PODCAST TRANSCRIPT:

Ian Robertson
Broadcasting from the cabana in his backyard, we have Daniel Dunlap. How are you, Daniel?

Daniel Dunlap
Good, thanks, Ian, for having me. Appreciate it.

Ian Robertson
Yeah, and if you’re listening to the audio version of this, which is most of our listeners, Daniel’s just in a cabana-looking thing in his backyard, and it’s awesome.

Daniel Dunlap
I saw the name of the app, the Riverside something or other, and I’m like, oh, yeah, that makes sense. I’m sitting here, riverside.

Ian Robertson
Are you really perfect? Yeah. Man, so I’m jealous. I’m just in my office, and you’re riverside on a cabana, enjoying the day.

Daniel Dunlap
I was in my office, and I’m looking at the shelves behind me, and all the stuff, and I’m like, you know what, this is a mess. I’ll just sit out back.

Ian Robertson
Listen, if anybody is listening, and you’re a guest on our show, if you have a cabana riverside, I expect you to broadcast from there.

Daniel Dunlap
Sure, sure.

Ian Robertson
So, Daniel, getting to the point here, we’re really happy to have you on, because you’ve done something that I’ve encouraged home inspectors for years and years to do, and it’s sometimes even a sensitive subject among inspectors, but you have started a pest control business, so basically another service that doesn’t have anything to do with the direct SOP of a home inspection, but it’s adjacent to it, and it’s working out really well. But before we get into that, tell me a little bit about your companies, Four County, and yourself, and things like that.

Daniel Dunlap
Sure, so I mean, I think we’re almost to 10 years doing the home inspection company. Actually, I think you’ve been doing our website and everything the entire time, for the most part, but yeah, I mean, we’re busy with inspections, obviously. I have a second inspector. Had another inspector before that I lost to his full-time job, so that was kind of a bummer, but ended up training my brother-in-law, so he’s a licensed inspector now, and he also helps out with the pest control stuff, so that’s good. We’re doing, you know, I don’t know, I think we hit the 3000 inspection mark or something like that this year. So, yeah, I mean, we’re busy, you know. You and I kind of started talking about the whole pest control thing a while ago. I think I was probably one of the skeptical inspectors to begin with, but you know, we just kind of dug in and did the work, and you know, got the extra licensing and all the other, you know, business-adjacent stuff, and incorporated it into now our second website with you, and you know, so it’s working out really well. Seems like the pest control industry is, you know, I hadn’t done a whole lot of research on it, for digging into it, really, and I think our conversation was exit strategy kind of thing, reoccurring revenue, you know, etc. So we’ve pretty much got it incorporated into our day-to-day processes of the inspection company, which is nice, so we have obviously all the leads from our home inspections, and we did a lot of the wood destroying insect stuff before, so the inspections, we were doing some of the treatments as well, so it comes up pretty frequently, and surprisingly, a lot of the inspection clients want a quarterly pest control program and stuff like that. And we’re just barely this past year started it, you know, over the winter, essentially. So this is kind of our first spring, ramping it up, and kind of already have a dozen or more quarterly clients, so it’s off to a good start.

Ian Robertson
Yeah, and you said a lot of valuable information there in that small bite that you gave us, because one of the things that we have to think about, a lot of guys will be like, oh, I got into home inspections for retirement, that’s how it used to be back in the 90s and early 2000s. Now it’s younger guys like you, and I say younger, I don’t know how old you are, you look a bit younger.

Daniel Dunlap
I’m 30.

Ian Robertson
Okay, 30, yeah. So, yeah, you’re young, so it’s like, okay, if I ever wanted to exit, how would that look? Home inspection businesses have very, very little value, because we’re one-off clients. So, guy gets a home inspection from us. Now, we don’t have contract work. If the business owner passes away or can’t work, then the business typically, statistically dies off with his exit. So, recurring revenue, if anybody wants to write anything down from what Daniel said, recurring revenue, ARR (annual recurring revenue), MRR (monthly recurring revenue), and for pest, it’s gonna be quarterly. Because that’s what people are going to measure it by. Somebody wants to buy your business, what is your annual recurring revenue? And depending on the business, it’s 2x to 7x. So typically a pest control, from what I understand, is going to be 3x. So, if you’re doing $300,000 a year in recurring revenue, someone’s going to buy your company typically for 3x. So $900,000 That’s a good chunk of change for payout.

