Making Sense of Customer Service Agreements

To protect your customer and your business, start every new client relationship with a solid contract that spells out exactly what services are covered  

Alot of confusion surrounds the use of customer service agreements: When are they needed? How important are they? Are they even needed at all? 

For many professionals, however, they are a non­negotiable part of doing business. “Everything we do is written down,” says Bill Welsh, vice president of operations for Rose Pest Solutions. “The client has to approve it—and they have to sign off on it—before we do any work.” 

Customer Service Agreements: What Are They? 

According to Marie Horner, vice president of government affairs for Arrow Exterminators, a customer service agreement is an agreement between a service provider (the pest control company) and a customer. At its broadest, highest level, it outlines the scope of the service provided, the time limits for completion, the payment terms, and any other important details. “An agreement is putting the expectation of service on paper,” she says. 

A written customer service agreement is like a contract—and many people use the terms interchangeably—but unlike a contract, it can be canceled at any time. “Where a contract may lock somebody in for two or three or even five years, with an agreement, if you’re not happy and you don’t want us to continue, we’ll go,” Walsh says. “We’re not going to hold you hostage to a contract.” 

They can be simple or complex, depending on the services provided and the type of customer, but in all cases, service agreements set clear expectations. “It’s a clear understanding between both parties,” says Mickey Thomas, senior vice president of customer care department and inside sales for Arrow Exterminators. “Here’s what we agreed to, here’s what we cover, here’s what your property is protected by. It’s just the clear documentation from both parties that this is what’s covered.” 

Are Written Customer Service Agreements Needed? 

The short answer is not always. While most states do require written agreements, a few allow verbal agreements, which reduces the often-complex agreement to the level of getting a haircut: A customer asks how much, is told a price, and if the customer agrees, the service is performed.  

“Michigan actually doesn’t require a written agreement,” says Welsh, whose company operates in six states, including Michigan. “You can have an oral agreement if you want. But in all our operating areas, we have written agreements. It’s just a standard policy for us.” 

A verbal agreement might be a valid type of agreement in states like Michigan, he says, but it doesn’t really account for the complexity of the work. Plus, he says, who is going to remember what was agreed to in five years? Having a written agreement limits the scope of liability and prevents a lot of potentially disruptive misunderstandings. 

Occasionally, his company will acquire smaller firms that always operated with nothing more than a handshake. However, Rose Pest Solutions requires the newly acquired customers to sign its agreement to continue service. “If it doesn’t have agreements, the company doesn’t have anything to sell,” he says. “So, we tell the companies we buy that we’ll give them a percentage of those agreements, so the companies have a vested interest to make sure their customers sign with us.” 

Part of the confusion around whether written agreements are needed comes from the fact that they are state requirements and not all states require the same things. However, though a state might not require a written agreement, if a company chooses to use a written agreement in that state, that agreement must satisfy certain requirements, and there is no one-stop shop that provides that information in any state. 

For example, you can’t just go to North Carolina and ask what needs to be in a contract, Horner says. There is no umbrella organization that will tell you what you need to have. 

“Most people in our industry will start with the U.S. Department of Agriculture, and that’s a good place to start,” she says. “But the Department of Agriculture won’t tell you if one is required. What they will tell you is that if you have a contract/agreement in this state, these are the things that have to be in it.” 

States can also have additional requirements dictating font size and the use of specific language. Florida, for example, requires the agriculture commissioner to be listed, so when there is a change in commissioners, agreements need to be updated to include the new name. Texas requires certain graphing information. 

Horner has heard the arguments against having a signed contract but agrees with Welsh that using written service agreements is important. 

“People say they’re not going to have a written agreement because if there’s a problem, it becomes he said/she said, and then they have to take it down to what the actual service was and if there was implied negligence or that type of thing,” she says. “So, some companies really believe that a contract will get you in more trouble than not having one. But the reality is, in most states you need a contract, and we as a company really believe that a written agreement is in the best interest of both parties.” 

Why Are They Considered Good Business? 

At Arrow, nothing happens without an agreement. Service is set up based off what is in that agreement. 

