Carmen Reino on Growing a $120K Pest Control Purchase Into an Eight-Figure Company

00:00 Dan Leibrandt

Hey everyone and welcome back to Pest Control Legends. My name's Dan Leibrandt and I'm here with Carmen Reino. Carmen is the founder and president of Anchor Pest Control out of East Brunswick, New Jersey, a company he built from the ground up in 2005 that's now on pace to hit eight figures this year, servicing the entire tri-state area. Today we're talking about how Carmen grew through acquisitions, why he's gone all in on the commercial and property management side of Pest Control. And what it actually takes to scale a company to eight figures. Now without further ado, Carmen, welcome to the show.

00:33 Carmen Reino

Thanks for having me, Dan. Appreciate it.

00:35 Dan Leibrandt

Of course, So, talk to me, take me way back to when you first started in Pest Control. I know you started, or rather bought Anchor about 21 years ago. Were you in Pest Control before that, or what were you doing?

00:50 Carmen Reino

I was an IT guy. I used to work on Wall Street fixing Bloombergs and Reuters. So I worked for trading firms, Citibank, Bear Stearns. One of my good friends came to me with an opportunity. Said, my brother's friend's retiring. You want to buy his company with me? And I said, my friend's name? I won't mention it. I said, Mike. I know how you make your money. I don't want to be your partner because eventually, it's time to catch up to you. So long story short, I bought the purchase the company. The guy trained me for about 30 days, and he moved to North Carolina. And here we are coming to year 21.

01:25 Dan Leibrandt

Wow, so no pest control background. You bought it for about 120k. Mean talk to me about what that initial first year or so was like.

01:35 Carmen Reino

I mean, so I wasn't the handy one in my family. My brother and father could fix everything. I would avoid any type of stuff like that. So my mother, when I told her this, she's like, you don't like to do this stuff. You're going to kill bugs? And I said, well, temporarily. I'm going to build the company. But yeah, at first, I'm going to get out there and kill bugs. So probably for the first six months to a year, I did majority of the tech work myself before I hired my first guy. So that's kind of how it got going.

02:05 Dan Leibrandt

Hmm, interesting. I mean, most people don't like getting into pest control because it's not a sexy industry or maybe they think there's not much opportunity. I mean, you probably had other business opportunities. What made this stand out? Why did you end up buying this business versus pursuing other ventures?

02:22 Carmen Reino

I'm going to say timing. I tried other things in the past. I had an elevator company with my brother. Didn't really work out too well. So timing, opportunity, it was a steady income stream. I wasn't starting from zero. So when I left my job, I was doing well too. I am going to start from scratch. So this was kind of a way to give something a try.

02:43 Dan Leibrandt

Okay. And then how did you start getting things off the ground? Like how did you start really growing the business?

02:51 Carmen Reino

Networking so I knew a lot of people prior and I knew you know I had a couple friends that had plumbing companies HVAC companies that would watch what they were doing and I would be like I could I could do this, know through connections I'm like I could grow like this So just watching other people how they did it and feeling like, you know, I could probably duplicate what they're doing That's kind of how we started growing it a lot of it at the beginning was low bid housing authority work. So that's how I grew so fast. I learned the bid process. I went out and got this bed bug dog, which was kind of crazy at the time. Saw a dog go through one of my accounts. I'm like, what does this dog do? And they're like, find bed bugs. So I fly down to Florida two weeks later, and I pay $10,000 for a dog that sniffs bed bugs, which opened a ton of doors to start off.

03:40 Dan Leibrandt

Hmm, interesting. Tell me more about that and was it worth it?

03:44 Carmen Reino

Yeah, I mean, through the years we ended up having three dogs. So at the beginning, the business was great. COVID really killed the K-9 industry for us, meaning we did a lot of preventative maintenance. So back to our multifamily, we did a lot of multifamilies, apartments, senior buildings. So we'd come on quarterly or twice a year and just do preventive inspections after the bed bug boom to try and make sure these places didn't have huge problems. Obviously during COVID, we stopped entering these places. People realized, hey, I just went eight months, no inspections. I don't have a billion bed bugs. So a lot of the programs kind of just fizzled out. We still do a little bit of it, but. Like it was.

04:22 Dan Leibrandt

Okay, interesting. It hasn't really, since COVID, hasn't been a thing really. What about, you said you started learning a lot about the bid process and that was a big opportunity. Can you explain that?

04:36 Carmen Reino

Yeah, so we used to do public bids, housing authority. So I got my first housing authority through a friend, was where I grew up. Actually, my first employee quit working for me and went to work for them. So I lost a $30,000 a year account, and I lost my first employee to my original housing authority, which fast forward 15 years later, we got it back now. He doesn't work there anymore. So it just happened to how the world works. So yeah, I just learned basically the bidding process. Is it's an open public record. You can see what they bid, bid it at your price, and hope to win. What I learned fast was you kind of bid your way to the bottom. It doesn't become the most profitable stuff after a while. Once you start scaling your company, you have more expenses. So we had a transition out of that.

05:23 Dan Leibrandt

Gotcha. Okay, that makes sense. And yeah, you're mentioning commercial here and right before the call, we were talking about your split. You guys are, like I said, on track to do eight figures and you're at 65 % commercial. I think that's super impressive and I usually see people at like 80 or 90 % residential. So was that the case back then? Were you mostly commercial too?

