How Much Does it Cost to Outsource a Call Center?

How much does it cost to outsource a call center

Call center outsourcing is often more cost-effective compared to hiring in-house staff. The labor costs alone tend to be significantly less. However, outsourcing also brings increased efficiency and many other advantages that add to the value of outsourcing.

So, how much does it cost to outsource a call center? The answer depends on a variety of criteria, including the size of the call center, the required training, and more. Here is a closer look at call center pricing to help you make an informed choice when selecting a business processing outsourcing (BPO) provider.

What Factors Influence the Cost of Outsourcing a Call Center?

The cost of outsourcing depends largely on:

● Call volume

● Type of call center services

● Location

The call volume refers to the expected number of calls. A higher call volume requires more agents, infrastructure, and technology, which increases the cost. Hiring dozens of employees costs more compared to hiring just a few.

Small call centers tend to have 5 to 10 agents. A medium call center may require 30 to 50 agents. At Digital Minds BPO, we assess your call volume to determine the ideal size, which increases the potential cost savings of outsourcing your call center. You do not pay for agents that you do not need.

Types of Call Center Outsourcing Services

The three main categories of call centers include inbound, outbound, and automated. Each category includes a variety of services that may require different skills, software, and costs.

Inbound call centers are often used to provide customer service. The calls are incoming from customers. Some of the most common inbound call center services include:

  • Answering service
  • Chat support
  • Tech support
  • Order processing
  • Help desk services

 

Outbound call centers involve having the agents call customers or leads. Examples of outbound call center services include:

  • Appointment setting
  • Event registration
  • Market research
  • Telemarketing

 

Outbound call centers tend to cost more due to the skill level and knowledge needed. Call centers that require specialized training may require more experienced staff, which often results in higher hourly rates.

For example, lead generation services tend to cost more compared to answering services, as you require a dedicated, specialized group to successfully generate leads. However, the costs also depend on the pricing structure.

Inbound Call Center Outsourcing Costs

Inbound and outbound call center services often use different pricing structures. With an inbound call center, the services may be priced using one of the following options:

● Shared

● Dedicated

● Monthly

Shared inbound call center services offer the lowest costs, as you pay a per-minute rate. With shared services, you share a team of agents with multiple clients. Your costs are based on the time that agents spend answering your inbound calls instead of an hourly rate, which reduces the total outsourcing cost.

Shared services are ideal for those with limited call volumes. If you do not anticipate a lot of activity, you may not need a dedicated team of agents. Dedicated services provide agents who work exclusively for your business. The call center does not field calls for other clients. Instead of paying a per-minute rate, you pay an hourly rate.

Call centers may also offer monthly pricing or sometimes referred to as FTE or Full Time Employee rate. A monthly pricing plan or FTE is used for dedicated call centers with steady, predictable call volumes. You often save compared to the hourly rate.

Outbound Call Center Outsourcing Costs

Outbound call center services such as lead generation and appointment setting may use one of the following pricing structures:

● Hourly

● Commission

● Hourly and commission

Outbound services are often charged based on an hourly rate. Depending on the region, you may pay anywhere between $5 and $55 per hour for outbound outsourcing.

Some call center proposals may work better with a commission-based pricing structure. A commission structure gives agents more incentive to produce results. However, this may also require a premium over the normal hourly rate to offset the risk of not receiving pay due to not earning any commissions.

You may also arrange a pricing structure that includes an hourly rate plus a commission. Offering an hourly rate and incentive often helps optimize the performance of outbound sales agents.

Call Center Outsourcing Costs

Domestic vs. Offshore Call Centers for Outsourcing

If you live in the United States, Europe, or Australia, you are likely to save on labor cost when outsourcing to another country. These regions tend to have higher hourly rates for outsourcing compared to countries throughout Latin America, Africa, and Asia.

The amount that you save depends on the region where you operate and the location of the outsourced call center. For example, outsourcing to the Philippines may cut labor costs by 70% or more.

