The top ten ways pests can affect your bottom line

An original blog by Dan Gaskin, Acclaim Environmental – 07989 422469.

The Top 10 ways pests can affect your Company’s bottom line.

1. Illness:

According to Gallup polls, 131 million days were lost due to sickness absences in the UK in

2013.

So what?

What does this have to do with pests in the building?

The public health industry often go on about all the terrible diseases that you could catch

from pests but more often than not, you don’t get these. That’s not to say it doesn’t happen

but the illnesses that are more commonly spread are non-lethal flu-like illnesses where your

staff have to have a few days off or stay at work feeling awful. Rodents are particularly good

at spreading these illnesses. Basically, if you think you might have mice and your team are

starting to become unwell and it becomes clear that ‘something is going round, you’ll be

losing money through all the hidden costs of lost capacity, hidden HR costs including return

to work interviews, cleaning costs and missed opportunities.


2. Damage to property:

This is a ‘biggy’ – according to a Guardian article, if you’re trying to sell your house and the

prospective buyers notice evidence of a rodent infestation, if they want to buy, they will

negotiate an average, a 9% reduction in asking price – equivalent to almost £22,000 off the

average asking price for a UK property!

We worked with a Nursing Home many years ago in Northampton that had squirrels in the

loft. Basically it was a case of too little too late. The cost of damage to plumbing, electrics,

roof timbers ran into tens of thousands of pounds. In the end, roof had to be replaced and

because their insurance didn’t cover pest activity, they had to call in administrators and

declare bankruptcy. A company turning over a 7 seven figure sum went to the wall because

they hadn’t installed measures costing a few hundred pounds when they first saw the

problem.

Oh, and I haven’t even mentioned the amount of fires rodents start every year on farms:

20%. 20% of what I hear you asking…well 20% of the 1700 farm buildings and 66000 areas of

grassland that are destroyed by fire every year.

That is 340 buildings per year. Average cost of a barn? Anyone? I guess it’s more than a

tenner? Anything for £5000 for a tiny ‘kit’ barn up to…well, way past £100,000 + insurance

costs, legal costs, productivity costs, stock costs and on and on.

3. Damage to stock:

200 rats are able to consume nearly 1,100kg of feed in a year. Ok, so I can hear you saying

that the price of wheat is only (at the time of typing) £120/ton. That’s not so bad is it, Dan?

Well, today wheat is grown on about 2,000,000 hectares with a value of about £1.2 billion.

There is a lot of real estate for then to go at. Alongside the threat they pose to feed stocks,

they also carry infectious diseases such as Leptospirosis (Weil’s disease) which is spread

through infected rat urine, and is a very serious health risk to those who work on the farm.

They can also carry disease from unit to unit, when searching for nesting sites and food

sources. The estimated cost to UK farmers from rodent damage is up to £25 million every

year. Margins can be extremely tight for farmers and a serious rodent infestation can be the

difference between break even or not. A Grain shipment only has to have the slightest sign

of rodent damage for it to be busted down from ‘for human consumption’ to ‘animal feed’

or simply rejected completely.

Haulage costs, lost opportunity costs, time costs, labour costs, wear and tear of machinery,

seed costs, cost of buying harvesters, tractors etc. A serious amount of filthy lucre.

4. Damage to Reputation:

The UK is quite straight-laced when it comes to pests being seen in business premises. In

Australia and the US, things can be a little more relaxed due to the climate but, in a nutshell,

a client seeing a pest in your UK premises can ruin your business overnight…or at least as


fast as it takes to get round social media these days. Occasionally the local media will report

on food business that have, shall we say, not exactly made pest control a priority. So,

thousands of paper reports go into circulation as well as an electronic presence appearing

about your business that can NEVER be erased. The fallout of loss of business can be

catastrophic. Most regional restaurants, hotels and other food businesses rely on the new

word of mouth that the internet provides and Trip Advisor and similar testimonial sites will

instantly pass the bad news around. How much business do you think you would lose if one

of your prospects or clients saw a rat in your premises? What if it was just one client that

you lost? How much do they spend every year? Take that number and multiply it by 25

(average client lifetime) and then multiply that by 100 (average number of people they

know).

I’m guessing that’s a large number? So is it worth risking a cockroach infestation? Or fleas?

5. Your top talent leaving.

I’ve seen companies who say they pride themselves on ‘looking after our staff’ lose their

apparently beloved employees because they just couldn’t bear being in the building any

longer. It mainly happens when there are fleas in a building but we did once see it in offices

on a farm.

Bluntly, your top employees are your money earners and they know it. They also know that

their skills are equally useful to the competition and if you can’t be bothered to keep pests

out of the building, they’ll go somewhere else. A friend of mine who works as a sales trainer

says that the cost of hiring the wrong person can make or break an organisation if they turn

out to be a ‘wrong hire’.

