Does a pest control company’s customer cancellation pattern show a problem?

Request the cancellation list and sort it. By month, you can see whether losses rise after a price increase or a busy season. By technician, you can see whether one person’s customers leave more often. By service type, you can see whether the weak spot is residential, commercial or one-off visits.

Next, ask what the owner says is behind the pattern, and test it. If the answer is price, compare the cancellations to the rate changes. If the answer is service quality, compare them to callbacks and complaints. If customers moved or sold their homes, that is a different story from customers leaving for a competitor. Ask whether anyone calls to find out why.

Finally, compare cancellations to new sign-ups. A business that loses customers steadily and replaces them through hard selling is different from one with loyal customers. Your accountant can help you read the trend in the statements. Ask what the owner would change, and consider whether you could do it better. Be cautious with a single bad month. Look for the shape over time, and ask whether anything unusual, such as a storm or a competitor’s promotion, was going on then. Write down your questions before you meet the seller, then compare the replies with what the customers and technicians say separately.

Key takeaways

• Sort cancellations by month, technician and service type.
• Test the owner’s explanation against prices and callbacks.
• Compare losses with new sign-ups over the same period.