A call center is a centralized office where current and potential customers’ telephone calls are handled. Call centers may be inbound, meaning they receive calls initiated by the customer, usually needing support; or outbound, where agents call customers, usually to sell them products or services.
Companies typically used inbound call centers to offer technical support, handle queries about their products or services, manage customer accounts, receive complaints and even process orders. Besides sales, outbound call centers are used to update/verify database information, conduct surveys, follow-up on clients and provide important other information.
There are three types of call centers:
- An in-house call center, where a company hires, trains and manages its own agents within the organization.
- An outsourced call center, where a company hires a service provider to run the call center and handle all the operations.
- A virtual call center, where agents work from home or different locations from each other and answer calls through the cloud.
In-house vs Outsourced Call Center Costs
An in-house call center can be an expensive way to handle sales and customer support.
For instance, the average salary in the US for a Customer Service Representative is $30,688 plus $4,633 in benefits. Multiply that for four or more, depending on how many people you need on your team. In addition, there’s the Customer Service Manager at $39,694 plus $6,032 of benefits a year.
Here’s a breakdown of some of the potential costs of an in-house team of 4 customer service reps:
- Salaries and Benefits - $141,284
- Customer Service Manager - $45,726
- Hiring costs - $20,645
- Office space - $48,000
- Software and Hardware - $3,600
Total = $259,955 per year
Other costs not included above are training, office supplies, fees and commissions and other team members, such as trainers, analysts and quality assurance coaches. These may add up to an additional $200K per year.
What about outsourcing your call center?
Outsourcing costs will depend on many factors such as expected call volume, duration of calls and level of support. Ask yourself, do you need 24/7 availability or only office hours? Multilingual or just English? Just phone or multichannel (email, chat, social media)?
Managed service providers usually offer different packages to meet your needs.
Locally outsourced call center
If you look around the web, you’ll find that call center outsourcing in the US can cost between $25 to $65 per hour for each rep, all else included. If you have 4 reps operating at $30 per hour from 9am to 5pm, Monday to Friday, it would be around $1,680 per week or $349,440 per year.
Off-shore call center
Outsourcing a call center outside the US would bring down the cost per hour per representative. Rates in South America and South Eastern Asia are between $8 and $18.
For instance, one of the reasons CloudTask decided to run operations from Medellin, Colombia, is the availability of local fluent bilingual talent. And because the cost of living is cheaper in Colombia compared to the US, we can offer more competitive salaries than other local employers but still much less than what you would need to pay in California, for example.
A team of 4 CloudTask customer support reps costs $14,000 per month or $168,000 per year, including the support of a Customer Success Manager, Corporate Trainer and Business Analyst. The technology, hiring, training and management are also included.
Outsourcing your call center will save you headaches. You won’t have to deal with payroll taxes, HR paperwork, sick and vacation days, and other associated factors that affect your company’s productivity and bottom line.
Check out how Outsourcing Customer Service saves you time and allows you to reach your goals in this infographic.
Outsourcing a sales (inbound or outbound) call center is also a great alternative for many companies. We’ve estimated the time and cost savings of outsourcing sales services in this infographic.
5 Things to Look Out for When Outsourcing Your Call Center