Assuming you’ve read our piece on Organic Expansion vs. Outsourcing Customer Service Team, you’re here because you're the latter. Well, we’re here to show you the True Cost of Outsourcing your Contact Center Team. This will be a helpful little guide to teach you how to navigate the confusing world of outsourcing contracts and agreements!

The cost of your customer service department depends on the type of work of your customer service representatives.

• Social media
• Ecommerce
• Lead generation
• Inbound call center
• Outbound call center
• Customer retention
• Technical support

How Much Am I Paying for Inbound/Outbound Agents?

When you hire an "in-house" customer support team for inbound or outbound call center operations in the United States, you are paying that agent’s hourly rate salary, full benefits and training. However, with an outsourced agent in somewhere like the Philippines, you are only paying for that call center agent's salary and in some cases actual tickets handled.

This is, without a doubt, the best aspect of customer service outsourcing. That being said, outsourcing companies can package their rates in ways that are not always clear surprising unsuspecting businesses.

For example, let’s say you decided to work with a traditional large outsourcer to staff 5 full-time support agents. Here is a sample breakdown of how your costs could add up:  

1. Management Fees ($500 - $2,000): Before you have an agent even pick up a phone for you, you’re going to have to pay a start up fee. This includes your companies background check, as well other clerical set up fees.
2. Service cost per agent ($150 - $400 per month): Some outsourcers will charge you a service fee of $30-80 per agent, per month. This is also regardless of call volume.
3. Other costs that may add to this amount include support channels (e.g., social, chat) and languages such as Spanish.
4. Agent salary ($12,000 - $14,400 per month): Assuming a salary of $13-18/hour and that an agent works 40 hours per week, each agent will cost $2,400 - $2,880. This amount usually does not include overtime during holidays and peak seasons, which can significantly increase your costs.

At the end of the first month working with this outsourcer, you may be paying around  $13,000 - $17,000    

Typical Call Center Outsourcing Costs and Pricing Plans

A simple way to get a gauge on what an outsourcing company may offer you is to expect one of the three options below:

• Shared:
• A pool of agents taking calls for 1-3 clients a day. If you have low call activity, or wild fluctuations that are hard to track, this is your best bet for cost savings.
• Dedicated
• These outsourced customer service agents are there for you and you alone. However, this level of dedication comes with a price hike than a shared plan. That being said, you are usually only paying per productive hour for your call center cost.
• Monthly Flat Rate
• Though it is difficult to find service providers in US/Canada who provide this option for your call center pricing, it does exist. Basically a subset of the dedicated option where instead of paying a company based on their agent’s productive hours, you agree to a flat rate. This can be a double-edged sword, as you may end up paying for non-productive hours, or you may be getting a large number of hours from your team members for free.  

Added Services

Not all Customer Service Outsourcing Companies Provide the same benefits. Some may actually charge you extra for “add-ons” such as:

• Call Recording
• Quality Assurance
• Business Consultation
• Analytical Programs
• Managerial Training

Always review the terms of your agreement with your outsourced call center and see what “add-on services” you may wish to tack on or take off. Sometimes, it’s easier or more cost effective to simply take an “all-in” package than go a la carte. Although, taking the time to custom fit a plan for call center services using modular components may yield a higher return on your investment.

Contracts

In the same vein as the point above, always thoroughly read your outsourced contract. In the case with big companies, leaving your agreement early, or modifying it can come with heavy fees and stiff penalties. Even if you realize your customer service needs have changed, you may be stuck with a service that is either too much or too little for your current operation. Hidden costs, tricky wording, quotas, and minimum charges may end up costing you more than you realize.

Loss of Touch

As we said in our first piece about outsourcing. The biggest cost will always come as a loss of connection to your customers. This might impact your customer satisfaction. Using an outsourcer for your customer experience team is sacrificing a direct line of representation to your customers. Despite that, finding the right customer care team with a plan that fits your company’s needs can do worlds of good for your bottom line. Consider perhaps using a boutique outsourcer rather than a huge player for your small business.