What Is the Best Region for Contact Center Outsourcing?

Examine the average pay rate of outsourced labor in different regions to estimate your potential savings. The following figures are based on the average hourly rate for each region:

● United States: $22 to $35

● Australia: $35 to $55

● United Kingdom: $25

● Africa: $15 to $20

● Latin America: $10 to $18

● The Philippines: $6 to $8

● India: $5 to $9

The lowest price does not always offer the best value. When outsourcing to another country, it is important to select a region that aligns with your business requirements.

English-speaking businesses often turn to the Philippines for reliable contact centre solutions. Agents in the Philippines have a natural understanding of the English language and all its nuances.

The demand for dependable call center outsourcing has led to a growing talent pool of qualified customer service agents in the Philippines. There is no shortage of agents available to meet your specific needs, no matter the size of the contact center.

How to Calculate the Value of Outsourcing Call Center Services

Outsourcing keeps you from paying for non-productive agent time, such as breaks and wait time. Costs such as quality assurance, management, infrastructure, and HR support are included in the agent’s hourly rate.

To estimate the value of outsourcing, you first need to define the business function that you are considering outsourcing. For example, you may plan on outsourcing an inbound call center with four representatives.

Next, determine how much it would cost to carry out the same business function using in-house staff. Total the direct costs of hiring labor for an in-house contact center, including salaries, training, supplies, equipment, and office space.

After calculating the potential costs for an in-house call center, work with a reliable outsourcing partner to explore pricing. The quote that you receive for the contract will likely provide considerable savings compared to in-house costs.

Keep in mind that hiring in-house involves different costs compared to outsourcing. For each in-house employee, you need to consider the cost of management, hiring, training, benefits, insurance, and facilities. The general rule is to multiply the base hourly wage of an in-house employee by 2-2.5.

For example, if you pay an agent $14 per hour, your true cost for that employee is likely between $28 and $35 per hour. Compare that to the average hourly rate in the Philippines of $6 to $8.

In this example, the employer saves a minimum of $20 per hour per agent. That equals $800 or more in savings across a 40-hour workweek. In a 10-person call center, the employer would save $8000 or more per week.

Outsourced Call Center Pricing

Why Is Outsourced Call Center Pricing More Affordable?

The cost of outsourcing varies greatly between providers and regions. Yet, outsourcing almost always delivers a more affordable option compared to an in-house contact center. Here are a few of the reasons why outsourcing consistently provides better pricing:

● No infrastructure

● No idle time

● Faster onboarding

● Lower costs of living

Setting up an in-house call center comes with infrastructure costs. You may need to obtain additional office space or real estate. The call center will also require computers, telephone equipment, hardware, and software. You may even need to hire additional technical support to keep the contact center running smoothly.

You also pay in-house staff for idle time. Employees are not productive 100% of the time. One study estimated that the average office worker wastes about 90 minutes of paid time each day. When you outsource, you only pay for productive time instead of paying for employees to chat with coworkers or take long bathroom breaks.

In-house staff often require training to understand their job duties and call center operations. Outsourced teams are already experienced with call center services, resulting in less training and faster onboarding.

Outsourcing to another region may also result in savings due to lower costs of living. The United States, Australia, and Europe have some of the highest living costs, which results in higher pay rates.

Choosing the Right Outsourcing Provider

The outsourcing company that you choose has a large impact on call center pricing. At Digital Minds BPO, we work with our clients to develop solutions that result in the greatest cost savings.

The pricing of your outsourced call center should depend on your specific needs and requirements. Contact the team at Digital Minds BPO to explore the cost benefits of outsourcing your contact center. Hire your own appointment setting, telemarketing, and customer service team at a fraction of the cost. 

Ready to grow your business?

Find out how much our outsourced call center services cost. It usually takes only 1-2 days to receive your proposal.

Once signed, the recruitment of your team will begin immediately.

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