Food Processing Plants Represent High-Value Targets for Pest Control Marketers

Dec 29, 2005, 00:00 ET from Kline & Company

    LITTLE FALLS, N.J., Dec. 29 /PRNewswire/ -- In a mature market like
 commercial pest control, new growth opportunities can be as scarce as a
 dragonfly in the desert. But food processing plants and newly opened
 restaurants may offer the best chance for pest control companies and their
 chemical suppliers to increase market share, according to a study soon to be
 released by Kline & Company.
 that about 25% of food processing plants still use their own employees to
 coordinate pest control management, as opposed to an outside pest control
 company. In contrast, more than 90% of restaurants, kitchens, and warehouses
 -- which make up the bulk of the food-handling pest control market -- use
 contractors. While food processing plants represent a smaller market segment
 overall, each plant is a high-value source of potential revenue for both the
 pest control companies and pesticide marketers.
     Kline's study shows that, in general, restaurants and other facilities
 operating kitchens are almost entirely dependent on pest management companies
 for monitoring, diagnosis, and treatment. Warehouses and food processing
 plants, while relying heavily on pest management professionals, are somewhat
 more likely to use employees for this activity.
     The implication for the industry is that growth for pest management
 services in the kitchen categories will have to be based on increasing the
 number of restaurants and schools serviced, whereas there is an opportunity
 for increased market penetration in warehouses and processing plants.
     "If you know that you're peaked out in restaurants, and that 90-plus
 percent of them already have a pest control operator, you have to grow by
 taking share from somebody else," says Dennis Fugate, industry manager of the
 Specialty Pesticides practice for Kline's market research division. "On the
 other hand, if you can get a plant to convert to pest control, a single plant
 is probably worth 10 or more restaurants in terms of volume, though they're a
 smaller segment of the market."
     Kline's study pegs the U.S. market for professional pest control services
 at $5 billion in 2004. Commercial food-handling activities are likely to
 represent about $1 billion in service revenue and nearly $100 million in
 chemical use. Commercial food handling involves more than 600,000
 establishments across the continental United States. Of that total, there are
 more than 42,000 food processing plants, including everything from canneries
 and bakeries to slaughterhouses and meat packagers.
     "For pest control marketers, the continued use of employee-managed pest
 control by a good number of food processing plants indicates a dual strategy
 is needed to ensure full coverage of the market -- one that targets not only
 the pest control segment but also examines where food processing companies
 purchase pest control products," says Mancer Cyr, senior associate in Kline's
 Specialty Pesticides consulting practice.
     The study also tracks an undercurrent of dissatisfaction in the market
 regarding methods for dealing with flies, specifically in food processing
 plants. However, some of the dissatisfaction may also be an indicator of the
 persistence of the problem.
     "In completing our survey, we noted that there's a definite interest in
 new product forms and finding safer ways to handle fly problems with reduced
 exposure to pesticides," says Fugate. "Flies are tough, though," he adds. "You
 open the door for 10 seconds and you might end up with a fly infestation,
 regardless of how clean the facility is."
     He notes that pest management companies are looking to address this issue
 by developing preventative methods that focus on exclusion -- teaching clients
 to improve sanitation and keep doors closed, as opposed to using chemicals.
     Food handling accounts for a major portion of the overall general pest
 market, but researchers usually consider it only as an embedded segment of the
 total market picture. Kline's new study is the first large-scale market
 research effort to focus specifically on opportunities for pest control
 operators in food-handling establishments.
 methods, application responsibilities, products, costs, and market trends for
 controlling pests in seven different classes of food-handling establishments,
 including restaurants, hospitals, hotels, schools, food processing plants, and
     For more information on this study, go to or
 contact Dennis Fugate at +1-410-418-8934 or In
 Europe, contact Pilar Pardo at +32 2 776 0737 or
     For information on the customized consulting capabilities of Kline's
 Specialty Pesticides Practice, contact Mancer Cyr at +1-856-764-3536 or
     Established in 1959, Kline & Company ( is a management
 consulting and market research firm serving clients worldwide in the life
 sciences, chemicals and materials, consumer products, and energy sectors.
     For more information, contact:
     Dennis Fugate
     Industry Manager, Agribusiness

SOURCE Kline & Company