Daniel Dunlap
Yeah, for sure. And we’ve already had private equity people approach us and stuff like that, not just because of the pest control, but just in general, you know, and it’s not very flattering what they want to offer, but yeah, I mean, that was kind of the idea was, you know, how do I go from being an owner/operator to scaling everything up, incorporating more inspectors, having them double as our pest control technician, and we’re well on our way there. The biggest thing is the logistics, that’s kind of the pain point at the moment, but we’re working on that as well. I wish they made a system that would accept both pest control and inspection software, meaning the billing and the logistics, and all that stuff, so we’re working on that, trying to figure that out.

Ian Robertson
Yeah, and logistics of pest control business, a lot of times we think it’s pretty simple if we’re a home inspection company, because it’s like, oh, it’s just this and that. It’s way different for pest control, there’s way more little idiosyncrasies than you really plan for.

Daniel Dunlap
Yeah. Well, and now we have two separate business licenses for the pest control stuff, obviously, and we’ve never had any issues with the state or anything, but the second we applied for our second business license, they wanted to come audit our pesticide stuff and all that, which is totally fine, but yeah. I mean, the chemicals are kind of an interesting part of that, where we’re pretty particular about what we spray, where we spray it, how we spray it. We were just at a house recently, and they were having issues, and they wanted part of their lawn sprayed, and it was right beside a pond, and they had the pond fully stocked, and it’s just little stuff like that. It’s like, well, you get a technician out there that is a little careless and accidentally gets some overspray in their pond, and stuff like that, you know. So, there’s a little bit more to pay attention to, for sure.

Ian Robertson
Yeah, and so I do want to emphasize this too, as you’re speaking, and we mentioned it earlier, I think this is a sensitive subject, because home inspectors—I can picture the emails and the messages that I’m going to get after this podcast—Ian, our SOP in our state says that we can’t do work on a house for a year afterwards or unethical, blah blah blah blah blah, and I say blah blah blah blah blah because I have not found a state that says you can’t do this. In fact, I forgot who it was, a friend might have been…anyways, I forget, sent to New York State, and New York’s just like, yeah, pest control has nothing to do with anything that’s in the SOP for home inspections. The SOP says you cannot work on a house within a year of the inspection, but only related to stuff that was in the home inspection. You want to fix their dryer? Go for it. It has nothing to do with the structure or the roof for the plumbing, unless you’re doing the drain for the washer. Or you want to do mold? That’s another one. But my problem with mold and radon, I see guys will do that, they’d be like, oh, okay, cool. I do mold and radon after the inspection, like that’s still a one-off business, so it’s still great. But, like, I have a client that we do his radon website too, and we do his home inspection website, and at any given point in the year, he’ll be like, okay, I don’t know what to do, the radon’s died, and then two months later he’s like, oh, it’s back up again. It just depends on how many radon issues you found the two months before.

Daniel Dunlap
Right. Yeah, I just had to go recertify my radon, and this wonderful state of Ohio gives you zero reminders to relicense, and so if you’re a day late on your radon testing license, they’re like, “Sorry, you just got to redo everything.” But the radon stuff is just so heavily regulated, and the Department of Health is, I mean, it is what it is, but yeah, we never got into the mitigation. We do the testing for it, and there’s a couple local companies that we’ll refer to. But I remember back when I went to my Department of Agriculture class to do my original wood destroying insect, and all that, and there were home inspectors there, and the question came up, are we allowed to do this service afterward? And the Department of Health was like, we encourage you to do the service after, if you just do a wood destroying insect inspection, you know, they’re basically like, why wouldn’t you offer to go spray or whatever to mitigate the pest issue. So yeah, I haven’t had any issue with any of that, and actually, most of the realtors and stuff in our area, we really only have big national chain companies, and you see one of those things where if you get solely a pest control company that does a pest inspection, you know, a lot of times they’re finding something, so that way they can spray it. And so I actually think in our area, they appreciate that we’re inspectors and that we’re not just looking for pest control work.

