What to Look for in a Pest Control Exit Planning Firm

It’s no secret that interest in mergers and acquisitions in the pest management industry persists. At PCO M&A Specialists, we completed a record number of deals in 2021, totaling more than $250 million of enterprise value.

With baby boomers (who are approaching retirement age) at the helm of many successful pest control firms, plus the potential for an unfavorable policy environment on the horizon, we expect the uptick in M&A activity to continue for the foreseeable future.

With all of that said, selling a pest control company is a big decision — and it’s a move that most owners will only make once, so it’s important to get it right.

While many pest control operators (PCOs) know they don’t want to sell their businesses without representation, they don’t always know what to look for in a M&A adviser.

Here, we break down what you need to know to choose an exit planning firm that will ensure you walk away with maximum value. After all, it’s not necessarily the highest price that yields the most money.

4 Questions to Ask When Choosing a Pest Control M&A Adviser

Does the firm have a team dedicated to the pest control market?

Having dedicated staff that works day in and day out with pest control companies on areas such as taxes, debt structuring and operational issues is paramount to being able to advise a PCO on one of the most important decisions of his or her life. Having pest industry experts also assures the buyer that the seller is serious about the transaction and will be able to efficiently and effectively provide the information they need to get the deal done.

Does the firm have staff with MBAs or staff analysts who can model indicators of value?

A quality exit planning firm must be able to provide their client with an indicator of value using real data from operations, assumed costs of capital and potential purchaser hurdle rates in order to set the seller’s expectations of what a deal may be worth.

Does the firm have staff experts in PestPac, ServSuite, Real Green and PestRoutes software?

To feed the valuation model realistic data points, an exit planning firm must be able to access and mine the customer data contained in the seller’s software program. An M&A adviser or business broker who can’t use these programs, and instead requires the seller to complete questionnaires or spreadsheets to garner the data, opens their client up to errors or the potential to miss pieces of vital information buried in the database. Not to mention, working with an M&A team that takes this responsibility off your plate saves you the time and hassle of digging through data.

Does the firm handle the due diligence process?

Many pest control M&A deals die before they ever have a chance because due diligence turns up issues that become deal breakers. A quality exit planning firm will ensure a representative with expertise in your business is prepared to answer tough questions and hold your hand through the due diligence phase,

Your Guide to Pest Control Mergers and Acquisitions

The questions above are just a start. If you’re thinking about potentially exiting your pest management company, and you’re interested in how to maximize your after-tax value upon sale, read our “PCO M&A Specialists Pest Industry Merger & Acquisition Guide” or contact us today.

Our team includes CPAs, a former PCO and a seasoned industry M&A specialist who will help maximize the value of your company and guide you through a successful deal.

Our experts will not only help you develop the exit plan, we’ll assist you every step of the way, including but not limited to:
• Determining if the time is right for you to sell;
• Determining an appropriate asking price for your business;
• Presenting your business confidentially to potential buyers; and
• Managing buyer offers, due diligence, as well as the closing process.



Author: Dan Gordon

Leave a Reply