Business owners have constantly debated about having an in-house call center versus outsourcing a call center. Outsourcing your company’s inbound customer service is a great cost-effective option for many different reasons, whether product support, technical support, or account management.
Having an in-house call center will cost you an average of $16 per hour for each agent you have on the phone. On top of the hourly pay, it will cost an additional $17 per agent when including management, HR, equipment, software, and miscellaneous costs. This brings the average total for an in-house agent to $33 per hour.
If you decide to outsource a call center, you will see a lower cost than an in-house call center. The typical offshore call center agent will cost an average of $5.50 per hour. Adding on the additional cost for infrastructure and operations will add $7 per agent. This brings the average total to $12.50 per hour for each outsourced agent.
Don’t forget about training your new agent, which can cost an average of $1,200 before seeing any results. If you have an agent that catches on fast, this expense could be as low as $500 versus an agent that needs additional support can exceed $2,500.
There are some benefits and drawbacks of having an in-house call center versus outsourcing to an outsourcing company, but they all depend on the company’s needs.
This article will break down the cost of each type of call center and compare the difference.
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In-House Call Call Center Cost
The average cost of an in-house call center agent will range from $10 to $20 base rate for each agent per hour. This base rate does not include management, HR, software, equipment, miscellaneous costs, and training cost. The average with these expenses added on is $33 per hour.
Having an in-house call center does have its benefits. You can train your agents how you see fit, molding them into what’s suitable to your needs. You never have to depend on hiring specific talent because when another opportunity comes along in your company, a current agent may be trainable to take on a new duty.
On the other side of things, an in-house call center can be a costly expense. You will have to pay for entirely new staff and add training time to your already busy list. Not to mention–having an in-house call center brings high turnover rates. With no specialization or added experience, you could see that the average agent time they stay on the job is around three months.
With an in-house call center, you will need a manager that will cost an average of $50,000 per year and another agent to cover for the manager if they are sick or on vacation, which can cost a total of $100,000 per year for both managers.
You will also need someone to manage HR, which can cost between $50,000 to $60,000 per year, depending on the size of your company.
Your business will also need software and equipment to handle inbound calls, faxes, voicemails, and other various tasks, which will cost an average of $15 per agent hour. An inbound call center can be a costly option with benefits, facility, and entire staff.
Outsourced Call Center Cost
When you outsource your call center, it can significantly benefit your company. You will not have to worry about bringing on new agents, training them, or having high turnover rates. Outsourcing a call center agent at the average rate is $5.50 per hour.
The added cost per agent is much less for an outbound call center, which is only $7 per agent hour because of the infrastructure and operations needed.
The average cost of training an outbound agent will run you around $1,200 before using their skills for you. This could be much cheaper if that agent has previous experience or learns quickly. Comparatively, an inexperienced agent may need more hand-holding, which will bring the cost of training close to $2,500.
Depending on what country you want to operate your outbound call center in, the cost will vary. Here are some of the rates for different countries.
- Philippines: $4.50 to $7.00 per agent hour (Cheapest Overall)
- India: $5.50 to $8.75 per agent hour
- Peru: $7.00 to $10.00 per agent hour
- Mexico: $7.75 to $10.75 per agent hour
- Brazil: $8.00 to $11.75 per agent hour
- Argentina: $8.00 to $12.50 per agent hour
- United States: $14.20 $27.00 per agent hour (Most Expensive Overall)
When choosing an outsourcing country, it is essential to understand their proficiency in English, their time zone, and most importantly, the quality of their customer service.
Inbound Call Center Cost
If you need an inbound call center, there are a few things you need to understand. First, inbound call centers have a different workforce than your average outbound center. In an inbound center, the agents typically have more training and schooling behind them because they will be speaking to customers with various issues that may need additional help.
In an inbound call center, you can expect to pay an average of $3.00 per inbound call that an agent handles. This number varies considerably based on the complexity of the call and how long it takes for an agent to handle it.
On average, a company will have around 5 minutes per inbound call. That means that a five-minute inbound call will cost about $3, while a 20-minute call will cost approximately $13.
This price will vary depending on the country your inbound call center is housed in and what you pay each agent. Expect to spend on the low end $1.70 and up to $6 for an average inbound call. This rate is based on a standard call, such as resolving a customer’s issue or setting up a new account.
Outbound Call Center Cost
When it comes to outbound call centers, a company typically needs a manager to oversee the agents. In addition, software can help keep track of tasks that need to get done for each customer on their list.
To have enough time for research and development, you can expect about $2 per hour in software cost. This cost may vary depending on the software you decide to use.
The average cost for each outbound call center dial will be $1.50. This cost can vary from $0.50 to $10 per dial, depending on the support needed to complete the call successfully.
The more resources you give your representatives in an outbound call center, the less the cost per dial will be.
If you are benchmarking your calls, you should expect to pay $2.00 per outbound call to get some results. These results can be as simple as someone answering the phone with proper support to an agent closing a deal.