Ian Robertson
And you just got done doing the most thorough pest inspection possible, because I mean, have you ever had a, you’ve probably had pest guys on site. I always laugh. They show up, you know, maybe an hour into the inspection, then they walk around for a couple of minutes, they point out a couple of spots, they maybe do something or not, and then they leave. I’m like, I’ve been in the attic, I’ve taken panels off, I’ve looked under things, I’ve been crawl spaces. I’m like, you just kind of walked around and did nothing.

Daniel Dunlap
Right. Yeah, I mean, yeah, you’re absolutely right. And a lot of times, too, they don’t want to deal with the time that it’s going to take to call another company out, and then most of those other companies are going to want to do their own inspection on top of it, and that’s where we see the benefit in the deal if, say it’s a VA deal, and there’s powder post beetles in a crawl space, they have to get it treated for the VA to push the deal through. And so at that point, it’s like, okay, well, you offer them a fair, decent price on doing the treatment, and obviously then we can do the paperwork to satisfy the VA. So it’s just nice to keep it all in house, really, and it keeps these deals moving to where, if I go out and do a pest inspection, and we report that it needs treated well, it’s going to take some of these other pest control companies two weeks to come out and spray it, and then they got to do the paperwork, and then…And so it makes sense, it really meshes well together. And that was the biggest thing I was a little skeptical of, is like, how is this all just going to work out together, you know? And really, it’s pretty seamless, to be honest with you.

Ian Robertson
Yeah, and I would like to point out that the business model that you have is the successful business model that we’ve seen. You basically start another company, and then that other company handles it. You can have a similar name or not, so it’s not like ABC Home Inspections is doing pest control. It’s ABC Home Inspections and ABC Pest Control, you know, two different websites, two different phone numbers. So then you still get your own leads and people with, you know, just having your business around for pest control, and then you also have your home inspection company, and you still keep things relatively separate. But the lead generation, man, being a home inspector, you are a lead generation machine.

Daniel Dunlap
Yes, 100%. And not just for the inspection industry, I mean, how often do we get asked, hey, do you have a recommendation on a roofer or this or that, you know, whatever, and you build a little network of people that you can trust and can actually refer out. Yeah, I mean, I haven’t really figured out how to monetize that portion yet, and I’m not totally sure if that’s a legal thing, but yeah, phones ring nonstop, that’s for sure.

Ian Robertson
Yeah, and there are home inspectors that their state allows them to have a separate company, different LLC, and they’ll go and do home maintenance, like they’ll just contact the people after whatever the limitation is, like a year, and they’ll be like, hey, I’ll come clean your gutters and repair that deck out back, because most people haven’t touched those repairs in a while, and that’s worked out really well for them, but it still doesn’t create the recurring revenue that pest control does.

Daniel Dunlap
And we tried that a little bit, I mean, we didn’t go like full bore on trying that, but we looked into it, and part of the problem we found is a lot of people don’t want to do preventative maintenance, you know, they’re reactive mostly to issues that come up, and you know, at that point it’s like, is it even worth trying to mess with? We looked at doing the annual maintenance inspection, which I think is a great idea.

Ian Robertson
Yeah, nobody can sell those.

Daniel Dunlap
But it’s like, no, then it’s almost a waste of your time, that portion, and we kind of circled that around and around, for I don’t know, you and I had conversations, that was a couple years ago about kind of this stuff, and it just never went anywhere, and we put probably more effort into it than we did the pest control.

Ian Robertson
Yeah.

Daniel Dunlap
And so the pest control, it’s not like we aren’t putting effort into it, but it’s just falling into place naturally, which I think is a big indication of its possible success.

