Proactive Policy Pays Off

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Editor’s Note: Plunkett’s Pest Control used to respond to a bed bug sighting by inspecting the reporting unit and all surrounding units. But that process could allow unreported bed bug units to build in severity until the infestation had spread around the building. Now, for clients with any bed bug experience or concerns, Plunkett’s coordinates with management for 100 percent, unit-by-unit inspections on a quarterly basis plus move-in/move-out inspections. This serves to prevent building-wide problems.

The surge in construction of multi-unit housing as a result of changes in the economy and generational differences in housing preferences provides business opportunities for PMPs able to implement full-building, proactive bed bug inspection programs.

“Bed bugs are an epidemic,” said Jeremiah Riopel, regional operations manager at Plunkett’s Pest Control, Fridley, Minn. “It can also be a large revenue stream with the boom in multi-unit housing by changing reactionary treatment to proactive services.”

HOUSING TRENDS. Changing generational preferences and the economy fueled the multi-unit housing building boom, which continues today. There were a number of contributing trends: a weak single-family home market; the lowest vacancy rate since 2005; lower labor costs; easier financing for builders and developers; employment growth; and demographic trends. The results shifted an owner-dominated market to a renter-dominated market, as demonstrated by a 20-25 percent increase in rental households.

“Boomers are staying home and it’s contributing to the increase in multi-unit housing,” explained Riopel. “Boomers lost value in their homes and they’re not able to sell them for what they’d like. So, they’re staying in their homes longer.” Millennials are would-be first time homeowners, but don’t have access to those houses because they’re not on the market. “Boomers have put a plug in the system,” he said.

Millennials also have different housing preferences and are leading the housing market change. Although 20 percent of this generation are still living at home and another 30 percent own homes, the remaining 50 percent presently rent, mostly as a lifestyle choice.

“New households in multi-family buildings are increasing significantly,” according to Riopel. Boomers are staying home since the housing bubble burst in 2008. Gen X and millennials are being pushed, willingly or not, into the multi-housing market and renting longer.

“Folks are actually demanding multi-unit housing. It’s supported by the national trends. Developers are building more high-end, multi-unit housing,” explained Riopel. These facilities offer in-demand, lifestyle amenities not found in single-family homes, including night-club-style community rooms, yoga studios, and pet washing stations, among others. “This shift in housing trends support pest control companies adding full-building, proactive inspections to their services,” said Riopel.

“If you don’t have a plan for proactive multi-housing bed bug inspections, you should really think about getting into it,” suggested Riopel. “It’s a very viable market. The current trend of high-end rentals is projected to continue for five to 10 years. Then experts expect to see the senior-housing market explode. High-end nursing homes and progressive-care facilities will become more popular.”

PROACTIVE INSPECTIONS. “Our goal is to deliver results and retain our clients,” explained Riopel. Shifting to a proactive approach to bed bug treatments wasn’t a business strategy, it was a matter of customer service. “We listened to our clients’ concerns and designed a solution that delivered what they were looking for,” he said.

“Our philosophy is to listen to our clients, provide what they’re looking for, then sell that service to new clients,” added Stacy O’Reilly, president of Plunkett’s Pest Control. “Our multi-housing team worked closely with our clients to design a profitable, client-centric program, which helps us retain long-term clients,” she said.

“Providing clients with proactive, full-building bed bug inspections helps them keep costs down and their annual budgets more predictable,” said O’Reilly. This comprehensive inspection and treatment service has demonstrated that it’s possible to maintain lower costs by identifying unreported units, thereby preventing bed bugs from spreading. They’re currently servicing about 50 clients.

“We offer two programs. One is a conventional program offering preventive services, such as exterior bait stations, common area services, and exterior treatments. We’re invoicing traditional fees for the services, but it doesn’t allow the property to budget,” said Riopel. “The other option for the higher-end properties is what we call an ‘umbrella’ or ‘all-inclusive’ program, where we simply invoice, let’s say $2,000 annually for the property — $1,200 is set aside to provide preventive services and we have a call-back fund built in so the facilities can budget better.”

With a preventive program, “the plan is to drastically reduce client treatment costs, implement inspections, which is obviously a cost, but still come in less than what they were previously averaging in annual treatment costs,” said Riopel.

“We’ve found that this just flat-out works no matter what type of facility. The frequency of getting in to inspect units is going to save you time and headaches. It will also save your clients’ time and headaches. The program ultimately provides better living conditions for the residents,” he said.

“There’s nothing very complicated about preventive inspections, other than getting the right inspection frequency to deliver results,” added Riopel.

“Ultimately we were able to implement preventive inspections at a few sites and got some great results. We tweaked the program and now offer the service to dozens of sites. Ultimately, the goal is the save the clients’ money. At some of our sites, we’ve saved clients $50,000 annually.”

Perpetual bed bug infestations were also “technician killers” prior to a proactive approach. “We were just chasing our tails before,” said Riopel. “The techs at these sites were chasing their tails and became just as frustrated as clients. So, it’s to our benefit for that reason as well.”

“In 2010, we were having a heck of a time getting rid of bed bugs at properties. We had clients who didn’t want to go into a proactive inspection program and ultimately they were spending tens of thousands of dollars for heat treatments,” explained Riopel. “We had to come up with a better option. In one 162-unit facility we heat treated 75 apartments in one year due to constant re-introduction throughout the property. We had a resident who had six family members in six different apartments, as well as discarded furniture being brought back into the facility. There was no type of preventive inspection whatsoever.”