05:46 Carmen Reino

So it was probably completely commercial, 99 % up until like three years ago, where I finally started listening to people and they were telling me how much more profitable residential was, which they're 100 % correct. Residential is much more profitable business. But for me, because I want to grow fast, I could add $100,000 a year account on commercial side pretty quickly, right? Smaller margin, but I could do it quickly. So that's kind of how I dwarfed into do a more commercial versus residential. And I don't want to hear Mrs. Smith's phone call on a Tuesday afternoon about an kitchen counter, especially when I was more involved in the day-to-day deal with it. So that's kind of why it went that way. But once you start learning like your numbers and you know listen to what people say because you'll hear stuff for years and doesn't really doesn't mean nothing to me. It doesn't matter. Everything's going great. Once I finally got it I'm like wow these people are right. Let's get everyone subscription based you know residential pest control. So that's been the focus. We still grow commercially but that's been the big focus over the last three years really pushing the residential.

06:47 Dan Leibrandt

Okay, cool. Yeah, I want to dive into that in a sec. First, want to ask you, so I would assume then you have a really good perspective, really unique perspective on the commercial space. What would you say are the best or your favorite commercial properties to service?

07:04 Carmen Reino

So we don't do any restaurants. We might have three restaurants of local people who I had no choice but to take, right? So I'm not a restaurant guy. Majority of our multifamily is apartments and condo associations. So around here, there's a of condo associations, homeowner associations, where basically the association pays for termite, take a mosquito, and some wildlife. On the multifamily, non-HOA stuff, basically, they pay for unit services. We'll do some place we do 100 units a day, some place you do 10. It just depends on the contract, whether it's market rate or if it's low income.

07:44 Dan Leibrandt

Okay, so you like mainly apartments, multifamily, or condos, anything else?

07:51 Carmen Reino

We do some office space. I love warehousing. If anyone could tell me how to get deeper into that, I would love it. Very hard to break into warehousing from what we're seeing. Pretty big sales team, and we just have never had any luck. We have a decent amount just from referrals, but warehousing to me is something that interests me.

08:10 Dan Leibrandt

Okay, cool. And now you said, past three years or so you've broken into residential. What have you been doing to get more into residential?

08:19 Carmen Reino

So I would spend a lot of money on Google, know, do whatever to spend a ton of money on Google ads Give it a shot And I would go back and forth where I was spending a ton of money and it looked like you know, is going great, right? You're you're growing at 25 30 percent but In residential, if you're selling it with a monthly program, I'm paying, let's say, $275 for a new customer. I'm collecting $150 at start, $50 a month. You've got to really pay attention to your money because you could run out of money. So true story. I'm on vacation with my family. The person who was handling my money calls me up. She's like, can I move some money from the one account to another? I'm like, why? She's like, we're almost out of money. I'm like, what? So obviously, we moved money over from one account to the next, but had to realize when you scale residentially and you're paying a lot of money for your customers and you're only collecting 50 bucks a month or 75 bucks a month it takes some time to recoup your money.

09:19 Dan Leibrandt

Mm-hmm. Yeah, okay that makes sense. Yeah, you're talking about the profitability between the two I mean, how exactly does it compare how much more profitable is residential?

09:30 Carmen Reino

So I would say commercially, a good margin for us is 15 to 20%. Best 25%. On residential, you can get 40 % all day long. We do tri-annual service. We go out three times a year. So it's a lot more profitable, as long as you're picking the right customer.

09:50 Dan Leibrandt

You guys are getting 40 % margin on residential at eight figures.

09:55 Carmen Reino

Yeah, if you think about it, right, so if we're getting $650, we're going at three services, it's almost $225 an hour. A service takes about a half hour. It's almost $400 an hour, if you really think about it, residentially speaking. And obviously, callbacks come into place, but the margin is just much better, residentially.

10:12 Dan Leibrandt

Wow, I mean, you guys, that is incredible. Usually I hear companies are sitting around 20 % total. So that is really impressive.

10:23 Carmen Reino

Thank you, I think. Yeah, Yeah, I mean, we don't do quarterly, we do tri-annual. I learned that from one of the biggest companies in our area. And I said, why do you guys only go three times a year? He's like, well, because you're in the winter, your cancellations are going to spike. You call someone in December, January to come out to do their service, they don't have any bugs. And he's like, on top of it, you get a third better margin because you're only going three times instead of four.

10:25 Dan Leibrandt

No, no, seriously. So is there any... Yeah, go ahead.

10:49 Dan Leibrandt

Do you guys see any problems doing that?

10:52 Carmen Reino

No, we've been doing it a while. A lot of companies in our area do it. Viking, which is the biggest company, probably on the East Coast. That's where I learned it from. Yeah.

11:03 Dan Leibrandt

And you guys are billing monthly?

11:05 Carmen Reino

We build monthly, You can get service in the winter, but we don't just automatically come out. We do service April through October.

11:14 Dan Leibrandt

Okay, that makes sense. Something else I wanted to ask you about Carmen, overall like the journey of your company, maybe the timeline, I guess. So you guys started about 21 years ago. What would you say maybe like the first breakthrough point in your business? Was there some key pivotal moment or breakthrough that you had?

