Common seller tricks in pest control
Sellers will show the starting route count and skip the cancellation rate, or treat door-to-door sales as if they were sticky renewals.
- A route list that includes recently sold, barely serviced, or already-cancelled accounts.
- Termite or wildlife bonds with long remaining terms and thin reserves.
- Technicians who ‘own’ the customers and are not under a non-solicit, or who plan to leave.
- The owner as the only licensed applicator for a key service line.
- Chemical inventory that is expired, overstated, or not legal to use as described.
Which numbers to verify
The number that matters is recurring monthly or quarterly revenue, plus a real retention rate. Ask for starts, stops, and price increases by month. Reconcile deposits to route software, not just a P&L. One-time jobs (exclusions, wildlife, fumigations) should be separated so they are not capitalized as route income. Recast owner route days.
Licensing and key-person risk
Applicator and operator licenses are tightly regulated and usually personal. A company license may still require a qualifying operator. Confirm state and local rules, insurance, and whether you can legally run every service line on day one. Termite work often has its own filing and financial-responsibility rules.
Equipment and condition
Tanks, injectors, truck-mounted units, and in-house software are the tools of the route. Look at truck age, leaky tanks, and whether the routing software is licensed to the company. A ‘route’ with two-hour drive gaps is less valuable than a dense one; ride it before you believe the density claim.
Seasonality and the calendar
Many programs are annual or quarterly, which smooths cash, but sales and some treatments still bunch in spring and summer. Ask how many customers prepay, and whether those prepayments are a liability. A winter close is less risky here than in landscaping, unless the book is mostly one-time summer jobs.
Customer concentration
A few commercial accounts — apartment groups, food plants, or a property manager — can be a large share of profit. Residential routes are more granular but more dependent on the technician. If one apartment contract is a quarter of revenue, read the termination clause twice.
Questions to ask before you make an offer
- Please provide starts, cancellations, and recurring revenue by month for 24 months, exported from the route software.
- What is the current termite or bond liability, and is there a reserve?
- Who holds the operator and applicator licenses, and what must I have in place at close?
- Which technicians are assigned to which routes, and what retention or non-solicit agreements exist?
- May I ride a full day on the two densest routes and the two thinnest?
- What share of revenue is recurring service versus one-time jobs?
- Which commercial accounts are more than 10% of revenue, and can those contracts be assigned?
- How is prepaid service recorded, and what unused service will I owe at close?
- May I see chemical inventory, expiration dates, and any regulatory inspections?
- After an LOI, may I speak with your accountant and a senior technician?