PROACTIVE RATIONALE. Clients may be hesitant to commit to a proactive bed bug inspection program, because it’s a new way to address an old problem and it can be somewhat intrusive for tenants. Once a client agrees and sees the reductions in both infestations and cost, “you’ll have a client for quite a long time,” said Riopel. “We haven’t lost a site yet that has implemented this program.”

“It’s rare that once we explain this approach that we can’t convince them to make the change,” said Riopel. “Usually, when we’re proposing this to a current client, it’s as clear as day and it makes sense to them. They’ve had enough of the reactive approach and gladly welcome a more proactive approach.”

Convincing new clients may present more of a challenge. “It’s an approach they’re not accustomed to, so it may be harder to convince them to try something new,” explained Riopel. “However, depending on the level of infestation at the site they may be more than willing to try a new approach.” For really hesitant managers, Plunkett’s may offer the initial inspection free of charge and, based on the company’s findings, recommend regular inspections.

“We recognize that this reduces our revenue with these clients,” acknowledged O’Reilly. “The clients recognize it, too. These clients appreciate our commitment to the best service program for them and refer us emphatically and enthusiastically to new clients. So, we may not generate as much revenue at the original site, but we’re adding clients that not only need bed bug services, but other pest control services as well. In the end, doing the right thing by the client is always a good idea.”

“We average a 98 percent success rate at the first go-around with a heat treatment,” said Riopel. “At the same time, we’ve seen a significant revenue increase over the past seven years in all aspects of multi-housing revenue.”

If you decide this is a service you’d like to offer your clients, the advice is to start small to give your team an opportunity to learn the process. “Pest management companies may want to start out with a smaller account and take more of a ‘bite-size’ approach before selling a 500-unit high rise,” said Riopel.

TREATMENT STRATEGY. Inspections are done manually to assess living conditions and inspect for multiple pests, for which pesticides are applied. It’s also important for management to provide a list of previous material applications.

You have to gain the full support of management and buy-in from residents before implementing an inspection program and let them know what to expect. Multiple educational presentations, with translators present if necessary, provide an opportunity for the pest management company to provide information and answer tenant questions. Holding one-half to one-hour resident information sessions twice a year can provide “phenomenal” results. As one might expect, not all resident reactions are going to be positive. Some residents vehemently refuse to allow anyone to enter the unit. All tenant-related situations should be turned over to management.

Some property managers have residents sign-off, indicating that they received and understood the preparation notices. Some managers also fine tenants if their apartments aren’t prepared for inspection and treatment.

Entire facilities need to be fully inspected to be effective, including all units, common areas, laundry rooms, storage lockers, and vehicles, if high infestations dictate. During the initial inspection, about a dozen technicians descend on a facility and systematically document the areas and extent of an infestation. Riopel added that they “average about four hours to get through a 180-unit site with 14 technicians. The team performs these sweeps regularly, so we’re efficient when providing these services.”

This also provides a baseline for future inspections and measuring success. It’s important for the technicians to identify the problems, rather than relying on tenants reporting them to management. “We’ve found that non-reporting of pest issues by residents is a big issue,” added Riopel. “There’s always the stigma of having bed bugs and ‘being dirty,’ which may prevent someone from reporting an issue.”

During normal weekly or monthly service visits, Plunkett’s provides move-in and move-out inspections. Units of residents who have given their 60-day notice or recently moved in since the last scheduled visit are inspected for bed bugs, cockroaches, mice, and treated as needed. Inspecting units before residents move out helps prevent pests from being inadvertently spread to other areas of the building.

Riopel suggests renting wheelchairs and walkers as needed. In buildings that are highly infested it’s likely that residents will have bed bugs in both and the pests will immediately return after heat treatment. Another suggestion is to have management purchase and distribute movie passes so that while a resident’s unit is being treated they are less likely to go to a friend’s apartment or to a common area. “It’s not uncommon that residents have nowhere to go during the day, so the movie passes help,” said Riopel.

Vehicles are another consideration, for which Plunkett’s uses a mobile heat chamber, which looks like an inflatable bouncy house. “When someone is moving in, and have a known case of bed bugs from their previous residence, we empty the contents of their truck into our mobile heat chamber, as well as place a heater in the back of the truck. By the end of the day their belongings are bed bug free,” explained Riopel.

“Some clients have decided to purchase their own heat equipment and heat chambers,” said Riopel. Plunkett’s partners with their clients and provides chemical applications in conjunction with client-performed heat treatments.

An initial inspection dictates the frequency of future inspections. “We’ve found that quarterly inspections deliver the best results, but that doesn’t mean inspections will continue to be at that frequency. We may reduce inspections to twice or even once annually,” explained Riopel.

“Since implementing 90-day inspections at several facilities, we haven’t found a single unit adjacent to a source unit that’s been infested,” said Riopel. “The 90-day frequency seems to work the best. Although, someone moving in with a lot of bed bugs, whose belongings haven’t been treated, can throw a wrench into the system.” This is where the move-in inspection really delivers.

The author is a Florida-based freelancer.