11:37 Carmen Reino

Yeah, there's been a couple of where it kind of slowed for a little bit and then just goes over the bump. So we got to two million pretty quickly. And once we got to two million, you have to make some decisions, right? So at $2 million, an owner can make a ton of money. But if you want to go to the next level, you've got to start investing in high level people. So then the owner has to take a cut and invest more into the business. I've always been very much put everything back in. I live a nice life. I don't need more.

12:07 Carmen Reino

Investing more into the business. So I'd say at two million is a big decisive move on how you're gonna run your company. You're gonna make it a big business or you're gonna just stay at two million. I would say at five again. A lot of people change, right? So the people that were helping me run the company at two million are not the same people that are helping me run it at five, right? It's not, which is a hard thing, right? Because you have a lot of people who you like and you trust, but if you don't grow yourself as a person, as the business develops, the business just kind of passes you by, unfortunately. So some people were, you know, put into different seats, you know? Some people aren't with us anymore, but that's one of the hardest parts too. So I feel when you get to five, now you've got to really, what are you putting first, right? The business and the people, like, it gets hard. Because you could say a five million, right? And probably have all the nice people nowhere else. But when you need people to really think, you need more brains in a room, you might need different people.

13:09 Dan Leibrandt

Hmm. So what exactly does that look like? Is there like specific positions you have in mind to get to five?

13:15 Carmen Reino

Yeah, I mean, so for us. The hardest thing, still hard to service managers, right? So you put a service manager in place. A service manager can train a technician. A service manager can do QAs, right? What majority of service managers, and my experience struggle with is the people part. So once you need them to leading people, right, it becomes a struggle. So that is one of the hardest parts. I put a sales manager in place, about like four million. Had like two salespeople. I met a good sales manager through... EOS, were implementing, someone referred someone to me. Like, this guy's too good to let go, right? And we brought him on and he's now the vice president. He's done a ton of great things for us. I'm not very organized. I'm not like a organized person. He's very type A. So he kind of keeps me in line. I throw ideas at him and he runs with them. So I think finding your, your matching business, like who's going to help you do it. Right. Cause we were getting by, but it was organized chaos, right? Like everything was getting done, but we're doing systems where we're filing the rights. System so that was a big a big move for us.

14:19 Dan Leibrandt

Yeah, you mentioned right people in the right seats. I thought you were referring to EOS. You guys are using EOS. One thing I want to ask right away there is then do you have a personal implementer?

14:31 Carmen Reino

I don't have an outside person, My vice president is basically the implementer. I'm the visionary implementer, yeah.

14:39 Dan Leibrandt

Okay, cool. And then talk to me about the rest of EOS. Has that been working for you guys?

15:26 Carmen Reino

It worked well for us. I'll be honest, we're not on it 100 % right now, but for us, we're a change back to what helped is.

15:32 Carmen Reino

Getting rid of the gray, right? Back to my organized chaos, it would feel right, right? Everyone seems like they're doing their job. But we started putting numbers on every single position in the company. And that came from EOS. And that really changed a lot, right? So back to our growth, like we have, our reviews are insane. It's just ingrained in our culture, right? So when we interview you, I interview you, I talk to you about, you competitive? Do you like to win? Do you like my extra money, right? So I think between, we have four locations. I won't call them. Branches because they're not I have one fiscal office two small just Google locations We have probably close to 13,000 reviews like my guys get them every day like it's non-stop every day and that helps us Keep our lead cost down right because we get a ton of you know direct searches right so That's a big part of it and we incentivize for it the guys love it's kind of just part of our culture. When someone comes in, I say to the guys, you could make more money than someone's been here for five years just by doing the little thing. So everything has a number, like reviews, leads. We do a production bonus. We don't pay on production because in the East Coast, it's a little harder to do. So just getting those competitive people in place have helped a lot too.

16:49 Dan Leibrandt

Hmm. Yeah, I like that specific angle competitive people because they're they're always going to strive to do more and then also having incentive so they stay around and they can they can continue to grow it in your company, right?

17:02 Carmen Reino

Yeah, absolutely. So strive for excellence is one of our core values. It's like I used to hear core values, all this stuff, every show I went to, and you would laugh it off. Like, I just want someone to show up. Like, yeah, just come to work every day and, you know, be sober and not crash my car. I don't care about your core values. So, but once you start really getting into it, like it becomes game changing. That's, you know, one of the engines that drive us. So again, people start to change. Like a lot of our older technicians didn't like hearing every day, hey, how many reviews do you get? How many leads you get? They just want to do their job, right? And there's nothing wrong with that. But in our environment, it just doesn't work because you're going to be annoyed. Like we talk about it every day, all day long.

17:41 Dan Leibrandt

Mm, yeah, that seems like the right way to do it. I mean, I was astonished at 13,000 reviews. I think I actually do remember you posting something about reviews in our group, I mean, 13,000, talk to me about, I mean, you did already, but go into the specifics of how are you getting those reviews? How are you making sure that those are all coming in?

