The fact that the top four companies on the PCT Top 100 List also are among the top five pest control servicing companies globally should come as no surprise. The North American market (United States, Canada and Mexico) accounts for around 60 percent of the global servicing market. These top four are Rollins/Orkin, ServiceMaster/Terminix, Rentokil and Ecolab, with Anticimex, also a global player, not far behind in the 8th spot.
Estimates vary, but at service company level, the considered view is the global market is worth around $20 billion and was expected, pre-COVID-19, to reach $26.3 billion by 2025 (source: Research & Markets: September 2019). Although pest control remains notoriously recession proof, what impact the COVID-19 pandemic will have remains to be seen. Some companies, such as Rentokil, have terminated all mergers and acquisitions. Others, like ServiceMaster, have slowed activity. Hopefully, this is only temporary.
With the North American market accounting for almost 60 percent of the global total, this leaves less than half for the rest of the world. (See graphic on page 36.) Europe accounts for around 19 percent, Asia 14 percent, the Pacific region 4.5 percent and the rest of the world 4.5 percent. China and other parts of Southeast Asia are the new rapidly growing markets. That’s because the income, the aspirations and the unwillingness of the burgeoning urban middle classes to put up with pests here has significantly expanded the market. In addition, the international food industry has increased demand as it strives to meet global standards.
This rise by Rentokil to third place in the U.S. has occurred over the last 20 years. The company’s first major move was in 2006 when it acquired Pennsylvania-based J.C. Ehrlich. This was followed by a raft of additional purchases, the most notable of which was the purchase in 2015 of The Steritech Group, followed in 2019 by Florida Pest Control & Chemical, itself ranked #16 in the 2019 PCT Top 100.
Within Rentokil’s European home base, it traditionally either has been the market leader, or not far behind. In 1964, the company turned its eyes towards the growing and potentially lucrative Far East. A series of acquisitions followed, notably in Hong Kong, Singapore, Malaysia, Brunei and China. In March 2017, the company announced a joint venture with PCI of India to create the largest pest control company in India. Since 2015, Rentokil has acquired 44 pest control operations globally.
#1 IN THE US. Holding pole position in the PCT Top 100 listing is Rollins. Worldwide Rollins, known primarily by its Orkin brand, comes a close second to Rentokil in terms of revenue derived from pest control-servicing activities. However, unlike Rentokil, the total revenue according to the Rollins 2019 annual report at $2,015 million comes totally from pest control, with nearly all of it coming from activities undertaken within North America.
However, since the turn of the century, Rollins has turned its attention to expanding internationally. The firm established its first international franchise in 2000 and by 2020 the number of international franchises had risen to 103, yet this accounts for less than 1 percent of total revenue. Today the company’s franchise expansion strategy is focused on Europe and Asia.
In addition, significant company acquisitions have been made, notably in Australia (Allpest and Statewide in 2014 and Scientific Pest Management and Murray in 2016) and Aardwolf in Singapore, also in 2016. Today Orkin serves customers in 68 countries, which together account for some 9 percent of total corporate revenue.
TERMINIX IN EUROPE. The #2 spot on the PCT Top 100 is occupied by Terminix, which just like Rollins, has had a traditionally powerful base in the U.S. but not yet internationally. According to the company’s 2018 annual report, just 3 percent of revenue comes from outside the U.S. However, since 2017 plans have been afoot to expand its global presence. Two significant acquisitions were completed in 2019 —Nomor Holding AB, the Stockholm-based pest control company, followed, in the UK, by the national accounts sector of what was Mitie Pest Control Ltd from Rentokil. With these acquisitions it is estimated that Terminix is now the fourth-largest servicing company in Europe.
ECOLAB: A BIT OF A MYSTERY? Completing the PCT top 4 is Ecolab. For this massive company, which describes itself as “the global leader in water, hygiene and energy technologies and services,” pest control is very much a minor support activity. Due to the way in which Ecolab records its figures, the Pest Elimination sector is jointly presented in the annual report with the Colloidal Technologies Group. This combined group accounts for only 6 percent of total company revenue at $907 million. In the unlikely situation that all of this revenue was produced by the Pest Elimination section, this would give Ecolab a 4.5 percent global market share.
A FORCE TO BE RECKONED WITH. The activities of Anticimex should not be overlooked. From its 2018 annual report, Anticimex also estimated that it held a 4 percent global market share, but this is likely to have increased. The private equity owned-firm’s stated vision is to be the global leader in preventive pest control.
Founded in Sweden in 1934, the company took its first steps on the road to becoming an international player with the launch in 1973 of Anticimex in Norway. Expanded operations followed in 2016 in Asia plus entry into North America with the acquisition of Bug Doctor the same year. Other significant acquisitions have followed to the point where the company has this year risen four places on the Top 100 to hold #8 position.
Readers could be forgiven for not recognizing the company’s name in North America. The Anticimex business model is unique, built on a decentralized structure, based on strong and entrepreneurial branches with a high degree of both responsibility and accountability. Companies that have been bought continue operating under their original names. In 2018, Anticimex acquired a total of 47 businesses in 13 different markets, bringing its total to 160 branches in 18 countries.
As for the future, CEO and President Jarl Dahlfors said, “We continue to grow both in U.S. as well as globally and achieved a 22 percent revenue growth in 2019. We see the future in preventative pest control where we are the global #1 with 150,000 digitally connected traps currently installed in 18 countries.”
DON’T FORGET TN. Claiming the #11 spot in the Top 100, the Truly Nolen mouse car can be spotted across the globe. Managed through Truly Nolen International, the company has franchised and owned businesses in 66 countries outside of North America, generating $80 million sales. This entitles them to claim just over 1 percent of the global servicing market outside the U.S. As CEO of Truly Nolen International, Jose Lutz, explains, “We have a very aggressive worldwide plan. We are planning to expand our presence as much as possible in the coming years through franchising, acquisitions and internal growth.”