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Weighing In-house vs Outsourcing Customer Service Pros & Cons

Aneto Okonkwo
June 29, 2022
Regardless of the path you choose, investing time into your team and ensuring they feel supported is necessary to provide support to your customers.

Welcome back to Part 2 of our Scaling Support series on how to best scale your customer support team. In Part 1, we discussed the 5 important questions to ask before starting your very own customer support team. We’ll now walk through the pros and cons of outsourcing your customer service team vs. expanding it in-house.

Which one will better suit your business model and ultimate goal?

5 Benefits of Outsourcing Customer Service

1. Saving Money

For some businesses, this is the only thing that matters, let alone simply being a “pro.” According to Deloitte’s Global Outsourcing Survey, 59% of businesses worldwide stated that cost reduction was their primary reason for outsourcing. Businesses in the US make up most of the global share of outsourcing companies coming in at 42%. By outsourcing your call center and customer service agents, you are saving an incredible amount of money on infrastructure, equipment, overhead, and labor.

Some outsourcers have payment plans that are based on call resolution and volume, not by the hour. Meaning, you are only paying for customer service agents when an issue arises rather than sitting at their desk waiting to be useful.

2. More Coverage

Typically, employees expect to have a 40-hour work week, from 9 to 5 PM. However, when you outsource your customer service agents, this restriction goes by the wayside. Outsourcing companies can provide 24/7 service for the fraction of the price. A staggering number of customers will simply hang up and move on if they cannot reach an agent in what they deem to be a satisfactory amount of time. These missed calls can result in the customer abandoning your business altogether. Having 24/7 customer support can allow you to “out-service” your competitors and stand out in your industry.

3. Faster Response Times

It goes without saying, more agents means shorter response times, which is a key factor in excellent customer service. Did you know that almost 65%+ of customers are likely to wait 2 minutes or less on hold until they hang up? Even worse, 1 out of 3 customers who hang up will never call back? Ensuring that extra coverage is a good way to combat this challenge.

4. Serving Multiple Languages

More language options mean you can serve more people easily. This, in turn, broadens your customer base. Instead of having to comb through applicants that are bi, or even trilingual, many outsourcing services can provide this to you. In the same vein, many outsourcing companies have a diverse and up-to-date arsenal of resources your company may be unwilling, or unable to invest in. This can include different helpdesk software, programs, or simply state of the art infrastructure to handle incoming calls.

5. Peace of Mind

You have a lot of things to worry about when running a business. Sometimes being able to delegate just one of those things is a major relief.

Outsourcing companies are built on the basis that they know the ins and outs of customer service. Their training and resources are tailor-made to keep them competitive in their field. Your success is tethered to theirs, giving them the incentive to keep to a standard.

The larger your company gets the more demanding your consumers may become. The demand to have a team of highly trained, skilled customer service agents ready to deal with a myriad of issues in different languages can be daunting. Outsource companies typically handle the hiring, training, and staffing so you don’t have to.

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5 Reasons to Keep Customer Service In-House

1. Losing That Personal Touch

Your company’s brand and strategy may be lost when handled by an outsourcer. By not hiring the customer service agents yourself, or having any input on how the customer service interactions go, you are losing a critical step in ensuring your brand is being represented the way you want it to be. Meaning a more generic outsourced call center can result in your business being lost in the crowd.

2. Maintaining Quality

What your company has defined as excellent, or even satisfactory care may not be what the outsourcing company defines it to be. Seeing a decrease in care may turn away some loyal customers that stayed with you for your customer service in the first place.

Your outsourced agent might be working for many more companies than you. Meaning, their passion can never match the levels a homegrown employee can display. Furthermore, their attention may be divided or spread too thin, causing an overall decrease in performance.

3. Workplace Morale

Your current employees may become upset, or even threatened once you begin using an outsourcing service. They may feel as though they are on the chopping block to being replaced. Having a good company culture is key to productivity and success, and disturbing the flow of that may do more harm than good.

4. Risking Customer Satisfaction

A study conducted by researchers at concluded that outsourcing customer call centers, especially overseas, resulted in massive decreases in overall satisfaction.

Linguistic barriers can hurt your business just as easily as help it. If your outsource partner’s agents are not familiar with certain cultures, idioms or phrases, it can cause frustration to the caller.

Troublesome outsourced employees cannot be dealt with or corrected as easily either. Often times they are unfamiliar with your company culture and values. You have limited to no control over the outsourced employee’s business functions. This could easily result in your company being misrepresented.

5. Contractual Obligations

Many outsourcing companies have very rigid contracts. Often times these contracts are long-term deals and ask for very specific minimum requirements of service and payment. This can really put your company in a bind if you realize you have made a mistake in outsourcing to a particular company, or outsourcing at all. Unlike a troublesome employee who can be fired, the outsourcing company’s contract will keep you in business longer.

Regardless of which path you choose to embark on, investing time into your team and ensuring they feel supported is necessary to provide support to your customers. In the next part of our series, we will discuss what it really means to expand your team organically.

Have any other tips on the best ways to grow an effective customer service team to share? Let us know here!

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