18:03 Carmen Reino

So we've tried all the programs, and they all work well. But what we realize works the best is standing in front of someone with a QR code. Scanning QR code goes right through my Google My Business. I'm not asking them for their email, their phone number, nothing personal, because I feel some people, when you ask them for that stuff, automatically think you're going to spam them with stuff. And we just ask, hey, can you write us a review? It helps me out. And a lot of people, if you just ask, they're going to say yes. But.

18:29 Carmen Reino

Don't leave it behind. Just be in their face and ask. And that's really what really has helped a lot. And for our guys, I have technicians that make between $1,000 $2,000 extra month based on reviews, leads, all the little things, right? So to me, it's opportunity for our guys to really make some extra money and change their lives. Like, I had guys that, oh, I'm going to use this for my car payment. Well, the car payment turned into his rent. And that makes me happy. You're giving people opportunity to earn. So yeah.

18:56 Dan Leibrandt

Mm, a thousand bucks a month. Now that is like serious money for your technicians.

19:02 Carmen Reino

Yeah, our payouts are pretty, little by little, my CFO said, he's like, are you watching these payoffs go up and up? I'm like, yeah, but it seems to be working, right? Like we're growing and we're staying profitable and it's motivating people to be there.

19:16 Dan Leibrandt

Yeah, no, but I'll tell you from the SEO perspective, it's totally worth it for rankings, for conversions, for brands, like all, I mean, you are right on the money. You're doing all the right stuff.

19:27 Carmen Reino

And that's one thing we changed. It used to be an argument, not an argument, but everything's performance. My operations people would be like, well, this is really a marketing expense. Why is it coming out of our budget? So we started moving all the extra stuff into marketing as part of a marketing spend. Because you're right, it's more of a marketing thing than operations.

19:47 Dan Leibrandt

Yeah, definitely. You, before the call, or actually, I think this is on the onboarding form of what you guys are projected to do. You guys are projected to add two to $3 million this year. I mean, how is that possible? And how are you adding so much per year?

20:05 Carmen Reino

This is hard to believe. So not last year, the year before, I spent tons of money on marketing. Ton of money, the one where I told you the story where I was moving money around to make payroll and do all the right stuff. So last year, we didn't spend almost nothing on marketing. I killed the budget, right? Hired a CFO. He's like, spend too much money. Stop it, right? So we still grew at 25 % last year. So this year, the way I math this, so now I'm gonna spend, I got a new marketing company, a lover, it's a CMO service, back to what you said before, they don't do everything. They just pick the right people for you. So they hire SEO people, they hire paid people, CTT, all that stuff, they pick their vendors for us. So now I'm all in on marketing again. So my thought process is if we could grow at 25 % without spending the money, imagine what we can do when we spend the money, right? And another core focus for us is retention, right? So I've heard this for years, like, you lose 2 % of your customers per month, which equals 24 % across a year, which I have a hard time swallowing and I still do. That's a true number, right? So we put a company goal in that if we could cut it by six, half a point a month, right? Everyone's going to get an extra bonus at end of the year. And just by doing little things, paying attention to retention. That'll help us keep growing. So how do I keep doing it? I don't know, a little bit of luck, trying things. We try a lot of stuff, we track everything, so I know basically what all my ROI is, on everything we spend, what we're getting back, what sales reps are closing, just staying aggressive.

21:45 Dan Leibrandt

Hmm. I mean, it's just so crazy. 25 % last year, no marketing spend basically. So.

21:54 Carmen Reino

Maybe about 2%, 2 and 1 percent, yeah.

21:57 Dan Leibrandt

So where are those customers coming from?

21:59 Carmen Reino

Reviews, man. It's got to be the reviews. It's got to be the reviews, right? And then something that we did this year is I did a rebrand also. Like this dog did my new logos. That's our original bedbug dog, Anchor, which Anchor was named after the company. So the dog came after.

22:01 Dan Leibrandt

Ha...

22:14 Dan Leibrandt

Mmm.

22:14 Carmen Reino

So we did a rebrand, right? Because branding and in our industry, Pest Control, I feel we do a poor job at branding. People don't realize how much a brand really works, right? So we rebranded, we're rewrapping almost all of our trucks, all new clothing. And in the short period of time, that's been going on for the last four or five months, it's crazy. Like people, I love your logo, I love your trucks. It sticks out. So that helps so much.

22:41 Dan Leibrandt

Yeah, I was gonna compliment you on it. I think it's great. And I didn't understand the correlation between Anchor and dog. But now that I know the backstory, which, know, Dan Antonelli talks about this a lot of like, you should really have a brand story. The fact that it ties back to Anchor the dog. I find that awesome. I think it's really well done.

23:00 Carmen Reino

I've learned ton from Dan through the years, and that's who I listen to. That's why I did this, if I'm being honest. I see him speak at different home conferences and stuff like that. And he's also a Jersey guy. And he'd just say, this works. They have numbers that prove that it works. So we'll see. So far, so good.

23:17 Dan Leibrandt

Hmm. So do you? Are you guys tracking that like revenue from branding or truck wraps?

