Planning on outsourcing your customer service but aren't sure of how much it costs? Read on for a guide on call center outsourcing costs
Customer service is the key to the success of any business. Whether that’s managing incoming customer issues or facilitating new customer outreach, you want to ensure that your customer service is at an optimal level and facilitated through a top-notch call center service.
Of course, you want to be economical, too. So, the question you may find yourself asking is should I outsource my call center? And how much does it cost to outsource a call center?
This guide will review call center outsourcing costs and identify some of the key terms you should know when evaluating costs. It will also compare the costs of in-house call centers compared to outsourced call center services to help you make a decision that benefits you and your customers.
Step #1: Identify The Type of Call Center You Need
Outsourcing your call center will generally be a more economical option compared to maintaining an in-house call center—we’ll go into why in a bit.
That being said, you must identify the specific services your company needs. Not all call centers are the same, which means call center pricing will differ depending on the services they offer.
Before looking into the call center pricing of each type, it’s worth going over the two types of call center services so you can evaluate what call center option is right for your business:
Inbound call center – When the average person thinks of a call center, this is likely where their brains will go first. That’s because this type of call center deals with calls from customers. While there is room for cross-selling and upselling in these interactions, the main concern is to deal with customer support, questions, complaints, and troubleshooting.
Outbound call center – This is when representatives of your business call customers directly to sell your product or pitch opportunities. Thoughtful, targeted outreach can help grow your business and establish your company as a trusted expert in your field.
Step #2: Explore In-House Call Center Costs
Facilitating both inbound calls and outbound calls can be time consuming, especially if you don’t have a dedicated call team on staff. To that end, you may start to question whether this is a call center operation you want to outsource or one you’d like to implement into your business plan.
After all, if you keep your call center in-house, you can ensure the quality of the calls and keep your customer base happy (though there are also dedicated outsourcing options that can do this as well). And how much more can it really cost?
The truth is, there are several costs you need to consider before trying to implement your own in-house call center:
Base salaries for all agents – On average, agents are paid $18 an hour nationwide
Salaries for managers and executives – The median salary is $86,900
Technology and hardware – You can typically expect to spend around $4,000 a year
In addition, you’ll also need to consider costs in relation to benefits, training, hiring, and facilities if you choose to house your call center outside of your current headquarters.
Furthermore, if your model of in-house call center would be work-from-home (to save on facilities), you’ll still need to take into account the cost of providing your WFH customer service agent with the necessary technology, such as computer monitors, headsets, and CRM software. You’ll also need a team to support them when issues arise.
Working with an outsourcing company that offers call center services may be more economical than in-house services because there are fewer associated costs, limiting your expenses to the following:
Salaries for agents – You’ll still have to pay for the agents who will be working for you, but the way these costs break down can vary. In addition, you won’t be responsible for benefits, facilities, training, and technology costs at the same levels as you would for in-house services.
Starting fees – Whenever you begin an outsourcing relationship, there will be initial fees you’ll have to cover. There are clerical fees, background checks, and other costs that may accrue before you begin working together. These fees can range anywhere from hundreds to thousands of dollars.
Service costs – These are different from your starting fees as these will be ongoing. The amount you pay will depend on the outsourcers you work with, your phone call volume, and the number of dedicated agents needed.
Miscellaneous costs – If you need specialized services, such as bilingual agents or specially designed technology that provides multiple chat elements, these factors may increase your outsourcing costs.
In addition to these starting expenses, your outsourcing call center cost will also depend on whether you’re implementing an inbound or outbound call service.
When dealing with an inbound call center, there are three main pricing structures you can expect to see:
Shared – This is the most economical option and may be the best fit, especially if you are a small business. In this model, a pool of agents takes your calls as well as calls from other businesses. You are charged based on the amount of minutes agents deal with your calls. If your call volume is on the low side, this may be a smart option. Typical rates you might see for shared outsourcing are:
US/Canada: $0.75 - $1.25 per minute
International: $0.27 - $0.45 per minute
Dedicated – The dedicated option provides you with agents who will only focus on your business. This allows them to provide more tailored knowledge to your customers. Also, if your call volume is high, it may be a better pricing model than the per-minute rates you’ll find in the shared model. Typical rates for dedicated outsourcing are:
US/Canada: $20 - $30 per hour
International: $8 - $15 per hour
These rates may go up if you require agents with specialized knowledge.
Monthly – You’re unlikely to find this style of pricing if you’re looking anywhere in Europe or North America. However, some dedicated call centers may offer a monthly rate rather than hourly pricing.
Outbound call centers aren’t waiting for your customers to call them. Instead, they’re reaching out to your customer base to generate sales and leads, following up on mailers, and, in some cases, even appointment setting for your business. This means they’re likely to be working more than inbound call centers. It also means they’re likely to be more expensive.
To that end, the costs for an outbound center can be broken down three ways:
Hourly – You’re likely already familiar with how hourly pricing works. This is the most common form of pricing for an outbound call center and provides you with a fixed-cost model you can easily incorporate into your monthly budget.
Performance-based – If you’ve ever worked on commission you know how this pricing model works. This is a rarer structure to find as the center you outsource to is taking on a lot of risk by not having a guaranteed pay structure. It can also be risky for you as you can’t be sure what your costs will be in advance.
Combination – This structure combines the two previous structures. You pay a base hourly rate and agents can earn commissions based on performance. This may turn out to be pricier for you, but it also incentivizes your agents to conduct top-quality customer service.
You may notice that there weren’t any specific prices listed in the outbound center breakdown. In part, that’s because there is a great range based on location. This is true for inbound centers as well, which is why the rates given were “typical” and were within a range.
As such, it will cost more if you decide to outsource to a location within the US or Canada. You may be able to save by looking to European markets, and Asian off-shore outsourcing will likely provide you with the cheapest opportunities. However, outsourcing to foreign countries may also make it more difficult to ensure the quality of your calls.
To give just a few examples of what you can expect for hourly rates on outbound call centers based on location, consider the following:
United States/Canada: $20 – $30
Western Europe: $40+
Eastern Europe: $12 – $25
Latin America: $8 – $18
India: $6 – $10
As you can see, prices vary greatly. While it may be tempting to simply outsource to Asia to save money, it’s worth thinking about some of the costs beyond pure economics:
Language barriers – While you can expect that agents in a call center will speak English, their command of the language may vary. If you’re only looking to save money, you may be sacrificing customer satisfaction.
Disconnected customers – Regardless of the talent of the individual agent, your customers may feel like their concerns are also being outsourced and lose the feeling of connectivity and loyalty to your business.
Outsource with Nexa
While in-house call centers provide certain benefits, such as proximity, outsourcing your calls can streamline your business operations and provide your customers with the care they deserve. To that end, you’ll also need to account for certain costs, such as hourly rates, setup fee, starting fees, and service costs.
Our 24/7 virtual receptionists handle your calls, chats, sales, and scheduling tasks to help maximize your growth and keep customer satisfaction at an all-time high. After all, your customers need to come first. See how Nexa can help you ensure that they do.