American Home Shield 2011 Annual Report Download - page 19

Table of Contents
regional and local owner-operated companies. Regional and local competitors operating in a limited geographic area may have lower labor, benefits and
overhead costs. The principal methods of competition in our businesses include name recognition, quality and speed of service, pricing, customer satisfaction
and reputation. No assurance can be given that we will be able to compete successfully against current or future competitors and that the competitive pressures
that we face will not result in reduced market segment share, reduced pricing or adversely impact our reputation, business, financial position, results of
operations and cash flows.
We may not be able to attract and retain qualified key executives or transition smoothly to new leadership, which could hurt the Company and its
businesses and inhibit our ability to operate and grow successfully.
The execution of our business strategy and our financial performance will continue to depend in significant part on our executive management team and
other key management personnel and the smooth transition of new senior leadership. As a result of a more aggressive strategic plan, we have decided to
enhance many of our senior management positions, including the hiring of Thomas J. Coba as President, ServiceMaster Clean, Merry Maids, Furniture
Medic & AmeriSpec, Roger A. Cregg as Senior Vice President & Chief Financial Officer and Charles M. Fallon as President, Terminix, as well as moving
Thomas G. Brackett to a new position as President, TruGreen. Our future success depends in large part on our success in utilizing current, experienced senior
leadership and transitioning responsibilities to, and implementing the goals and objectives of, our new business unit executives. In addition, any inability to
attract in a timely manner qualified key executives, retain our leadership team and recruit other important personnel could have a material adverse impact on
our business, financial position, results of operations and cash flows.
Public perceptions that our products and services are not environmentally friendly or safe may adversely impact the demand for our services.
In providing our services, we use, among other things, fertilizers, herbicides and pesticides. Public perception that our products and services are not
environmentally friendly or safe or are harmful to humans or animals, whether justified or not, or our improper application of these chemicals, could reduce
demand for our services, increase regulation or government restrictions or actions, result in fines or penalties, impair our reputation, involve us in litigation,
damage our brand names and otherwise have a material adverse impact on our business, financial position, results of operations and cash flows.
Changes in our services or products could impact our reputation, business, financial position, results of operations and cash flows.
Our financial performance is affected by changes in the services and products we offer our customers. For example, when Terminix transitioned from
offering primarily bait termite services to providing both liquid and bait termite services, this transition required the purchase of additional equipment and
additional training. The bait and termite service lines also have different price points (for both the initial treatment and for renewals), different ongoing service
obligations and different revenue recognition policies. An unsuccessful rollout or adjustment of our new services or products could have a material adverse
impact on our reputation, business, financial position, results of operations and cash flows.
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