23:25 Carmen Reino

So what we're tracking is, I don't know if you could, everyone's gonna say truck wraps. We're tracking is direct searches, Compared to last year or this year, how many people are directly searching for Anchor Pest Control, right? We also, I went a little crazy with billboards. I put up a ton of billboards. I figured if I'm gonna do a rebrand, I might as well let everyone know about it. So in our service area, we put up a ton of boards. So far, every Tuesday I have my call with our marketing company. The direct searches are really up. Which is great. And then we do a lot of little things, like this is something I learned at a trade show, not a trade show, but like a conference. I went to a roofing conference over the summer. Branded water bottles. So I ordered pallets of Anchor water bottles. And we donated them to all the local little leagues and all the local sports. So they're selling our water bottles. And now everyone's walking around. It was hockey over the winter, the hockey arena, with Anchor water bottles. So little things like that to push the brand and really push us forward is how I think we'll continue growing.

24:09 Dan Leibrandt

Mmm.

24:30 Dan Leibrandt

Hmm, that's awesome. Yeah, just getting in front of people as much as you can and now it's they're always in the back of your mind. You see all the big companies do this. Maybe it's Nike or Apple or whoever. You just you can't help but when you need pest control you call Anchor you need the new shoes you get Nike.

24:48 Carmen Reino

Yeah, I mean it works in HVAC and all the bigger trades, right? So it's definitely, it'll work in pest control.

24:55 Dan Leibrandt

Would you say, you know, maybe for smaller owners out there, should they wait on really, truly rebranding like you guys have or is there a right level?

25:05 Carmen Reino

I mean, in my opinion, do it from the beginning, right? Because then the brand's stronger. Like, you could start a company with a strong brand, right? Spend the money, you know, on the logo design, like the rebrand. The amount of money they charge you to make a logo on a truck wrap is kind of insane. I could tell you could, you know what I'm talking about? So if you do it from the beginning with a strong brand, I think it'll go a long way. Instead of doing it where I'm unwrapping 30 trucks and rewrapping 30 trucks, it's more expensive. So I would say do it from the beginning. That's probably my best advice on that.

25:40 Dan Leibrandt

Yeah, now Tommy Mello kind of infamously rebranded it like $30 million. And I know that was, I forget how much he said, but it might've been like a few hundred grand or so. Mean, that's just, that's painful.

25:51 Carmen Reino

Yeah, I'll tell you, it had to be way more than that because what they tried to take off a truck wrap, right, and then put one back up, it was eye opening. Yeah.

26:02 Dan Leibrandt

Yeah, dang. And no, you're totally right with doing it right from the start. Know, one of my buddies is about to start an HVAC company and I showed him Dan Antonelli and he kind of became obsessed too, like reading the book and listening to all the podcasts and stuff. And now he's starting his company with a really solid truck wrap. And now he doesn't have to go through this whole process of rebranding tons of trucks. I totally agree there.

26:26 Carmen Reino

Yeah, it definitely makes sense.

26:28 Dan Leibrandt

Yeah, cool. Let's see. Okay, so we talked about commercial and residential. How about for owners that maybe are looking to start you bought your first location doing about 120k. Would you recommend other owners buy or start from scratch?

26:50 Carmen Reino

Well, it's a way different market than what I bought. Like, when I bought, bought dollar for dollar, so I paid $120 for $120. Nowadays, I have purchased two companies, which both were disasters. I won't lie.

27:02 Dan Leibrandt

Haha...

27:03 Carmen Reino

You chase what you hear. Yeah, mean, if it's the right, for me, I was giving up a good job. So this was automatic good income. So if you get an opportunity to do it and the price is right, sure, why not? It'll get you there faster at the beginning. So I guess this depends on a situation. But now lot of people here are three for one. They're thinking they're getting the multiples on their revenue that a company that's doing $5 $10 million is going to get, which makes it harder because they're a little bit more unreasonable.

27:34 Dan Leibrandt

Mm-hmm, yeah, okay, that makes sense. You mentioned that your two acquisitions were disasters. So tell me about those, what went wrong?

27:45 Carmen Reino

I mean, everything, if I'm being honest. So here's what happens. So you hear all these multiple stories. If I'm at $5 million and I buy a company and I pay $2 for a dollar, in my model, it could be worth $4 for one. So I'm automatically making money.

27:46 Dan Leibrandt

Ha!

28:03 Carmen Reino

No, you're actually automatically bringing on lower paying clients that at a two-man operation is profitable. But in your company, you're actually not making any money because it's underpriced. So one company was a wildlife company. I did that for skill set. So what I've heard from all the podcasts, maybe if you don't have a skill set, buy it. So I bought a wildlife company because doing the HOAs, a lot of the work is termite and wildlife. So we lose a lot. On the wildlife because we didn't do it. So I purchased a wildlife company. They had three full-time employees. And under six months, they were all gone. Just not culture fits. Totally not ultra fits. And that was all one time work, majority of it, right? So that was a disaster. Then I bought another local guy who I met through the years very close to where our office is out of. Very nice guy. And I'm looking at his pricing and I'm like, ah, this doesn't really work for us. But you know what? If I buy it's worth X more on my model, right? Because everyone says this. And he talks about these people. Do it, do it, do it. And then you start running it. And we look at production value, right? And I'm like, oh, why are these two guys production terrible. Oh, because they're doing all the work from the acquisition. And then you start raising the prices on people who been paying the same price for 20 years dealing with two people, and you start losing the customers. So that's my opinion. I have a good friend, Jeff King, who's built a lot of his company based on acquisitions. And he does it much better than I did. My buddy, Jeremy, too. And I kind of followed their lead. I don't think it's going to happen again.

