InnovationPest Control | 5 min. reading time

Advantages and disadvantages of digitization

Written by: Daniel Schröer

SPOILER ALERT: THE ADVANTAGES OUTWEIGH THE DISADVANTAGES

Let us explain as it also involves financial aspects that may not be obvious at first.

The clear disadvantage of digitization is the high cost associated with it. It was also a high expense to build a car and thereby replace the carriage. Or to suddenly use a cell phone. Nor was it easy to integrate iPhones and other smartphones into everyday working life, or to introduce remote work or home offices. And the electromobilization of automobiles is not easy either.

The only question is: is there an alternative and how much sense does the change make?

The cost of digitization seems like a main downside you have to change a lot after all. In pest control, the move to digitalization means a gigantic rethink. In the past, people used to place poison-bait boxes everywhere. These boxes gave you (supposed) security and gave businesses the opportunity to make even more money. More boxes = more income and longer service hours = more income again.

If you want to convert your operation to digital products, there are costs associated with digitization:

higher equipment acquisition costs (CapEx)
Training and education of personnel
Communication with customers
Data protection, product safety

So how can I install expensive digital boxes or IoT / AI Cameras that cost me a lot of money up front and still profit from them? The expense behind this is certainly one of the disadvantages of digitalization.

ADVANTAGES OF DIGITALIZATION

In addition, the following advantages speak in favor of digitization:

Better service for the customer
More transparency, more data and knowledge about the condition of traps or otherwise
Faster knowledge transfer and thus better service

So let's keep in mind: In addition to all the benefits, digitization also has disadvantages. However, these are only short-term in nature and are challenges or making a change rather than disadvantages of digitization. This challenge makes companies stronger, future-proof and, above all, fit for what's coming.

What is frequently googled is "digitalization impact environment". And yes, digitalization has a huge impact on the environment as you can reduce your CO2 footprint tremendously through fewer trips to customers and fewer toxins. Moreover, it has an impact on jobs and digitalization (also a common Google search: "jobs digitalization"). Namely, the jobs go from service activities such as control of pest boxes towards the production of IoT devices as well as data management. And this brings us to the benefits of digitization for companies.

AN EXAMPLE FROM THE FIELD

Imagine a world where every pest box is monitored with an image every second. This way, 95% of the boxes in the world can be eliminated.

Why 95%?

An anonymous case study by one of the largest pest control customers in the world found that over 95% of boxes are not frequented by rodents like mice, which are the biggest problem. So the company removed 95% of the boxes and left 5% digital boxes. Unbelievable, right? But that wasn't it. The company also cut back from 30-52 visits p.a. to 3-8 visits p.a.

Can this work? 95% of the boxes removed and over 80-90% of the annual visits?

Yes! And it even resulted in pest issues going down by over 50% measured over 100 days as a result of this switch from analog to digital. An incredible success that encourages the company to continue digitizing.

So the benefits of digitization for business are obvious. Fewer boxes, less human service, taking away "perceived security", introducing IoT devices for 24-7 monitoring and thus better pest control - 100% digital.

The fear that pest controllers will not be able to detect infestations is unfounded. The customer has found that only 4% of sightings come from the Pest Controller, the rest, 96% from the digital IoT boxes or employees.

The way to make money from this is of course different. The service provider must move from being a service company / facility manager to a "service and SAAS" combo company.

SERVICE AND SAAS

What does that mean?

When the IoT boxes detect infestation, immediate action must be taken, harder and faster than before, and above all according to the IPM (integrated pest management) principle. Seal, sanitize, repell, set many traps and bring the infestation down significantly within a few days. This also costs more money once for the action, but lasts forever. So the business "earns" less for the service, but more from the IoT devices that are rented out as well as for the data they generate.

Let's say a supermarket pays 600€ p.a. to a Pest Control company. So now the company has to remove the 20 traps and replace them with 5-6 digital traps. In addition, reduce the 12 visits to 2-6. The price will remain at 600€ or even increase to 700€. Then, if infestation is detected, it must also be consistently combated / sealed etc. (IPM).

SUMMARY

Rethinking is not easy, but the advantages and disadvantages of digitalization in the working world are clear: it is proven to be more measurable. Especially after the investments in the first year, pest control companies usually "earn" more, as the equipment is paid off quite quickly. In addition, "on scale" with their technicians, they can now serve even more customers and operate more competitively in the market.

The customers and standards as well as the multinationals of the pest control industry have recognized it: The future is digital and according to the CEO of Anticimex "the next best thing to sliced bread". A discussion about costs and co. is feasible, but unnecessary, as costs will come down in the medium term. In addition, it is becoming increasingly difficult to find employees for service. This is handle-able for small family businesses but a big future problem for multinationals / corporations.

Few want to become pest controllers anymore according to a survey in the United States. Everything has become more uncomfortable because of Covid and Co. Wages are also rising with inflation and it threatens to become unprofitable. So the customers' urge for good digital solutions comes at the right time and will therefore be implemented all the more in the next 5-10 years.

We look forward to walking this path with you. It will be different, but it will come and it will be fun.