If left unchecked, pests like rodents, insects, and wildlife can cause extensive property damage and health hazards. As a result, there is a strong demand for professional pest control services to eliminate these nuisance creatures and prevent future infestations. If you enjoy helping people, solving problems, and have great attention to detail, then starting a pest control business might be right for you.
Starting a pest control business involves much more than knowing how to exterminate bugs or rodents. It’s a journey with many steps, each critical to your long-term success. To help you get started, our guide gives a clear idea of the industry, how to get started, and answers to common questions.
At its core, a pest control business offers specialized services to rid homes, offices, and outdoor spaces of various types of pests. Pest management is a broad field, and pest control businesses may specialize in certain types of pests or use certain treatment and prevention methods, such as poison or natural baits. Some businesses also cater to commercial businesses needing pest control, while others market to residential needs.
Pest management may address all sorts of animals, including bed bugs, ants, termites, rats, mice, roaches, spiders, and more. According to the National Pest Management Association, infestations can compromise a building’s structural integrity and overall safety. Pest control also helps to protect the food supply and the health of the public.
Running a pest control business is tough work, mainly because of the working conditions. Pests are often in hard-to-reach areas like crawlspaces and attics, and you may need to access those spaces in the hot summer or cold winter. This job can have health implications, too, if you inadvertently bring pests home with you, such as when treating bed bugs.
While many entrepreneurs may choose to start their own pest control businesses, large existing pest control companies offer franchise opportunities that can streamline the process a bit.
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The $26.2 billion pest control industry provides inspection, extermination, and prevention services for residential and commercial clients. As people are becoming more aware of health risks posed by pests, climate change and increased urbanization, the pest control industry shows no signs of slowing down.
Major services include controlling rodents, insects, termites, and wildlife. To succeed, pest control businesses need qualified technicians, proper equipment and chemicals, licensing, insurance, effective marketing, and quality customer service. The industry has low barriers to entry but is regulated by state and federal agencies due to the use of hazardous pesticides.
Steps To Start A Pest Control Business
Starting a pest control business allows you to be your own boss in an industry with growing demand. While launching a successful company takes research, training, and investment, the profitability and flexibility can make the effort rewarding. This overview summarizes key steps and considerations to help you start out right.
Step 1: Assess the Market
Before you even think about investing in tools or printing business cards, the very first step in starting a pest control business is understanding your market. You’re about to enter a field with many players – some big, some small, and plenty in between. Each is vying for the attention of the same audience you hope to serve. So, the big question is, “Is there room for one more?” Here’s some ways to find out.
Assess the Local Pest Landscape
You’ll want to start by looking into the common pests in your target area. Is it a hotbed for termites, roaches, or rodents? Are there unique pests that only seem to plague your region? Understanding what you’re up against can help you specialize your services, setting you apart from competitors who might offer more generalized solutions.
Identify Your Competition
A thorough Google search or a glance through local business directories can provide you with a list of competitors in the area. What services do they offer? What do their customer reviews look like? This can give you a sense of the market’s saturation and areas where you might be able to offer something different or better.
Conduct Surveys or Interviews
If you can, consider running a local survey or even informal interviews with residents. Ask them about their experiences with pest control services. What did they like? What didn’t they like? Do they feel like their needs are being met? This firsthand information can provide invaluable insights into gaps in the market that you can fill.
Use online tools to gauge interest in pest control services in your region. Google Trends or keyword research tools can show you how many people are searching for these services. High search volumes are generally a good sign, but remember, it may also mean more competition.
What Sets You Apart?
Finally, determine your unique selling proposition. In a competitive market, differentiation is key. Think about what unique value you can provide to customers. Maybe you can specialize in eco-friendly methods that others don’t offer. Perhaps you have years of experience in pest control in similar climates and can offer specialized advice that newcomers can’t. Or it could be something as simple as providing top-notch customer service, which is often lacking in industries where the work is “dirty.”
Step 2: Write a Business Plan
After getting a better understanding of the market and where you are most likely to succeed, the next step is to write a business plan. A business plan is like setting up a roadmap for your journey. It not only helps you navigate the ins and outs of your business but also serves as a document that lenders can review to understand its potential.