29:34 Dan Leibrandt

What's not gonna happen again? That's not gonna mess up?

29:38 Carmen Reino

Buy another company. I don't think I'll buy another company. Yeah.

29:42 Dan Leibrandt

Okay. Yeah, no, I guess it can go really one of two ways. It's either pretty good or really good or it really sucks. I've heard some nightmare stories on both ends, people selling and buying.

29:55 Dan Leibrandt

Yeah, gotcha. Something else I wanted to jump back to was KPIs. So you were mentioning, and I think people might overlook this, but I've seen this with a lot of the top owners that I talk to, like Jonas or Tommy Mello, guys like that, being really obsessed and adamant about the numbers. So talk to me about what numbers you're looking at and what are you tracking on a daily or weekly basis?

30:23 Carmen Reino

Yeah, I mean, so I have a company app that's made so I see basically how many reviews we got today, our average phone call length, our booking rate. Like something people don't pay attention to in Pest Control is booking rate, right? Like how many leads came in did we actually go out and give them a price? Or did we quarter over the phone, you know, instead of just letting them off the phone? Production per day, right? So each technician, what we expect from them, you know? I know what they have to go out per day for us to get what we're going for in profit, right? So if they're value isn't enough, that day is not the best day, right? We track average phone calls. We want our CSRs to be very efficient on the phone. So we track their call times. And now with AI, like the stuff that we can do with AI is insane. Like, we use it a lot. Like, what we use it for our sales reps is... We use a program called Siro, right? So Siro records the conversation in person. And then it'll tell you what you said wrong, how you could close better, how to overcome objections. It has evolved over last six months. For now, it has what's called timeout, right? Halftime. So in the middle of me talking to you at your house, Dan, I can go to my phone. And it'll tell me what your pain is, what words to use, and how to close you, right?

31:40 Dan Leibrandt

Mmm. Dang! Wow.

31:44 Carmen Reino

And that's been a game changer for our sales reps. We've been using that for about four months now with that new feature. Our closing rate's up 12%. And that's in the winter, which is hard for us to sell. There's so many tools out there that a lot of people in pest control don't want to look at, right? Because everyone, this works for me already. But that's why I went to other industries and other industry events to really learn other stuff. Because let's be honest, HVAC, roofing, plumbing, that's where a lot of money is. The mark caps all there. So the technology companies go there first, right? So yeah, it's a little rough at the beginning because it's not integrated with our CRM. But what it can do, the Siro thing is crazy. And there's other programs out there. Tommy Mello has his own, too. That he made recently that does similar stuff but the coaching part and then it'll call you in the middle of the day and say let's role play right you struggled with this and now you're role playing with an AI agent on your phone to get better at what you're doing so that's a huge part of what we track so we'll track how many role plays guys do a day obviously all the normal metrics that you would really track in a business but everyone from the only person who doesn't have a metric is my router right everyone else has clear metrics, they get clear bonuses based on making their numbers.

33:00 Dan Leibrandt

Awesome. I've actually never heard of that platform before. I've heard of Real Love, which that might be the one you're talking about with Tommy.

33:05 Carmen Reino

Yeah, Rilla's very, very close to that, So Rilla is very expensive. So if you look at Rilla, right, I did originally. Any conference that lets you go there for free in Vegas and put you up they're gonna charge you a ton of money, right? So the cost per user really in our industry isn't gonna work Siro is a lot more affordable. I would be paid around 200 bucks a month per user Really is lot more than that. So for us our average tickets compared to other industries We can't pay 1200 bucks a month per user just ain't gonna work So Siro's very similar does a lot of same things and it just keeps evolving.

33:47 Dan Leibrandt

How is that spelled? That with a C?

33:50 Carmen Reino

S I R O...

33:52 Dan Leibrandt

Okay, interesting. Siro. Okay, I'll have to check that out. I haven't heard of that before.

33:58 Carmen Reino

Yeah, it's pretty wild.

34:00 Dan Leibrandt

Okay, yeah. Okay, so we were talking about kind of the journey. You were saying that you had a breakthrough at 2 million and then again at 5 million. So what has been like, and I know we talked about this, but I want to go deeper on this. Like what was the difference between you at two versus at five and beyond? Because just a little bit more preface here. Before the call, we were saying that we see a lot of owners get stuck around the two to four range. So I guess more of the question is then, I mean, how do you break out of that two to four range and get to five plus?

34:37 Carmen Reino

I mean, this is my opinion. A lot of owners at $2 million are making a lot of money, making a hundred thousand dollars a year, right? In order to get the five, you have to invest and pay people six figures. Like, pay people high salaries. And a lot of people don't want to do it, right? Or they want to pay for marketing companies. They want to just, oh, I'm here at $2 million. I'm making $300,000, $400,000 a year. I don't want to give it up, right? From like two to five as an owner, as far as I'm concerned, I didn't make much more money, right? I didn't. I invested everything back into the business by hiring people to kind of take me out of the day to day and give them the control to do what they have to do to help us keep growing.

