Mergers & acquisitions in pest control: The complete guide

How to build a pest control business acquirers want and exit on your terms.

For many pest control company owners, the endgame is clear: build a strong, reputable business, then sell it for a fair (or fantastic) price. 

If you’ve built a viable pest control business, it’s unlikely you’ll have a hard time finding a buyer. The pest control industry is exceptionally hot right now. As of 2024, the sector was valued at over $24B and current projections have the industry on track to hit a whopping $49.7B within a decade. 

That said, there are a few key ways you can increase your valuation and make yourself more attractive to a higher number of prospective buyers. 

We spoke with two experts who know this process inside and out: Nick Thome, CEO of Polaris Pest Group, and Wes Frye, VP of Mergers and Acquisitions at CERTUS Pest, to uncover what acquirers look for when evaluating a business, how to prepare your books and operations, and the small but crucial details that can boost your valuation. 

Below is a step-by-step guide. 

Step 1: Zero in on what buyers actually want

According to the buyers we talked to, acquirers aren’t looking too closely at your trucks, your equipment, your logo, or your tagline. 

“In pest control, you’re not buying equipment or hard assets. You’re really buying a customer base and a technician base of skilled people,” said Nick Thome, CEO of Polaris Pest Group. “You’re buying the predictability of established businesses.”

Predictability, in the form of steady, contract-based income that renews month after month, is what drives a company’s value. The more recurring work you have, the more confident a buyer can be in your revenue stream, and the more they’re willing to pay for it.

“Recurring services are just going to be more highly valued in the market than one-off jobs. A certain percentage of one-off jobs is ok. But we want to see as much recurring revenue as possible.” Nick explained. “It really just comes down to certainty of future revenue.” 

At most firms, that means at least 60 to 70 percent of your revenue should come from recurring contracts. Wes Frye, VP of Mergers and Acquisitions at CERTUS Pest, puts it even higher. 

“Ideally, 80 to 85 percent of the portfolio should be recurring,” he said. “The main value is in recurring revenue.” 

Again, that doesn’t mean there’s no room for one-off work. Termite treatments, exclusions, bird jobs, or other specialties can still make a company attractive. But unless those services are your clear niche, they won’t command the same multiple as a predictable book of loyal, contract customers.

Step 2: Tighten routes & move from monthly to quarterly service

Both Nick and Wes said tight routes and operational efficiency were two of the top attributes they look for when evaluating acquisition candidates. 

“Smaller geographic areas aren’t a bad thing,” said Nick. “If your techs are spending less time in front of the windshield, that’s huge. It shows efficiency, and acquirers don’t have to come in and fix it.”

That efficiency translates directly into value. When technicians spend more time servicing accounts and less time driving between them, profit margins rise. And so does your appeal to a buyer.

At CERTUS Pest, Wes takes this a step further. 

“We look at productivity per mile,” he says. “Not per hour. Per mile. In Vegas, where routes are tight, productivity per mile is through the roof. But if you’re in a spread-out area and your tech is driving 2,500 miles a month to do $16,000 in work, that’s too much windshield time.”

The same principle applies to service frequency. 

Many older operators still run monthly routes out of habit, but Wes says that model leaves money on the table. 

“The days of monthly pest control are over,” he said. “Quarterly service is more efficient, more profitable, and customers are happier. Your techs can do fewer stops per day, make more per stop, and spend more time delivering great service.”

The best-run companies heading into a sale have optimized these details. 

According to Wes, a stellar acquisition candidate for CERTUS looks like this:

• Dense routes
• Revenue-per-technician: $20,000 per tech per month. 
• Low 50’s to 60% gross margins and 20% EBITDA
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Pest control companies who hit numbers like these can typically expect a favorable valuation. 

“It’s also nice when your pricing sits in the normal band for the market,” Nick said. “If the average quarterly service is $100, you want most customers between $90 and $110. Too low hurts profitability. Too high risks churn.”

Step 3: Modernize your systems

For CERTUS, aging or outdated systems is a big red flag. 

“First and foremost is software,” Wes said. “You’ve got to have good software. And don’t go the cheap route.”

Software gives buyers visibility into customer retention, route efficiency, billing, and profitability. To CERTUS, it signals that owners are optimizing performance across the most important metrics and have an accurate, up-to-date picture of exactly how the business is doing. 

It’s a positive signal that typically correlates with a better-run business. 

“If you’re still using something 20 years old, it’s a problem,” said Wes. “I recently told one owner that just by upgrading to PestPac, his business would be more appealing, thus creating more value. Maybe even as much as 10 to 15% more.”

