VOL. 133 | NO. 44 | Thursday, March 1, 2018
Kambs Tasked With Growing Commercial Arm of Terminix
Toni Lepeska, Special to The Daily News
ServiceMaster Global Holdings Inc. announced Tuesday, Feb. 27, that it will be purchasing one of the country’s largest commercial pest control operations and combining it with its Terminix brand.
The move to buy Copesan Services Inc., based in Wisconsin, is ServiceMaster’s latest in an ongoing effort to grow the commercial arm of its pest and termite control business, Terminix.
ServiceMaster’s new CEO compared the commercial division’s treatment in the past to that of a stepchild, though he prefers not to use that label. Nik Varty was named ServiceMaster’s chief executive last summer. He immediately proclaimed his first priority would to be to fix Terminix. He talked about better training of technicians and getting the right people in leadership positions.
One of those leadership positions was filled recently by Kelly Kambs, a Chicago native and an accomplished executive known for strategic results. On Tuesday, Varty elaborated on his expectations for Kambs as the first president of Terminix’s now-separate commercial division.
“Recruiting the right leader was so important,” Varty said. “I’m so happy to bring someone of Kelly’s caliber on board. She will help us build a world-class commercial pest business.”
Before coming to Memphis, Kambs served as senior vice president at CPG Building Materials in Chicago, where she grew that business by developing new segments for national owners and architects. She is noted for improving sales efficiency by more than 15 percent while significantly improving profitability through pricing actions and market segmentation.
Prior to CPG, Kambs spent three years at Behr Processing Corp. as senior vice president of BehrPro. She successfully developed and implemented the strategy for the company’s professional coatings business. Prior to Behr, Kambs worked at a variety of companies in sales, operations and commercial leadership roles. She studied chemistry at the University of Illinois and holds an MBA from Pepperdine University. While new to the pest and termite control business, Varty said, she is not new to driving a successful business strategy.
Terminix is confident of its strength in residential services, Kambs said. Now the commercial segment will have own set of resources with the separation. Each different segment has its own strategy and compliance requirements within the industry. In commercial services, Terminix develops strong, ongoing customer relationships with companies that have a national footprint.
“Our people make the business,” she said. “We engage customers to better service them to meet their needs.”
Plans for growth of the commercial arm is expected to be part of the Terminix turnaround. ServiceMaster would not reveal how much of its business is commercial, however, the commercial aspect of pest control is a $3.08 billion industry, almost as much as the residential end at $3.49 billion, and the termite control industry is another $1.60 billion industry.
With 120 million homes in America, Varty said, his company has focused intensive work on going “beyond the warranty model … I think the commercial is much more likely to be a source for growth,” he said.
Varty made his remarks in a webcast Tuesday as ServiceMaster provided quarterly and annual financial results. The Terminix brand reported a 1 percent year-over-year revenue increase in the fourth quarter of 2017 as increases in core termite control and wildlife exclusion sales were offset by a decline in core pest control revenue. Impacting the figure was the expected decline in revenue associated with the acquisition of Alterra Pest Control. Adjusting out the Alterra influence, revenue would have grown 2 percent in the fourth quarter of 2017.
For the full year, Terminix reported a 1 percent year-over-year revenue increase. Hurricanes Harvey and Irma also impacted the figure due to temporary closure of some branches in the storm zone.
“Although there’s much more to do, we have seen significant improvement in the customer engagement and service,” said Tony DiLucente, ServiceMaster’s chief financial officer. “We are increasingly confident that we have taken the right steps on our continuing journey to transfer service quality, improve retention and growth, and position the business for long-term, sustainable growth.”
Copesan has commercial clients in the foodservice, grocery, warehousing, property management, transportation, lodging and hospitality, and health care industries. It has more than 350 service centers in the U.S., Canada, Mexico and the Caribbean.
And the sole business focus of Copesan is commercial, so its acquisition should provide a big boost to the Terminix business.