35:13 Dan Leibrandt

Yeah, I see that with a lot of owners too, especially early in the game. I think you really need to be willing to take a cut to the paycheck if the end goal is to sell, which I think that's the goal for most people.

35:26 Carmen Reino

Yeah, you gotta build it to sell it, right? That's they say.

35:29 Dan Leibrandt

Yeah, yeah. So is that the plan for you or what do you guys want to do with your company?

35:33 Carmen Reino

I mean, I've been building to sell it for like the last 10 to 15 years just because, again, I've learned from other people. I don't really have a plan. Like, we're just pens, you know. Got to watch the markets, got to watch what's going on around us. I love... The home service industry as a whole, right? I love pest control. So yeah, don't have a, eventually yes, I'll sell the company, 100 % I'm not giving it to my kids. It's not happening. I tell my 13 year old all the time, you're gonna have to get a job. It's not what's happening. But so that's my plan. Eventually, I'll sell it eventually. I don't know when, but I always say in our meetings, if we stop growing, like I used to always hear too, like if you grow double digits, you should be happy, right? Like 10 % happy. I say,...

36:01 Dan Leibrandt

Ha ha!

36:18 Carmen Reino

Said every company meeting, if we're growing by 10%, you guys should look for a green uniform or something different, because then I ain't gonna be happy. And then you're gonna work for someone else, and I'm gonna sell the company. So I kinda joke when I say that, but I kinda mean it. I enjoy the growth part. I enjoy that. Getting opportunities for our team, growing the company, learning different things with myself. So yeah, it's not gonna be a legacy business. I'm not giving it down to my kids. Eventually, I will sell it.

36:44 Dan Leibrandt

Yeah, no, I totally respect that. You've also mentioned going to industry events and being fairly involved in home services. So you mentioned that that Siro tool, is there anything else that's maybe stuck out going to conferences and talking to other high level people?

37:01 Carmen Reino

A lot of the things is the branding, right? We don't see in pest control, right? The Siro, the AI tool is amazing. We have similar tools now in our phone system that does very much coaching and feedback, but I think that's kind of standard with most voice-over systems. Yeah, I think it's just the branding thing, following a sales process. I'm really big on how much time someone spends in a home. We have outside sales reps and a lot of companies, like, we sell everything over the phone. We have a mixture. I have an inside sales team, and then I have outside sales reps. But when it comes to outside sales reps, they're selling at a much higher value. I had a guy last year sell over $1 million in pest control, which is kind of crazy if you really think about that. Like, residential pest control, he sold over $1 million. He's been with me since $1 million. We were $1 million. He came to work for me. Great guy. But he's just a hustler, right? But make sure you give him the right appointments. He's running them correctly. He follows the process. So that's a lot of it.

38:02 Dan Leibrandt

Hmm, that's incredible. One of your, was that inside sales or outside sales with a million in residential?

38:10 Carmen Reino

Millionaire Central. Well, let me say this. Very close. He was over a dollars. He does sell some HOAs, right, which are some homeowner associations, which could be some bigger dollar stuff. But it's not like he sold a half million dollar account. No, he sells consistently. He never turns it off. He's probably almost 65 years old. He's in better shape than anyone I know. He's just a machine. He's just a machine. Yeah.

38:31 Dan Leibrandt

How? Huh, so for the owners listening to this, how did they find that guy for them? Well, let's call him Joe. How did they find Joe who adds a million dollars in revenue?

38:44 Carmen Reino

Someone else fired him. That's it.

38:46 Dan Leibrandt

Ha!

38:46 Carmen Reino

Someone else fired him. And it came to me again, when we had no residential work, we were almost all commercial. And we came aboard and little by little we progressed. Like he could be probably the hardest person to manage at times, right? But always, you know, just working hard, you know. That's you know, how do you find them? I to me now it's more of coaching them, right? You get them get them aboard and keep them learning right? He'll adapt to this new stuff. He'd like I'm at the bike at the gym I was role-playing at the gym, you know Again back to me said before striving for excellence always trying to be a little bit better that just get that type of person that wants to improve...

39:25 Dan Leibrandt

Okay, yeah, so the I guess the super ambitious super hard-working type...

39:31 Carmen Reino

Yeah, mean, in a perfect world. Yeah, everyone's like that,...

39:35 Dan Leibrandt

Obviously it's not always that case or we're human yeah, so you mentioned you just brought up your your core value again, which is strive for excellence Do you have any other core values?

39:37 Carmen Reino

No, that's when I'm done.

39:47 Carmen Reino

Yeah, have Strive for Excellence. Always found the positive. I hate negativity, right? Like, I don't like negative people. Want around me. So Strive for Excellence. Now I'm going to forget him as we're going through it. Try for excellence. Always find the positive. Yeah, I should know the rest of them. It's terrible that I'm not remembering them. So yes, I should know them. It's terrible leadership right here.

40:00 Dan Leibrandt

Now you're all good.

40:14 Dan Leibrandt

No, all right, let's talk about positivity, because I totally agree with you.

40:17 Carmen Reino

Or reliable is another one reliable responsible now I'm playing through them in my head good back to your sign I'm reliable and responsible...