A report carried out by Oxford Economics reveals that replacing members of staff incurs

significant costs for employers: £30,614 per employee on average. This includes opportunity

costs, training costs, time costs etc., etc. Also, you sales staff are those who bring the money

in. If your top performer left tomorrow, what potential deals has he/she just taken to your

competition…because they got bitten by a flea? £1000? £10,000? £100,000? £1 million?

6. Losing Industry Accreditations

You may or may not know that BRC Accreditation is all but mandatory if you want to be

considered a serious player in the food industry or its related supply chain. I once had a

facilities manager say they needed to put some insect monitors put in. Nothing so very

strange about that. In fact, that is fairly common. They’re relatively cheap for this £1.3 billion

company. I started to ask what would happen if we didn’t put in the 80p monitors.

Client: Well, we could lose our accreditation with BRC!

Me: Meaning?

Client: Meaning, Dan, that we’d lose our contracts with (insert 3 very famous food brands) !


Me: Which would cost?

Client: About £5 million a year in addition to redundancy packages to half our staff at this

plant. Oh, and the dormant multi-£million machinery of course and etc., etc.

Accreditations can make or break a business and if auditors see pests in your company, they

can and will remove your accreditation to protect the ‘end users’ in the supply chain.

7. Trying to solve it yourself.

The average spend is £500 with wasted time, financial outlay and further pest damage

incurred during the time that you’re trying to fix the problem yourself. You are also, I’m

guessing, not a pest control expert. You may run a successful IT company, manufacturing

business or nursery, but I’m willing to guess you don’t have your RSPH Level 2 in Pest

Control? The time you’ve spent (note that word) trying to fix your problem would surely

have been better spent focusing on your own business. You may have missed a crucial deal

or opportunity while you were trying to kill bedbugs, booklice or squirrels. It’s also rare for

over-the-counter treatments to completely cure your problem. And there you were thinking

that you were saving money.

8. Potential legal action against your business.

How much would it cost you to close your food business or food supply chain business for

one day? I don’t mean for a weekend. I mean in the middle of the week – because a

Chartered Institute of Environmental Health Officer (EHO) has served a closure notice on

your business. I’m guessing that figure is high or at least higher that you’d be happy to

accept.

What would happen if it escalates and your company either gets sued or taken to court for

infraction of relevant hygiene legislation? The fines may be relatively small for a first offence

but the fallout will be huge. There is compensation to be paid to anyone becoming ill. There

are legal costs in addition to the fine. Even if you settle out of court, you’re still going to have

to pay some money to settle. Then there are the ramifications set out in point 4 above.

However, we’re getting ahead of ourselves; it rarely gets to that level and the EHO will

normally just serve a 24 or 48 hour closure notice in order for you to get the problem sorted

out. So, how much would it cost you in lost business and those counter measures that you

still haven’t implemented?

9. Low morale and worry

‘I liked working here until the rat came in. Now I just panic all the time’ I sometimes hear this

sort of comment. If you worked somewhere where pests were in the building, how would

you feel? It’s a fact that we’re less productive when we’re stressed out or our morale is low.

We can’t focus, we hate our jobs at that moment and we turn out substandard work. It’s


estimated that the UK economy loses £29 billion per year due to low morale and dissatisfied

employees. If your team is working below par due to the presence of pest species, how

much more effective do you think they’d be if they had a clean, safe working environment?

How much more would they add to your bottom line? How much are you losing because

they’re unmotivated and skiving off? How much of that £29 billion are you missing out on.

10. Other contractors refusing to work with you

We get this a lot! Plumbers, electricians, builders, roofers, air conditioning engineers, telecoms

engineers, decorators…I’ve had then all be the reason why a prospect has called us to have

something removed. A person turns up on site and will refuse to carry out their work as the site

is either unclean (vermin) or unsafe (wasps, bees, hornets). To be honest, it’s hard to blame

them. Would you go into a space with an active wasp nest or a small areas that reeks of rodent

urine? No, and neither should they. The problem is though is that, if they’re a company with self-

respect, they’ll have charged you a callout. And still not done anything. They’ll then have to

charge you again if they come out. It can all start to add up if your property has pest problems.

If anything in this blog strikes a chord or if you’re worrying or unsure about what to do, why not

call us to discuss whether it makes sense to look at your problems. Call us on 0800 092 5259 or

07989 422469 or why not visit us at www.acclaimpest.co.uk. You can also email me at

[email protected]

http://www.acclaimpest.co.uk/

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The top ten ways pests can affect your bottom line