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Start-Up Diaries: Jumping Pump Prices is a Gas
1 May, 2008 By: Peter F. Schopen Jr. Pest Management ProfessionalIf you are a small business owner like me, you are only too aware of gas prices. During the past few months, the cost for a gallon of gas has increased by more than a dollar, depending on where you live. By the time you read this article, it is a real possibility that my market, Chicago, will have hit the $4-per-gallon mark for regular unleaded gasoline. As I write this, gas has already reached $4.09 for Premium.
 Peter F. Schopen Jr. |
It isn't just the small operators who feel the pinch. Recently a large chemical supplier threatened to take me to collections for falling 50 days behind on two bills that total $265. It was embarrassing to be harassed like that by people from whom I have been buying for 10 years — two with Schopen Pest Solutions and eight with Mid Central Pest Control. But that is the climate of our economy right now. A company like mine is paying more for gas, which means some of the bills go out a few days past the 30-day net. In return, a multi-billion dollar company feels the need to come after me for $265.
So what can pest management professionals (PMPs) do besides riding bikes to work? Raise our rates? Start burning low-grade vodka? Send the National Pest Management Association's Bob Rosenberg to the Middle East to negotiate with OPEC countries? There are many ideas and solutions that have been batted around over the last two years; let's revisit a few.
1. First, and most important, route your customers efficiently. I try to keep my driving to 60 miles per day or less for 10 to 14 stops. This does not include getting to the first client. Some of my customers live 30 to 40 miles away from my office. But once I am in a town, I try to have my clients lined up within a few miles — or even a few blocks — of one another.
2. Use gas-electric hybrid vehicles or alcohol-blend fuels.
Pest Management Professional had a great article on this subject in its August 2007 Business Technology section. (Also, check out this month's Truck Guide.)
3. Use grocery store gas stations. Several grocery-store chains offer gasoline now. Many also have discount cards that you can use at the pump. On the average, you'll probably save 3 or 4 cents per gallon. Also, look for gas stations that offer 10 cents off per gallon if you use their car wash.
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4. Stay close to home. I mentioned above that I sometimes drive 40 miles to get to my first client. I know of a couple of PMPs who simply refuse to drive more than 20 miles from their offices. They focus all of their attention on their hometown.
5. Refer work to other PMPs. Recently, I had a client that I couldn't get to in a reasonable amount of time. I didn't want to lose this customer, so I called a medium-sized company colleague and sub-contracted the work to them for one service. My client was happy because I responded quickly, and I still earned $40 for the job. If you start sub-contracting work, however, make sure the other PMP is someone you trust — or put together a contract.
6. Set up a referral program with your clients. Going back to No. 1, routing your clients is a heck of a lot easier if you're servicing several customers on one street. I offer a $25 referral fee to my clients if they refer me to their friends and neighbors. I mail them the voucher once the work from their referral is completed. As a result, I often have days where my entire route is in one subdivision.
If you listened to my PMP podcast recently, you know that I believe we still have a long way to go before gas costs level off. As long as China and other developing countries continue to buy oil at record levels and the U.S. dollar slips farther and farther, oil prices will continue to climb.
Schopen is owner of McHenry, Ill.-based Schopen Pest Solutions. You can reach him at 847-529-BUGS or
pete@schopenpest.com.
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