40:24 Dan Leibrandt

Wait, so what were the ones? I missed it. Okay, reliable and responsible. Yeah, I wanted to touch on positivity there. So, I don't know. I feel like a lot of people kind of believe this, but they don't really act on it. Why is positivity for you so important?

40:44 Carmen Reino

Because it just, I'm a firm believer in business and in life. Like if you always think about negative stuff, negative things are gonna follow you, right? If you always think about positive things, positive things are gonna follow you. And that's the kind of how I live my life. I don't want anything bothering me longer than five minutes, right? Obviously I don't forget it. But you can't dwell on negative because then you just get in a bad place and your energy becomes bad. And it just, I don't know, I just don't think it works.

41:07 Dan Leibrandt

Hmm. No, I totally agree. It seems obvious, but I feel like a lot of people don't act that way. They're, they're just, they're always angry. They're always upset. And like you said, then that attracts all these other bad things of it. Maybe you're an angry person. So now you just happen to hire angry employees and there's just like a spiral effect.

41:26 Carmen Reino

I definitely agree with that.

41:27 Dan Leibrandt

Yeah, 100%. Well, cool, Carmen, we'll start to wrap up the show here. I've got one final question that I like to ask all my guests and you can take it anywhere you want. And the question is, what is your message to the pest control owners out there? What do you want to tell them? What do you think they need to know?

41:44 Carmen Reino

One of the most frustrating things about pest control, and this is I say to some software company trying to, no one wants to change. It's worked this way for 30 years. It works this way. If you want to, especially now with AI evolution, if you really want to keep your business going, you got to adapt change and just got to run with it and try your best and you got to implement. Don't be afraid to make mistakes. I know a lot of people will come to tons of trade shows, right? And they're learning and learning. Like, what did you do? Oh, nothing. After I go to a trade show, my staff hates me because I'm coming up with 15 new things to do. So we do a little rehash. We had three programs doing the same exact thing, like a Hatch, cinch, and chur, right? They're all very similar. Because I went to trade shows, and I heard different ones. And one day I sat down, and they were like, these almost all do the same exact thing. I'm like, yeah, but one's better at this. So it could be bad, but it's also good because just willing to make a change it and do it quickly.

42:43 Dan Leibrandt

So be willing to change and be willing and able and going to implement.

42:50 Carmen Reino

Yeah, you gotta implement, man. If you don't implement, nothing's gonna happen.

42:54 Dan Leibrandt

Awesome. Real quick, I'd like to go through, if you're okay with it, the software tools that you use. So you said you use Siro, Cinch, what else do use?

43:02 Carmen Reino

We use Siro, we use Siro, we use Hatch. Hatch is a rehash program, right? So if we asked 90 % of Pest Control owners what rehash means, they wouldn't know what it means, right? It's something that I got from HVAC. Basically, it's automatic follow up to your customers, automatic follow up to your one time services, your loss leads, and it just automates the process. A text message, a follow up, you know, and the amount of rehash that we'll do, you go back two weeks, or you have various programs that just constantly hit the customers. And hit him over and over again. And it works, man. Like, you know, I say seven to 10 touches before you close someone. If you automate that process, you're closing more.

43:42 Dan Leibrandt

Yeah, definitely. And any other tools there that you guys are using?

43:46 Carmen Reino

So Hatch is tied into Angie's List, which everyone hates, which I love. It has an automatic AI agent that responds and talks to people. So those are the main ones. The Siro, Hatch and Cinch, Hatch and Cinch are very similar. One of them just works better with our CRM. Yeah, man, that's the main couple things that we really do well with.

44:10 Dan Leibrandt

Got it, awesome. And something pretty genius I've noticed is that you borrow from all the other home services. And I think that's totally the right approach. I don't know if I've heard anyone else mention that. Probably the main figures like Tommy Mello, because garage door is small. I mean, that should totally be what we're doing in this industry, because pest control is relatively small. It's less developed. So... If you can just borrow from what the top guys in HVAC or whatever are doing, I feel like you'll be way ahead.

44:41 Carmen Reino

And that's exactly what I've been doing. And I heard it from guys like Tommy Mello. Tommy Mello was on my buddy Joe's podcast years ago during COVID. And I'm like, this guy's pretty smart. And now it turns out he's probably the best name in home services. So I've been to his events, been to other guys' events. And yeah, just kind of take what they're doing outside of pest control and do our best to bring it in here. And it works.

45:03 Dan Leibrandt

Yeah, 100%. Well, cool, Carmen. This has been a great show. I really appreciate your time coming on. How can people connect with you and learn more about you and your company?

45:12 Carmen Reino

I'm on LinkedIn, Instagram, Facebook. I'm an open book. I love talking to anyone that needs any type of advice or anyone wants to give me advice. I'm always open to listen. No one's perfect, right? So that's really it. I'm always available.

45:26 Dan Leibrandt

Awesome. Cool. So Instagram, LinkedIn and Facebook, all those links will be in the description. Everyone go follow Carmen. He's a killer. I'm super impressed from this podcast and Carmen, just keep doing your thing. I can't wait to see where you take this.

45:40 Carmen Reino

Thanks man, I really appreciate having me on.

45:42 Dan Leibrandt

Course.