Here’s what our experts recommended: 

• A relatively modern CRM and routing software
• Accurate, clean customer records (no outdated or duplicate data)
• Digital billing and autopay adoption 
• KPI dashboards tracking technician-level metrics, including stops per day and revenue per technician 
• Up-to-date fleet and maintenance records
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Step 4: Maximize retention (for customers and technicians)

Customer and technician retention are everything. This point goes back to what Nick said acquirers are actually looking to buy, which boils down to:

• A certain set of customers
• A certain set of skilled technicians
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“Pretty much every acquirer I know will ask for raw invoice data and a customer identifier,” said Nick. “They’ll run retention analysis over three to five years to see how well you’re keeping customers.”

Retention tells the real story: are customers happy, and do they stick around? 

Because glowing reviews mean little if people churn after one or two visits. Acquirers want to see patterns of loyalty. 

At CERTUS, Wes starts doing due diligence before opening a single spreadsheet. He first asks a couple questions that can reveal a lot about how a company is run. 

“I’ll ask, ‘how long have your technicians been with you?’” he said. “If five of your seven techs were hired this year, something’s wrong.” 

Technician tenure signals stability, both in culture and in customer relationships.

“I’ll also ask about cancellation rate,” he said. “We like to see it below 2% per month.” 

A rate higher than that suggests cracks in service quality, communication, or pricing.

Wes also wants to understand where new business comes from. 

“Are they calling in? Do you have salespeople knocking on doors? Do you have digital marketing or referrals?” 

A diverse sales mix shows that the business isn’t dependent on one channel to grow.

Step 5: Invest in your reputation

When it comes to selling a pest control company, your numbers tell one story, but your reputation tells another. 

In addition to assessing profitability, buyers also spend time getting a sense of who you are in the market and what customers think of you. 

“A positive review base is nice to see,” said Nick. “It doesn’t have to be huge, but we want to see customers saying good things about your business.”

But reputation doesn’t stop with customers. It extends to your people, your processes, and even the way you show up as an owner. 

“Everybody’s business is a reflection of that owner,” said Wes. “If the owner’s sharp and put together, the business usually is too. If the owner’s disorganized, you’ll see it in their routes, their fleet, their team.”

Buyers like when your trucks match, your technicians stick around, and your operation runs smoothly without you. The companies that command the best offers are the ones that don’t depend on a single person to function. 

“We like to see operations that are so well-run, the owner could walk away and things would be okay,” said Wes. “If you’re the owner, and you’re the only one who knows what’s going on, that’s a problem.”

Step 6: Know what your ideal exit looks like

An acquisition makes sense for a lot of owners, but not everyone. Nick advises that owners deeply consider their ideal terms. 

“Think about what you want when you exit,” said Nick. “Not enough owners do that. Are you looking to be out in six months, or do you want to stay on for a few years? Be deliberate about that, because it affects how the deal is structured.”

There’s no right answer. But for Polaris, making a deal that both sides of the table are satisfied with is crucial. 

“Some owners want to cash out and be done,” he said. “Others want to stay involved or pass the company to a family member. The key is knowing what you want and engaging with potential buyers on those details as early in the process as possible”

Some deals involve full cash payouts. Others include earn-outs or rolled equity, where sellers keep partial ownership and benefit from future growth.

Neither is inherently better;  one may simply be better than the other depending on your goals and timeline.

And don’t be afraid to talk to multiple potential buyers. 

“Do your diligence on us, just like we’re doing on you,” said Nick. 

Pre-exit checklist

Ultimately, companies that keep clean, accessible data, including three years of retention history, clear accounting, low churn, and strong reviews don’t just impress acquirers. They make diligence easier, faster, and less risky. 

And in any acquisition, less risk means a higher valuation.

Here’s a recap of the metrics our experts said potential buyers get most excited about: 

Outside of the numbers, here are some general attributes that can pump up your valuation: 
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Operational:

• High route density
• Quarterly service frequency 
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Cultural:

• Low technician turnover
• Documented SOPs (business runs without you)
• Positive online reviews (4.0+ average)
• Stable leadership or GM ready for transition
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Strategic:

• Know your preferred exit type (cash sale, earn-out, equity roll)
• Know your market and territory value
• Be prepared to discuss customer retention and pricing logic
• Upgrade your software if outdated

Final word of advice: Your pest control business may be worth more than you think

Both Wes and Nick advised that many owners underestimate how much their business could be worth with just a few tweaks. 

“Some guys don’t know what they’re sitting on,” said Wes. “They’ve got money in the bank, and that’s enough for them. But if they tighten up their routes, get good software, and make their business run without them, they can sell for a lot more.”

It’s also worthwhile to spend a little extra time thinking about your ideal exit. 

“Know what you want out of your exit,” said Nick. “The more you think about that now, the better your outcome will be later.”

One simple way to optimize cost-efficiency and productivity down to the technician level is with Applause. 

Applause Scorecards gives owners and technicians a simple way to track, manage, and incentivize technician performance across 50 metrics. 

Chat with our team to learn how Scorecards can increase customer satisfaction, maximize technician retention, and accelerate business growth.