“In my world, the biggest reason why written agreements are so important to use is what they spell out,” Thomas says. “And if we ever have to go to collections, we have to have a signed agreement before we can turn it in.” 

Horner agrees. “That compensation piece is going to specify when it’s due on demand—due in 10 days, due in 30 days—and that’s all needed to start your collections.” 

Sometimes, agreements must be updated because of changes introduced by the customer. Home additions might add linear footage, or landscaping work might affect termite baiting stations around the home. In the commercial arena, there might be occasions where a third-party company is hired by the customer to handle billing or a safety agency is brought in, increasing the expectations you originally agreed to. 

Having a written agreement clearly outlines the scope of service and eliminates conflicts when these additional issues pop up. A written agreement also helps when additional requests are made. If a customer has pest control service, the agreement will spell out what is covered. If that customer later comes back and says they have mosquitos, the agreement will clearly show that they have pest control coverage and that mosquitos would be a separate agreement. 

What Should Be Considered? 

Horner recommends seeking legal advice in your state and then looking at state statutes, because in many cases there can be a domino effect. 

Offering termite protection, for example, might lead to offering financing, which means you have to look at state tax law, because financing falls under state tax law, not contract law. Because of this complexity, customer service agreements are substantial documents. 

“These aren’t just one-pagers,” Welsh says. “The standard termite agreement is 11 inches by 14 inches front and back, fully loaded. And then you’ve got your graphs and exceptions, so it turns into several documents.” 

In the case of bed bugs, where a company might have to heat-treat the structure, the agreement spells everything out going into the treatment, so everyone knows what’s going on and what’s expected. Welsh says Rose Pest Solutions even goes so far as to use pictograms to show customers how to prepare. 

“It’s one thing when you break it down,” he says. “But pictograms help out a lot, because they take the confusion out of it. When the customer says they weren’t shown what to do, we can say that yes, we did show you—and here’s the picture.” 

Where Can Help Be Found?  

Arrow Exterminators and Rose Pest Solutions are both large companies with lots of resources, but often new businesses start with nothing more than a very broad—or very narrow—understanding of the work. 

“Because those starting a business most likely worked for a pest control company before, they might take a sample of that agreement, but then you’re only using what you think is valid because that’s what [the other company was] using,” Horner says. “It might not be.” 

Fortunately, she says, NPMA members have access to legal and human resources. “I would take advantage of the resources provided by NPMA and then look to the state pest control associations,” she says. “Since they’re state-oriented, they typically have the resources you need.” 

The important thing, Horner says, is realizing the value of having that solid written agreement. “It reduces the risk of having a dispute, and that’s what we want—we want to have clear communication and a good experience for both parties,” she says.  

Welsh concurs. “A customer service agreement cuts out a lot of nonsense,” he says. “Our employees know what they need to do, the client knows what’s expected of us, and I think that’s really what it is: a mutual understanding. And as long as we’re on the same page, everything’s fine.”  

A customer service agreement cuts out a lot of nonsense. OUR EMPLOYEES KNOW WHAT THEY NEED TO DO, [and] the client knows what's expected of us.

-Bill Welsh, Rose Pest Solutions

Customer Service Agreements: NPMA’s Exclusive Member Resources    

NPMA offers its members an invaluable resource: a comprehensive collection of sample contracts tailored to various pest control services. These professionally crafted agreements help pest management professionals protect their businesses and clearly communicate service terms to clients. 

Available contracts include: 

1. Organic Pest Management Service Statement 
2. Fumigation Service Contract 
3. General Household Pest Control Contract 
4. Bed Bug Contract 
5. Model Baiting Contract – No Repair 
6. Model Baiting Contract – With Repairs 
7. Termite Contract – Retreatment Only 
8. Termite Contract – Retreatment and Limited Damage Repair 

These contracts cover a wide range of services, and each is designed to disclose service details, including important disclaimers and limitations. 

While NPMA provides these model contracts as a starting point, it’s crucial for pest control companies to have their legal counsel review and adapt the agreements to meet specific company needs and comply with local regulations. 

NPMA members can access these valuable resources exclusively through their membership, giving them a significant advantage in protecting their businesses and maintaining clear communication with clients. 

Find these resources at npmapestworld.org/contracts.