Ian Robertson
I really like how you said that, too. A lot of times we think that business has to be super hard, and there is such a thing as accidental success, but really, when we’re filling a need, that need gets filled up pretty quickly, so we’ll see when, oh, this was the right choice, when it starts to fall together like that. You know, it’s funny, one of the biggest inspection companies in the country does exactly this, so there’s like, I’m going to call it a top 20 list. And at least a few of them do this, and the other ones will have expanded into other things, like engineering, and, and different services. Water treatment is another one, because you get recurring revenue on that one. Man, my water, I bring this up all the time, my water treatment guy, I have to beg him to come over, charges me $150 and I’m like, can you just bring some salt with you, and some hydrogen peroxide. Have to beg him to come over, doesn’t set up another appointment. I have to beg him to come back out in six months because they’re too busy, and I’m just like, man, for a five minute service call, it’s 150 bucks, but pest control is a little bit more oomph to it, because it’s more purchasable. So, imagine this guy coming and saying, like Ehrlich or Terminex or somebody wanting to buy a small company, which they often do. There’s a lot of buyers out there for small pest control companies. Oh, tons of them. One of them, Ehrlich, was actually a bigger one that just got bought up by Terminix, so they buy up small and large companies all the time, but now you’re ready to retire, and you’re like, cool. Now you come and say, hey, we have 280 grand worth of recurring revenue, but I have this inspection company that generates 80 grands worth of new leads every year, not that’s your gross revenue, but it’s less like, every year we add on 80 grands worth of work, direct leads from this home inspection company, their jaws drop, like you get paid to market your business. That’s insane.

Daniel Dunlap
Yeah, I mean, I just saw an ad from Lowe’s that they’re now doing some kind of maintenance subscription, where, I didn’t look into it, but I thought it was interesting, they’ll send you your furnace filters and your stuff like that. But yeah, the pest control is.. I’m really glad you basically convinced me to do it. So, thank you.

Ian Robertson
Yeah.

Daniel Dunlap
My wife and I always talk about not just the business, we have multiple other real estate businesses, but you know, you can’t force it. It’s not to say that you don’t put 100% effort into it, but at some point you’re doing everything right and you’re forcing it and it’s still not working, and it’s like, let’s just be done, you know, so that’s the nice thing about what we’re experiencing with this pest control stuff now. And in your network of your home inspection people, your realtors, those are the ones that we put the word out to, and they’re like, yes, we love it, like we want more, so that’s huge too, and we’ve pretty much organically, for the most part, I know you and I talked about my Google Ads issue, which is still ongoing, but we’ve organically, basically grown the just this spring, but what’s it going to look like when we’re ready to start pouring gasoline on the fire? I don’t know, we’ll see.

Ian Robertson
I think you’re probably not going to have to pour as much gasoline as you think.

Daniel Dunlap
No, I don’t think so either.

Ian Robertson
So there’s another client of ours who did the same thing, home inspection company, and then started a pest control company. So, with Full View Home Inspector Marketing, we didn’t even do a big website or a huge plan, and he’s just getting work, and he goes, I get some online, and because people don’t like the big companies, like you said, they want someone local. Agents were finding him, his contacts were finding him, spreading it around their office, and then more importantly, all he did was add in a software trigger, so that two weeks after the inspection, or six weeks, or whenever, say, ‘Hey, just remember, if you need pest control, here you go.’ And if you’re in a place like anywhere down south, everybody has a pest guy, now you’re the first one in the door. Let us be your pest guy. Cool, you knocked on that door first. It really is, in a business sense, magical. It’s sparkly and shiny and awesome.

Daniel Dunlap
And it’s just convenient for the people, especially like you said, in this day and age. You know, you gotta beg people to come out and service your equipment. And so, when you’re already in front of them and you say, we found some carpenter bees, or whatever, maybe on the outside. And we don’t pick on like household pests, like if we’re at an inspection and we see some regular ants, you know, running around, we don’t flag that, say, hey, you should get a pest control subscription, but it’s one of those conversations where, yeah, hey, we do pest control too. After you close, if you keep having issues, or you want us to come back out, just let us know. And with your other point as well, we do have that trigger in our system, where it’ll send them an email, I think it’s 60 days maybe after the inspection, to give them time to close and move, and all that stuff, about the time they move in and start seeing some bugs around, and there’s a feature where in every summary, we have a little flyer at the top that says, now that you’ve completed your home inspection, click here to get a pest control $50 off or something like that of your first quarterly treatment, you know what I mean, so we have the bare minimum added integrated into the system, but I mean it could be significantly better. And again, the inspection company, organically grew, and I’m just trying to be patient with the pest control stuff, just that way we don’t get, you know, too big for our britches at first kind of thing. But we picked up a couple big warehouses, you know, we have a really big industrial boom in our area, they’re building a lot of manufacturing and stuff like that, and we know a lot of the local business owners, and we picked up a relatively large commercial contract recently, you know, which added a lot to the balance sheet, or whatever you want to call it, which is a monthly service, and so yeah, it’s crazy good, really. I mean, I could even see the pest control company being eventually significantly larger than the home inspection business.