All of the sections in the plan are important, but here are the sections that I feel deserve special focus when seeking funding.
Market analysis: This section is your chance to show that you’ve done your homework. You need to paint a clear picture of the market landscape, competition, and, most importantly, why your business has the edge. Lenders want to see you’ve identified a gap or an unmet need in the market and that your services are wanted by customers.
Management team: Banks and other lending institutions pay special attention to who is running the business. Why? Because businesses aren’t faceless entities; they’re driven by people, and the competence of your management team is often a reliable indicator of your business’s potential success. In this section, outline the experience, qualifications, and roles of each key team member, including owners.
Financial projections: When it comes to getting a loan, nothing speaks louder than numbers. This section will be scrutinized by lenders who want to see not just profitability but also the feasibility of your financial projections. Are your revenue forecasts reasonable? Have you accounted for all potential expenses? And most importantly, do you understand these numbers? You’ll need to explain your projections in detail, so be prepared.
Before you put the plan in front of a lender, it’s a good idea to have another pair of eyes look at it, ideally someone with business or financial expertise. They can offer insights you might have missed and question assumptions you’ve made, giving you a chance to refine the plan further.
Related: How to write a business plan
Step 3: Source Funding
You’ve validated the market and nailed down a solid business plan. The next hurdle is securing the funds to kick-start your venture. It’s essential to ensure that funds are in place before moving ahead with other steps like buying equipment or leasing a location. Let’s look into the most common funding options for a pest control business.
Funding for a new business starts with the owner’s savings. If your savings can’t cover all startup costs, you’ll need to look for external funding. It’s the most straightforward source of funding, but if your savings don’t cover all startup costs, looking towards outside funding becomes necessary.
Banks and credit unions are common go-to options when funding is needed for small businesses. They often require borrowers to invest between 15% and 25% of their personal funds towards the total cost of the project, have a good credit score, collateral, and a solid business plan. If the bank finds your loan request a bit too risky, they might lean on an SBA (Small Business Administration) loan guarantee to offset that risk, thereby increasing your chances of loan approval.
Friends and Family
Another avenue to explore is borrowing from friends and family. While this option may offer more lenient terms, it comes with its own set of challenges, especially concerning relationships. To keep things professional and safeguard your personal relationships, always put agreements in writing, complete with terms, interest rates, and repayment plans.
If you find that your funding needs are relatively modest, or perhaps you’re unable to secure a loan through traditional lenders, microloans can be an option. Some organizations offering microloans also provide business training alongside the funding, which can be particularly beneficial for those new to running a business.
Step 4: Register the Business
Starting a pest control business involves several legal steps. Here’s a general overview to help you navigate the process:
Choose a business structure: The first step in the business registration phase is choosing a business structure. This decision will impact your tax obligations, liability, and day-to-day operations. The four main types of business structures are sole proprietorship, partnership, corporation, and Limited Liability Company (LLC).
- Sole proprietorship: This is the simplest business structure. It’s easy to set up and has the lowest startup costs. However, it doesn’t offer any personal liability protection.
- Partnership: This structure is used when two or more people own a business together. Like a sole proprietorship, it’s relatively simple and inexpensive to set up but offers limited liability protection.
- Corporation: A corporation is a separate legal entity from its owners, offering them personal liability protection. However, it’s more complex and costly to set up and has more stringent administrative requirements.
- Limited Liability Company (LLC): An LLC combines the liability protection of a corporation with the simplicity of a sole proprietorship and partnership.
While each business type has pros and cons, many pest control businesses choose to form an LLC because it provides liability protection and is simpler to manage than a corporation.
Related: Comparison of business structures
Forming an LLC sounds complicated and expensive, but using an entity formation service guides you through the process so you know it was done right.
Some popular LLC formation services include:
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Business name registration: After registering the business structure, you may need to register your business name. This process will vary depending on what business structure you pick. Sole proprietors and partnerships will often be required to register a “Doing Business As” (DBA), while corporations and LLCs register with the state during the formation process.
