about 1 million on fuel in 2010 and the companys on track to spend 50 percent more on fuel this year according to Stacy OReilly Plunketts president Plunketts fleet comprises more than 300 vehicles primarily Chevy Colorados but OReilly wants to move Plunketts toward smaller fourcylinder fuel efficient pickup trucks Paul Youngpeter director of fleet management for Rollins projects the company will spend 25 to 30 percent more on fuel this year Orkin just one of Rollins subsidiaries has a fleet numbering about 7200 vehicles The glass is half full Gas price hikes typically dont hit pest management professionals PMPs as hard as they do landscape contractors who also rely on fuel to power their mowers and handheld equipment But anytime a fleetoriented business has to endure a recession and a 35 percent jump in fuel prices it demands attention and operational changes Few escape unscathed Most PMPs and most of their customers have been hit hard by skyrocketing prices at the pump Nevertheless PMPs refuse to succumb to the stranglehold of the one armed bandit Sixty nine percent have increased pricing 2 to 10 percent on their products and services to combat rising fuel prices according to a May 2011 online survey by Pest Management Professional pmp magazine Twenty one percent have enacted fuel surcharges averaging 5 per visit and 10 percent have enacted layoffs or pay cuts Surcharges price hikes Plunketts experimented briefly with fuel surcharges largely because its long term service contracts contain pricing structured before fuel prices rose 35 percent OReilly says But the company quickly shied away from its surcharge strategy because of customer push back Weve only recently begun to increase new customer pricing because of the push backs weve been getting as we try to renegotiate current contracts she says As for Plunketts clients not under contract word of the necessary price increase was delivered via the companys newsletter and a followup reminder attached to impacted customers invoices a month before the changes were implemented James P McHale president and CEO of Buchanan New York based J P McHale Pest Management also briefly tested a fuel surcharge Our customers werent at all receptive to the idea McHale says They felt cheated because theyre already paying much more for their own vehicles fuel McHale found less customer tension when implementing price increases specific to each client Hannah City Ill based American Pest Control hiked prices 5 to 10 percent earlier this year according to Doug Hillman residential supervisor The move was communicated on site one on one with each client We received few complaints Hillman says Price increases work much better when technicians have close customer relationships do quality work and clearly communicate the needs for the changes Bug Doctor successfully implemented a 5 per trip fuel surcharge on all residential and commercial services Aust made the fuel surcharge move when gas prices rose to 4 per gallon earlier this year He communicated the decision by sending a notice to clients that also made it clear there would be no price increases In 2006 business was looking good for Keith Etheridge president and owner of Chino Calif based Contractors Termite Pest Control which was 55 people strong and growing But that was about to change That same year the U S economy took a nosedive gas prices soared and the ripple effects have been fierce and far reaching mypmp net Pest Management Professional August 2011 15