Ian Robertson
And that’s what happens to a lot of these companies, is their pest control becomes bigger, and they view the home inspection as just a good way to make money while advertising your pest control. You know, you’ll have two or three trucks driving around for home inspections, and then seven or eight for pest control.

Daniel Dunlap
Yeah, I mean, you think about it, we’ll probably do somewhere around 300 inspections this year, you know, maybe more, maybe less. It just depends. I mean, that’s all free hot leads, you know what I mean. So, I wouldn’t know what the number of those to be converted.

Ian Robertson
Most of what you’re doing right now is soft sell, so it’s not like, hey, here’s a flyer in hand, then a follow up, and maybe even a phone call. You’d probably have an insane conversion rate if you started doing more aggressive sales. Right now, you’re just like, here it is, take it or leave it, and it’s already generating quarterly revenue for you. That’s incredible.

Daniel Dunlap
Yeah, oh yeah, it is, which is crazy to think about. But yeah, I mean, and we talked a little bit about the logistics thing, you know, we’re jumping back to ACC, you know, and that’s not complete yet, but our phone lines are probably our biggest pain point, and so, I’m just happy to have them be able to continue to schedule inspections and do that kind of thing, and so in my mind, we’re not ready for them to be doing pest control calls yet, you know, active marketing. I just don’t want it to create more confusion, I guess.

Ian Robertson
Yeah, eventually you can just add things on little by little, like now after every client, just a quick phone call, whether they had a pest issue that you found or not, and do that two months after, and then an email with a phone call. Then you can build funnels to send them down, you know. It’s like, oh, we found ants, so here’s our ant funnel, here’s our termite funnel. That’s funny, termite funnel, but I like the point, you kind of circle it a little bit, but whenever you’re marketing, you have to sell trust. Whenever you’ve done an inspection, you’ve sold them on the phone, you’ve sold them on your website, you’ve sold them on your reputation, you sold them with the agent. There’s 15 different ways that you sold them on trust. Then when you switch to pest control for that same client, it’s the easiest sell in the marketing industry, because they already trust you, as long as you’re trustworthy. I mean, if you’re skeezy, they’re not going to trust you, but yeah, you still have to be a trustworthy person. But otherwise, you’re like, you did a great job for me, you reported that issue and saved my family 20 grand. Heck yeah, you’re going to be my pest guy.

Daniel Dunlap
Right. Yeah. I mean, no questions even asked, honestly. I mean, and like you said, as long as you’re…around here, I’m sure there are some bigger areas that shady people can go unnoticed, but I mean, we’re almost 10 years in, and you just can’t be shady that long, for the most part, you know, especially in small communities, where your number one leads are your referrals from your realtor network and stuff like that. But yeah, I mean, and so you’re right, it’s an easy conversion.

Ian Robertson
Yeah, and it’s funny too, talking about the negative aspect of what you just mentioned, this is going to be weird digression in our conversation, but I actually looked up the mathematical probability of comeuppance, like people getting what they deserve, and I forget the term of it, because I’m just pulling this out of my memory banks from a couple weeks ago. They actually have a mathematically statistic terminology for people getting their comeuppance. So basically, it’s mathematical karma, so if you’re skeezy long enough, it comes back on you with mathematical certainty, which is interesting. So, it’s just like, it doesn’t even pay business-wise to be skeezy. So, if you’ve earned somebody’s trust, be trustworthy, and you’ll do a lot better in life.