Benefits of Call Center Outsourcing
While companies often tend to outsource due to lower costs, there are additional benefits.
Save Money
Outsourcing call centers will almost always save companies money. Not only are hourly rates lower, but companies can cut costs on equipment like phones and the internet.
Save Time
If companies operate internal call centers, they have to spend time hiring, training, and monitoring call center employees.
Companies that provide outsourcing services handle all tasks involved with the call center.
More Flexible Schedule
When companies outsource call centers, it’s easier to provide a more flexible call center schedule. For example, outsourcing makes it easier to provide 24/7 customer support.
When companies hire internally, they have to find employees willing to work early and late hours, which can be difficult to do.
Cons of Outsourcing
While there are benefits to outsourcing call centers, there are also drawbacks.
Lower Product Knowledge
Agents at outsourced call centers are less familiar with company products and services than internal employees. Also, since these agents are not located within the company, it’s harder for them to find answers to difficult customer questions.
Agents’ knowledge does depend on the quality of the provided training. Therefore, companies should provide materials that thoroughly explain their products.
Less of a Concern about Customer Satisfaction
Since agents at outsourced call centers are not true company employees, they might have less of a connection with the company they are calling for. Therefore, customer satisfaction may suffer.
Communication Barriers
If companies outsource to call centers in other countries, there may be language barriers. Customers may have trouble understanding the agents due to accents.
When agents are located remotely, communication between the hiring company and the agents can be difficult. If a remote agent has a question, it’s harder for them to reach the company.
Types of Call Center Outsourcing
Call center outsourcing is divided into two main groups: inbound and outbound. Within these groups, there are a number of different pricing models.
Inbound
Inbound centers handle calls from customers. These calls involve placing orders and seeking support.
With shared inbound services, call center agents handle calls from more than one company. Usually, agents are fielding calls for a few dozen companies.
In the shared model, companies are charged per agent minute. These costs range from $0.40 to $0.90 per minute.
Dedicated
Dedicated services devote agents to handle calls from one company. These outsourcing companies typically charge an hourly rate per agent.
These costs range from $8 to $30 per agent per hour. Dedicated call centers are best for companies with a steady, predictable flow of incoming calls since rates are independent of agent talk time.
Monthly
Monthly services charge by the month, rather than by the hour or minute. Some of these services have limits on monthly talk time.
Rates start at $100 per month.
Outbound
Agents at outbound call centers make calls to customers. These calls may involve generating sales, conducting surveys, or other tasks.
Hourly
Hourly call centers charge per hour. These prices vary from $5 to $50 per hour.
Commission
When outbound call centers conduct sales calls, they are often charged based on commission. The commission amount depends on the product or service that the company offers.
However, the commission rate should be higher than an hourly rate, to account for the risk of uncertain payments.
Hourly plus Commission
This pay structure combines the two types listed above. Call centers are paid a low hourly rate along with additional commission payments.
How Centers Charge
The cost of outsourcing call centers depends on a variety of favors. First, it’s important to know how providers calculate the cost of call center outsourcing. Outsourcing providers usually charge by the agent hour. This means that companies are only charged for productive agent time.
If an internal call center employee is on the phone for 75% of their time, and they are paid $25 an hour, their employer pays them $25 per hour. However, with outsourcing companies, the employer only pays for productive time.
Therefore, if the agent is on the phone for 75% of the time, they are only paid 75% of their hourly rate. Outsourcing providers can also charge a flat hourly or monthly rate.
Where is the Company Located?
One of the largest factors in determining call center costs is where the outsourcing company is located. In locations like India, Pakistan, and Indonesia, hourly rates range from $5 to $15 per agent per hour. In Latin America, the Middle East, and Eastern Europe, hourly rates range from $10 to $25 per agent per hour. In the United States, Western Europe, Canada, and Australia, hourly rates range from $20 to $50 per agent per hour.
Agent Knowledge
The more knowledge agents have about the product or service, the higher the call center rates. Call center agents with highly specialized knowledge can cost over $50 per agent per hour.
Conclusion
When it comes to outsourcing a call center, you can expect many benefits for your business. One of the most significant benefits of outsourcing your call center is price. The average cost of an hourly outsourced call agent is $7.00. Compared to a $33 average for in-house call agents, this is a significant saving.
Many countries have great call center managers with brilliant individuals who want to work for you. Outsourcing allows companies to access these professionals at a cheaper rate than hiring in-house.
Outsourcing can also increase your quality of service because you are hiring agents who have experience handling different types of customer service issues. This allows your company to produce a higher-quality level of support for less money.
Another advantage of having an outsourced call center is saving your company time and money on training. Many people think they will need to spend months training agents before handling customer service tasks, but this could not be further from the truth.
Most managers in a call center overseas already have the desired skills and years of experience. They can start working for your company tomorrow with little to no training at all.
If cost is your main concern, outsourcing is probably the best option. If you want more control over the training of your employees and what type of service they are providing to customers, then it might be better to go with in-house customer service representatives. You may be interested in HR outsourcing costs.