During this time, it’s also a good idea to check if the name you want is available as a web domain, even if you’re not ready to set up a website yet.
Obtain business licenses and permits: To operate a pest control business in most states, you will need an exterminator license. The procedures, requirements, and fees to get this license will vary from state to state, so it’s best to check with your state’s governing body to understand the certification requirements. In most cases, you’ll need to take a pesticide application course, then sign up for and pass the state’s examination. Once you’ve passed the examination, you’ll fill out an application and pay a fee for your license.
A pest control business owner also needs to attain any general business licenses or permits required by their town and state, such as a sales tax permit, Employer Identification Number, and Occupancy Permit.
Step 5: Set Up Operations
Setting up operations for a pest control business, whether as a solo operation from home or leasing office space, requires careful planning and execution. For a solo operation, you’ll need a dedicated space at home to store your equipment safely and securely. Your home office should be equipped with basic office supplies, a computer, printer, phone, and filing system for customer information, invoices, and regulatory paperwork.
If you’re considering leasing office space, you’ll need to factor in additional costs such as rent, utilities, office furnishings, and possibly additional staff. The office space should have enough room to store all your equipment and paperwork securely.
Your next focus will be acquiring the necessary equipment for pest control services, which may include pest control chemicals, sprayers, traps, safety gear, and a vehicle for transportation.
Next, you’ll need to establish your pricing and billing processes. Consider the costs of your supplies, equipment, and labor when creating your pricing structure. You may choose to charge by the hour, per treatment, or based on a package deal. Additionally, establish billing processes so that you can easily and accurately bill your customers.
Step 6: Hire Staff
If you’re planning to hire employees for your pest control business, it’s necessary to understand the requirements as an employer. Typically, you’ll be looking at hiring technicians to carry out pest control services, administrative staff for office tasks, and potentially a sales team for business growth.
Before you start hiring, you’ll need to meet a few legal requirements.
Before you can hire employees, there are several legal steps you must take:
- Obtain an Employer Identification Number (EIN): This is a unique number assigned by the IRS that you’ll use when paying taxes and reporting information about your employees.
- Verify employment eligibility: Under federal law, you must verify that every new employee is legally eligible to work in the United States. This typically involves completing an I-9 form for each employee.
- State reporting: You’ll need to report your new hires to your state’s New Hire Reporting Program. The specific requirements vary by state.
- Workers’ compensation: Most states require businesses with employees to carry workers’ compensation insurance, which provides benefits to employees who get sick or injured on the job.
- Labor laws: Familiarize yourself with both federal and state labor laws. These cover areas like minimum wage, overtime, meal breaks, and more.
Related: Hiring your first employee
Step 7: Create a Marketing Strategy
The good news is that many customers become recurring pest control customers, but a business still needs to market in order to bring in new customers. So, as you prepare to launch your pest control business, it’s important to have a marketing plan in place.
Online marketing is a powerful tool for reaching potential customers. Start with building a professional website that showcases your services and provides valuable information about pest control. Optimize your website for search engines (SEO) to improve its visibility in search results.
Paid online advertising can be an effective way to reach a larger audience. This could include pay-per-click ads on search engines or sponsored posts on social media. Additionally, creating engaging content like videos or infographics can help attract and retain customers.
Another popular online marketing strategy is to claim your business on relevant online business directories such as Google My Business, Yelp, and Angi. This helps increase your business’s online visibility and allows customers to leave reviews, which can boost your reputation.
Social media platforms like Facebook and Twitter are also useful for connecting with potential customers and promoting your services. You can share helpful tips, offer special promotions, and engage with followers to build relationships and trust.
Offline, consider joining your local Chamber of Commerce. This can provide networking opportunities and help establish your business within the local community. Attending events and participating in community activities can also raise your business’s profile and lead to valuable word-of-mouth referrals.
Step 8: Prepare to Launch!
As you finalize your plans to start a pest control business, there are several additional steps you may need to take. The steps you need will vary, but here is a list of some common ones:
Business insurance: Ensure you have the necessary business insurance in place. This often includes liability insurance and workers’ compensation insurance.