Daniel Dunlap
Yeah, and that’s like our entire business model is we focus on the client, obviously, what’s best for them. You know, a lot of these clients really see us as a strategic partner in their entire buying process. You know, inspections are just getting more and more thorough, more and more documentation, and all that. So it’s obviously a lot of work, and you spend a significant amount of time with these clients, especially if they show up, which a lot of them do and we encourage. It makes things a little bit longer when we have clients around, but I think the experience is significantly better when they show up and do that, and you build a personal rapport with them. And I have people calling me after the fact all the time, just ask random questions, so it ends up you get the people that you do multiple inspections for, and it’s like, hey, recently, the guy says you did my daughter’s inspection last year, or something like that. Now we’re buying a house, and similarly, you did a family member’s inspection, and we have some crawl space issues, and we do a little bit of the mold stuff, and so we’ve kind of lumped in some of the crawl space services, which I know you’ve seen on our website, obviously you put it there, but I mean, when you’re a good person and you do good work and you have a good business, it’s just word of mouth for the most part, I mean.

Ian Robertson
Yeah, we don’t put enough stock in that. Just being a good person, doing good work, that really does a lot.

Daniel Dunlap
The money and the success will come after the fact, if you can focus on the right things and build a good business, which is what we found. And I’m sure it’s the same scenario with pest control, and, like, you’re saying, you build a personal rapport with these people, they trust you, and you’re a strategic partner through them, and one of the biggest purchases, probably of their life. And then, yeah, of course, if they see bugs after the fact, we’re going to be the first one they call.

Ian Robertson
It’s true. Now, besides the obvious trust and everything that you’ve built up over the years, there’s home inspectors listening to this podcast, and you know who you are, that I’ve tried to convince now for years that this is the way to go, and they’ve tried the annual home maintenance inspections. No one’s ever gonna do it, guys. I’m sorry, I’ve tried for 20 years. Put it on your website, it’ll be the page that nobody ever sees, nobody ever cares about. They’ve tried everything under the sun except pest control. What would you tell them would be the best way to start, like, what got you started? Like, we talked about it for years, too.

Daniel Dunlap
A lot of years. I was just kind of at the point where, and this was probably a more personal thing for me, but I was at the point where it’s like, well, what’s next? You know what I mean? Am I just going to keep doing inspections the rest of my life? You know, which is fine. I could totally do that. But for me it was more or less, it was the exit strategy, you know, in-game planning, and if I do this for another 20 years and retire, that would be, that was the ultimate why we did it, I guess, you know, because at the end of your long hard career, sure, you can have made a lot of money doing inspections, but then, like, you said, what’s it worth? You are the business, and I didn’t want to see that. I wanted to be able to, I wanted a generational business, you know, to where I could retire eventually. I can have a handful of inspectors, a handful of pest control technicians. You know, my wife and I don’t have kids, but we have nephews and family members, and it’s just like, even if got to the point where nobody in the family wanted to keep doing any of what we’re doing, then, yeah, then you can just sell it. But the first thing we did was got the licensing in order, because we needed a separate business license, and all that pest control stuff, and then I think really the second thing we did was reached out to you and got our website, second website up and running. It’s a lot of logistical stuff, the website, the additional phone numbers, additional emails, additional software, and so that was kind of, I mean, it probably took six months just to get the little stuff down to where we could even start saying we offer this service, and honestly, that’s just kind of what we did, and then it organically grew, and yeah.

Ian Robertson
So there’s some good actionable items in there. First of all, we have to be motivated, I think, is the first thing, and you were motivated by an existential, where do I go from here? And I think that’s where a lot of us end up after a while, especially after five, ten years in the inspection industry. It’s like, where do I go from here? Because you know, it’s like, do I want to grow into a monster 20, 30, 40 inspector company? Do I want to stay solo, or do I want to go in a different direction, like you said So be motivated, like it’s got to be in there. The second thing you said was, get your licenses, and I think that’s important, because it’s really hard to make your business plan out without understanding the logistics of what you need to do. Oh, I need one containment for some of these chemicals, or you know what, maybe I don’t want to work with these chemicals, and I want to get this different kind of license. So now you have to change all your marketing around if you’re trying to get that all done ahead of time. Get your licenses, know what you’re going to do. For you, though, did you want to get some on-site training with a company, or how did that work for you?

