Are Bedbugs Bad for Business? It Depends

Jonell Bolivar uses steam to fight bedbugs at the Chancellor Hotel in San Francisco.

Recent reports that bedbugs have infiltrated office buildings, movie theaters and stores in New York did not come as a surprise to Wes Tyler, general manager of the Chancellor Hotel on Union Square in San Francisco.

Scooby's nose finds bedbugs. Linda Develasco, who does inspections for the insects, said she bought the dog for $9,700 and made that back in three months.

“Short of putting a bedbug-sniffing beagle at your door to check everyone before they come in, you’re going to get bedbugs,” he said. “Dealing with them is the cost of doing business these days.”

An employee first discovered a bedbug in the 137-room hotel in 2003, and Mr. Tyler has since instituted a comprehensive bedbug detection program to find the blood-sucking insects before a guest does. For starters, Mr. Tyler created a position called “bedbug technician” — an employee whose sole job is to go from room to room checking for bedbugs. There is also a bedbug bounty of $10 paid to any employee who finds one.

If a bedbug is found, the room and all adjacent rooms are taken out of service for up to five days while they are steam-cleaned and chemically treated to eliminate the bugs and their eggs. The mattresses in the rooms are also discarded. The total cost for each room is $2,500, including lost bookings.

“It sounds like a lot of money, but the value of a good reputation is infinite,” Mr. Tyler said. “Your biggest fear is that someone will get bitten and post something about it on an online travel site, and that’d be a killer.”

Bedbugs used to be solely a residential problem, but they are showing up in commercial settings, and not just in places with beds like hotels, nursing homes and apartment complexes. Increasingly, pest control companies report finding bedbugs in office buildings, movie theaters, clothing stores, food plants, factories and even airplanes. For the affected businesses, the expense can run into the hundreds of thousands of dollars. For the companies that deal with the scourge, it is a bonanza, with business doubling and tripling.

The costs of coping with bedbugs are significant, and they are not covered by most insurance policies because they are seen as a maintenance issue. Hiring bedbug-sniffing dogs, which is considered the most effective detection technique, costs about $250 for a 1,200-square-foot retail store and as much as $10,000 for a million-square-foot department store.

“To stay ahead of bedbugs, I recommend having the dogs come through quarterly,” said Pepe Peruyero, chief executive of J&K Canine Academy in High Springs, Fla., which trains bedbug-sniffing dogs and offers inspections for large buildings like department stores and school dormitories. However, he added, many customers cannot afford it and instead choose to rely on the vigilance of employees after an initial dog check comes up clean.

Eliminating infestations is also costly, ranging from $750 for a few rooms in an office building to $70,000 for a large apartment complex. And that is just for the application of the cocktail of pesticides that kills bedbugs. It costs an additional 40 percent for the gold standard regimen of placing all the contents of an office or retail space into a heat chamber — bedbugs die at 120 degrees — and then spraying pesticides in the temporarily empty rooms.

“It takes about four to seven hours per room” for the combination heat and pesticide procedure and a couple of hours on three separate occasions if using pesticides alone, said Judy Black, technical director for the Steritech Group, based in Charlotte, N.C., which provides pest control and other quality control services to commercial customers. “Getting rid of bedbugs is not quick or easy.”

Businesses lose money when they have to interrupt operations. In addition, they may have to destroy bedbug-infested merchandise. Abercrombie & Fitch, for example, had to close two of its stores in New York in July, one for four business days and another for five, to deal with bedbug infestations. A representative confirmed disposing of merchandise but declined to comment on the cost.

The managements of the Empire State Building and the AMC Theater chain were similarly tightlipped about the cost of dealing with recent bedbug infestations.

“Nobody wants to talk about this even though it’s happening everywhere,” said Ron Harrison, director of technical services for Orkin, a pest control company based in Atlanta, whose commercial business has more than tripled since 2008. “I spoke at the Mobile, Ala., chapter of the National Apartment Association and asked for a show of hands of who had experienced problems with bedbugs, and not a single hand went up, and right there in front of me were three of our customers who I know had us out to treat for them.”

The silence, of course, is to avoid the stigma of an infestation. Even if businesses manage to avoid media attention, they may end up on one of several Web sites like bedbugregistry.com and bedbugreports.com, which encourage people to report hotels, apartment complexes, offices and retailers where they saw or were bitten by bed bugs.

Read Full Article »


Comment
Show comments Hide Comments


Related Articles

Market Overview
Search Stock Quotes