Bookkeeping: You’ll want a system that can handle invoicing, track expenses, and generate financial reports. Software like Wave Accounting (FREE) or Quickbooks can help manage these tasks efficiently.
Contracts: You’ll need contracts for your customers outlining the services you’ll provide, pricing, and terms of service. Industry-specific contracts might include residential or commercial service agreements, bed bug treatment agreements, and termite warranty contracts. RocketLawyer and Law Depot have free and inexpensive templates that may be helpful.
Business bank account: Open a separate bank account for your business to keep your personal and business finances separate.
Industry associations: Joining industry associations like the National Pest Management Association or your local state pest control association can provide valuable resources, networking opportunities, and credibility
Common Questions When Starting A Pest Control Business
How much does it cost to start a pest control business?
The average cost to start a pest control business can range from $6,000 to $50,000, depending on the scale of your operations and services offered. Initial costs will include licensing fees, equipment purchases, insurance, marketing expenses, and working capital.
Business registration and licenses: Registering your business can cost between $100 and $800, depending on your state and the business structure you choose. Licensing fees can add another $300 to $500.
Location costs: Renting an office space can cost anywhere from $500 to $3,000 per month, depending on location and size. Often, landlords require first and last month’s rent as a deposit, so that’s an initial outlay you should be prepared for.
Equipment costs: You’ll need sprayers, foggers, safety gear, and chemicals. Expect to spend around $3,000 to $7,000 for equipment and initial chemical stock.
Vehicle costs: If a vehicle is needed, a service vehicle outfitted for pest control could range from $15,000 to $30,000.
Insurance costs: For initial insurance packages covering liability and property, you may need to set aside $600 to $1,200.
Marketing costs: Initial marketing efforts, which include website development, business cards, and perhaps some online advertising, can cost about $2,000 to $4,000.
Miscellaneous costs: This includes small but necessary items like office supplies, which may cost around $200 to $500 initially.
How profitable is a pest control business?
According to industry statistics, the “average” pest control service generates $885,000 in annual revenue.
Profit margins for the industry typically range from 9% to 15%. Using a 12% pre-tax profit margin, a pest control company with $885,000 in revenue could expect to produce around $106,000 in profit.
The math looks like this based on common industry benchmarks:
Total Revenue: $885,000
– Cost of Goods Sold: $354,000 (Average 40% of revenue)
– Payroll: $336,300 (38% of revenue)
– Overhead $88,500 (10% of revenue)
Total Operating Expenses: $778,800
Pre-Tax Profit: Total Revenue – Cost of Goods Sold – Payroll – Overhead
Pre-Tax Profit = $885,000 – $354,000 – $336,000 – $88,500 = $106,200
What skills are needed to run a pest control business?
You don’t need a business degree to start a pest control business, but certain skills and experiences can contribute to your chances of success.
Pest control experience: The more experience that a business owner has in pest control, the better. Apprenticing under or working with a professional pest control company will give a business owner valuable skills and knowledge to apply in their business. Experience in pest control and knowledge of the chemicals used can also increase a business owner’s chances of passing the exam required for a pest control license.
Attention to detail: Identifying pest issues and finding the best control strategy is all about details, and when handling chemicals, absolute attention to detail is necessary for an effective yet safe application.
Customer service skills: From answering the phone to presenting a professional demeanor during a service appointment, a pest control business owner needs strong customer service skills. Good customer service will contribute to the business’s reputation, making this skill particularly important.
Sales skills: A pest control business owner who has some sales experience can increase the business’ profits by upselling services, such as by encouraging customers to sign up for a multi-month maintenance plan.
Management experience: If a business hires employees, the owner should have some management experience in areas like conducting interviews, training, and managing staff.
Physical stamina: Pest control is a physically demanding job and may require climbing, kneeling, crawling, and more. An owner will need good physical stamina to get through multiple appointments each day.
How long does it take to get licensed to provide pest control services?
The timeline for obtaining a pest control license varies depending on the jurisdiction, specific requirements, and the type of license you’re pursuing. Generally, you can expect the process to take anywhere from a few months to a year or more.
National Pest Management Association