Daniel Dunlap
For the pest control stuff? Well, I was kind of just self-taught, honestly. I mean, over the past eight years, or whatever, you know, I’ve been doing pest control here and there, just on a small scale, and never really had time or the want, really, to grow it any further. There’s a little bit of a learning curve, but I mean, you got to go to get your, you’ll sit through the classes at the Ohio Department, or whatever, you know, state regulator does, you know, pest control in Ohio, it’s the Ohio Department of Agriculture, and so they’re going to make you go take your classes and sit through the seminars and do all that stuff, obviously before you get your license and go take the tests. I think having the base knowledge as an inspector on the pest control stuff, you’re pretty much already set up to roll right into it. Now, if you’re a brand new inspector, and you’ve only done, you know, 12 inspections, yeah, I wouldn’t recommend going out and just winging it, essentially, but I don’t know. I guess that’s kind of what we did.

Ian Robertson
Well, and I mean, what’s that old expression? Better a half thought out plan by a lion than a fully thought out plan by a sheep. You know, basically sometimes you just got to get out there and do it to an extent. I see people that plan for years and never do it.

Daniel Dunlap
Well, and I’m a big proponent of on-the-job training, you know, I like kind of kicking people to the wolves and letting them figure it out themselves, with obviously some oversight. Yeah, you just got to go out and do it, as long as you don’t make any catastrophic mistakes and you learn along the way, you know, so…

Ian Robertson
And what about insurance and stuff?

Daniel Dunlap
Insurance, there is separate insurance requirements, so you know, you gotta have separate insurance policy, you know. We bought a couple power sprayers, which are not cheap. So, you have a little bit of upfront cost, but for the most part, I mean, we haven’t spent an astronomical amount of money, getting it up and running, either.

Ian Robertson
I think that’s what keeps some people back from it. People want a proven system, like they’re worried about buying all the pumps and all the chemicals and going through all the expense and not knowing if it’s going to work out. But I mean, no risk, no reward. But at the same time, so few inspectors do it that I think in most markets you’ll probably be fine. Northern markets are going to be a little bit harder because less pest control, and I think deep south, like Florida, and stuff like that, you’re going to have a little bit of a hard time because everybody’s pest control operator there, but most markets, like 80% of markets, I think are going to be pretty solid wins.

Daniel Dunlap
Yeah, I mean, honestly, I feel like home inspectors could really just take over the pest control industry.

Ian Robertson
I think so too, very easily.

Daniel Dunlap
Honestly, I think the pest control industry should be a little scared, but, yeah, I mean, it’s obviously not super easy, but, like, we said, it falls into place if you do the right things, and, yeah, so, the nice thing is you train an inspector, and then all you have to really do is have them go get a little bit extra, you know, to be able to spray, so you can cross train your inspectors as technicians, which is really convenient. I mean, labor, and I have other businesses that don’t have skilled labor, but have labor, and that’s difficult to keep people, that’s the hard part, but that’s why we kind of, you know, started training my brother-in-law and stuff like that. We’ve had a couple bad experiences with people that we’ve brought in that we shouldn’t have, and it took us probably a little bit longer to realize that, you know, but now we’re pretty guarded with really who we let in, who we, basically let around and in the business circles, and that kind of thing.

Ian Robertson
And I mean, I think people are going to be the hardest part of any business, to be honest with you. I mean, man, we need to have another podcast about that, because it is the hardest part, hiring employees, getting people to show up and be good, and you know. But I do want to bring out, because we’re running out of time here, but you brought out a very beautiful tertiary benefit to the pest control, and I was just talking to a guy yesterday, because he’s having a hard time transitioning, he does like 400 some odd inspections a year, and he’s like, how do I get a whole other inspector on without tearing things down and redoing it. And as you’re talking, I’m like, that’s perfect. Cross train him as your pest guy. Now he’s doing inspections, and when he’s not busy with that, he’s doing the pest control, and it’s just.. it’s beautiful.

