How to work on, not in, your business

Much has been written about the importance of working “on” your business vs. working “in” your business. What does this really mean to pest management professionals (PMPs)?

In the beginning, out of necessity, many PMPs start their businesses with one truck. You serve as the technician, sales rep, office administrator and, if you have time to think, marketer. This becomes a constant cycle that’s hard to break without a conscious effort to change. Otherwise, you’ve basically just built a job for yourself.

If you’re checking customer messages, returning phone calls, hopping in the truck to complete a route, fixing broken equipment and more, you’re working “in” your business. By contrast, when you develop strategic plans around how to grow to a second truck and beyond, you’ve transitioned to working “on” your business. It does require focus and diligence, however.

Regardless of company size, every pest control business owner should spend time working on their business and then implementing their plan day after day.

1. Build your business plan

Mike Sisti

First, understand you have a primary service to offer. For most, this is the quarterly service plan, which is the main reason a prospect becomes a customer. Once that is defined, how many of those customers do you have? What is the mix of residential and commercial? (You may want to keep the commercial customers separate). What is your retention rate?

Use a formula to determine the number of customers you have. Your basis for the number of customers you’ll begin next year with should be your current number of customers x your retention rate = your number of primary renewal customers.

This is a good opportunity to understand why you’ve lost customers. What themes can you identify with the cancels? Is it a certain technician, a significant number of callbacks, poorly communicated expectations, or something else? Diving into why you lost customers can help you identify a strategy to potentially save these customers and rework your strategy for the next year.

Second, how do you want to grow in the next 12 months? Do you have a “full” truck of revenue — that is, is there enough work for one technician to do in a day, every day, to complete a round of services before it’s time for the next? Work on filling one truck strategically, then the second, and so forth.
How many quarterly service customers can you reasonably bring on in one selling season? In addition, which renewal add-on services do you offer, or should consider offering?

With all these questions answered, you now have the basis for a plan and vision for what next year can bring.

2. Build your marketing plan

Many aspects of marketing are often overlooked as companies begin their operations. The most common is understanding how to develop a branding strategy for your business and truly stand out from your competition.

Your differentiation is the reason a customer buys from you in the first place. This needs to be understood and implemented every day, all the time, by every member of your team. That’s how your build brand equity. While there’s much more to think through than this column will allow, at a basic level, what’s the one thing your company does better than anyone else?

Next, identify your three main competitors. How do they market themselves? Who are their ideal customers? What do their websites, social media posts, brochures and vehicles say? What are their reputations like?

Compare their messages to your company’s messages. Do they all look the same? Do they all use the same superlatives? What can you do to differentiate your company, so you stand out from these three competitors?

While branding strategy is long-term, other aspects of marketing are more short-term. For example, based upon your business plan, how will you add new customers? What tactics will you use? Based upon marketing tactics, what is the typical close rate for generated leads? Now you’re building a plan to grow your business and understand what’s needed to reach your goals.

3. Build your operational and sales plans

How much revenue can one technician make in a day? Figure in route density, technician efficiency and fatigue, and plan for unanticipated reasons why a route will not get done — such as a sick technician, weather, or equipment breakdown. The more realistic your plans are, the less you’ll have to rework them throughout the year. Based on your numbers, when do you need to begin planning to hire another technician, either full-time or part-time?

Your sales plan will determine how many sales you’ll generate from your leads. Are you tracking your lead sources and closed sales? This can help you determine the best return on investment (ROI) for your marketing dollars. Your sales plan also should track your renewable add-on services, to give you a complete picture of your revenue.

4. Put it all together

While these are a lot of questions to answer, the fact that you’ve spent time thinking through these key areas of your business means you’re already on your way to standing out from the crowd. Keep in mind, once you write your plans, do not store them away and pull them out a year later. The purpose of planning is to provide a roadmap to guide your day-to-day operations. Should something unplanned happen — and it will — update your plan and adjust your resources accordingly.

Planning takes a considerable amount of time. But as you’ll see, it’s worthwhile. If you consider the alternative of constantly running to put out the next fire, you now understand the value of working on your business instead of in your business.