Daniel Dunlap
Yeah, I’ve had..I mean, my brother-in-law has been out every afternoon this week, doing either pest control or an inspection. And now, he started studying and training and doing his inspection stuff over a year ago, so I mean it’s not a fast process, you know, but once you’re there, you’re there.

Ian Robertson
Yeah, man, Daniel, I really can’t tell you thank you enough, and I know you’re early in this, but after you told me how well you’re doing already, just being, you know, just a few months in, I’m just like, all right, come on, this is showing exactly how this model is the best model possible, and I’m going to quote you, that might even be the title of our podcast. Home inspectors could take over the pest control industry.

Daniel Dunlap
I really do, honestly. I mean, yeah, it’s just, when it works out well, it works out well, I guess.

Ian Robertson
Yeah, man, I’m gonna take this one to the bank. I really appreciate you being on, taking your time in your riverside cabana, and being with us, Daniel.

Daniel Dunlap
Well, I thank you. I mean, you’ve been a key player in all of this, obviously. You’ve had our original home inspection website since the beginning, and you have our other website. I tell people locally, to be totally honest with it, you are a mentor of my business, because that’s how frequently we talk, you know. And I come to you for a lot of advice, some I take and some I don’t, but this was a very good decision. So, yeah. Thank you.

Ian Robertson
Wow, okay. Well, now you’re gonna make me cry. There we go. Very kind. No, I’m just joking. But no, those are very kind words. Thank you. And we’ll have you on again, because I want to follow up with you on how well things are going over time.

Daniel Dunlap
Absolutely.

Ian Robertson
You have a great day. You’re a busy guy, and I appreciate you taking the time.

Daniel Dunlap
Thanks, Ian. Let’s talk soon. All right.

Outro: On behalf of myself, Ian, and the entire ITB team, thank you for listening to this episode of Inspector Toolbelt Talk. We also love hearing your feedback, so please drop us a line at [email protected].

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*The views and opinions expressed in this podcast, and the guests on it, do not necessarily reflect the views and opinions of Inspector Toolbelt and its associates.

PODCAST SUMMARY/BLOG

Home inspection is a strong business, but it has a built-in limit: most clients buy once and disappear. That makes revenue lumpy and makes small business valuation tough when you finally want an exit strategy. A recurring revenue service changes the whole picture. In this conversation, a working home inspector explains why launching a pest control business alongside a home inspection company can create predictable cash flow, increase annual recurring revenue (ARR), and turn an owner-operator job into an asset someone will actually buy.

The key idea is simple: pest control runs on service agreements. Quarterly pest control programs and monthly commercial service create monthly recurring revenue (MRR) that buyers can measure and finance. That matters because a home inspection business often depends on the inspector’s personal reputation and availability, while a pest control route can be staffed, scheduled, and scaled. When you can point to contracted revenue and retention, you move from “I do inspections” to “I own a recurring revenue company,” which is a different category of business entirely.

There’s also a practical reason pest control fits naturally with inspections: you already find the problems. Wood destroying insect (WDI) findings, termite activity, powder post beetles, and carpenter bee damage come up during real inspections, especially on VA loans that require treatment and documentation. Clients want speed and clarity, not a second company delaying closing for two weeks. Keeping the inspection report, treatment, and paperwork in one system can keep real estate deals moving while offering a fair, transparent price that doesn’t feel like a hard upsell.

Doing it right means respecting regulation and logistics. Pest control requires separate licensing, separate insurance, proper chemical storage, and careful application around sensitive areas like ponds, pets, and gardens. It also requires scheduling discipline that feels different from home inspections. Many inspectors underestimate the operational details: routing, billing, phone lines, software, and audits. The payoff is that once those foundations are in place, growth can feel surprisingly organic because homeowners already need pest service and local providers are often overloaded.

Marketing is where the advantage becomes obvious. A home inspector is a lead generation machine built on trust. By setting up a separate pest control brand with its own website, phone number, and follow-up triggers, you can offer pest control after closing without muddying your inspection identity. A simple email 60 days later, a small coupon, and a mention in the summary can outperform aggressive sales because the client already believes you’re thorough and honest. Over time, you can cross-train inspectors as technicians, smooth out workload, and build a scalable team that supports both services while creating a business with real transferable value.