Outsourcing your call center comes with a lot of benefits. But, does it come with a lot of costs too? This call center pricing guide can help you figure out what it might cost and how you should budget.
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Gain an accurate glimpse into the world of customer service pricing, so you know what to expect when you hire your own outsourced contact center.
Call Center Pricing Breakdown
It&#;s important to note that every call center charges for its services individually. The location, seat number, certification, and expertise of your call center can significantly change the price.
Usually, call center pricing is customized to your business. So, the quote you receive is a lot more accurate.
Before we give you actual numbers, it&#;s important to understand how a call center prices its services.
One-Off Costs
When you first start working with a new call center, you&#;re probably going to encounter on-off fees. While it&#;s much more common to have one-off fees at the setup, depending on your requests, these may repeat occasionally.
Common on-off fees call centers charge can be:
: When you start your relationship with a new call center, you&#;ll usually encounter a setup fee. This covers the software and hardware the call center needs to acquire before they begin working for you.
: How many agents you need can vary depending on season. And just like any job, there&#;s always turnover at a call center. Training fees cover the education of new hires. Although, it&#;s important to note that good call centers won&#;t charge you a training fee for general turnover. They&#;ll only charge you this fee is you request more agents than usual.
Ongoing Rates
Ongoing rates are the most important rates when you get your pricing breakdown. This is what you&#;ll be charged regularly.
Generally, there are two types of ongoing rates:
: You&#;ll be charged based on the exact time.
: You&#;ll be charged a set amount, which usually ties to a KPI. Whether that&#;s time, sales, or something else depends on your agreement with the call center.
What the Call Center Pricing Covers
Once you know what kind of fees you should expect, you should also know what this fee typically covers. Of course, every call center offers different things. And your customized offer needs to reflect your preferences too.
That&#;s why your contract with the call center should be your first resource if you want to know what your pricing covers.
However, these are generally what you should expect an outsourced call center to provide.
Advanced telephony platform
All telephony minutes
Realtime and daily recap Reporting
QA Processes
Client support
Middle management
Monitoring Capabilities
Workstation (computer, headsets&#;)
Workforce management
Voice, chat, support
Dedicated agents
What You Shouldn&#;t Pay for at an Outsourced Call Center
If your outsourced call center charges you fairly, you should never pay for:
: Unless you want your own dedicated managers for smaller teams, you shouldn&#;t pay for supervisors or managers.
: A call center should always have a representative you can reach that&#;s dedicated to your relationship.
: While a training fee is standard when you start out and when you specifically requests more agent support, but natural turnover and training costs should never be your burden.
Average Call Center Prices
Now, for the part that you truly came here for. The call center pricing guide.
We should note once again that every call center prices their services differently, so take these numbers as guidance only.
The type of call center and its location are the two most important factors in this guide.
There are two types of call centers:
: Where customers call in for support, and cross-sell or upsell opportunities both arise.
: Where call centers reach out to customers directly.
And for the location, we make a difference between:
: Mexico and Eastern Europe
: Asia (india, Pakistan, Philippine)
Inbound Call Center Pricing
USA-based
Dedicated US-based call centers usually charge $26-$30/hour for their basic services.
However, if you&#;re looking for specific skills, such as tier 2 tech, licensed insurance agents, or registered nurses, you should expect to pay $30-50/hour at least.
Some call centers charge by the minute based on occupancy. This will generally come out to $0.59-0.75/minute with an average occupancy of 75% (which means associates in a billable state 45 minutes out of every hour). If you take $0.59 * 45 minutes = $26.55. That is how you get the per hour charge.
Nearshore
Nearshore inbound marketing services range anywhere from $14-$20/hour depending on the country you are looking to outsource to.
Offshore
If you want to learn more, please visit our website Cloud Call Center.
Offshore contact centers a bit harder to gauge because all countries have different averages.
You can pay as low as $6-9/hour for centers in India or Pakistan, but the going rate is usually $10-12/hour.
While this may be a lot cheaper than US-based call center pricing, but remember, you&#;re sacrificing quality, language, and cultural familiarity for price. These are things that may alienate your customers, seeing as call centers are a representation of your business.
Outbound Call Center Pricing
USA-based
Pricing for inbound and outbound call center services in the States is very similar due to efficiency for multi-skilled agents.
USA rates are anywhere from $26-$28/hour for standard outbound programs. This includes sales, follow up, appointment generation, and service calls.
Any advanced skill programs can run from $30-$50/hour.
Nearshore
Call centers in Eastern Europe and Latin America are in the $9-$16/hour range.
Offshore
In general, you&#;ll find agencies in India and the Philippines normally charge from $5-$12/hour/agent.
Use a Call Center Pricing Calculator
While this guide can give you an accurate depiction of the global pricing ranges for both inbound and outbound call centers, it&#;s important to note that every call center&#;s different.
And every call center will price their services differently based on your business. So, the safest way to know how much a call center will charge is to reach out to them for a quote.
Here, at Expivia, we pride ourselves on the quality USA-based call center services we provide.
We&#;re always happy to partner with new businesses, so feel free to reach out ot us for a quote!
The challenges inherent to calculating the total costs of running an internal contact center are numerous. Both direct costs and indirect costs can be difficult to identify, isolate and quantify, which can lead to an understatement of true contact center operations costs. In this article, we will build an illustrative model to identify each of the various elements that comprise the accurate calculation of call center operations costs. The true cost of operating an internal contact center is typically more than double the hourly wage being paid to your Contact Center Representative.
The largest element of contact center cost is the cost of compensating Contact Center Representatives (CCR&#;s). An average wage for a CCR of $15.00 per hour.
Additional employee-related costs include benefits that an employer pays such as health care, dental care, life and disability insurances. These &#;benefit&#; costs are usually expressed as a percentage of the hourly or weekly wage, and typically run between 20 to 30% of the hourly wage. These benefits may include:
Calculation: RDI uses a conservative approach and factors the lowest average benefits cost at 23% of the base wage.
This incremental benefits cost is estimated to be $3.45.
A direct cost of the contact center is the cost of contact center representative (CCR) supervision. The ratio of supervisors to CCR varies widely but usually falls within the 1:15 range. We made the conservative assumption that a typical company pays its supervisors an average of 25% more than its CCRs (plus benefits).
Calculation: Supervisor paid 25% more than rep = $23.06 per hour/15 reps per team=$1.54.
The incremental cost of supervision is $1.54
Shrinkage is a contact center term reflecting the difference between payroll hours and hours that a CCR is logged in available to work. This represents the difference between the 40 hour payroll week less the time that is used for breaks, training, and paid time off (sick pay, holiday pay, and paid vacation days). Shrinkage represents the time the CCR is not logged into the company&#;s systems and available to do work.
Industry shrinkage numbers can range from 15 to 40%. Obviously, these numbers can vary widely as unscheduled events and fluctuating call volumes impact activities. We have estimated a middle of the road shrinkage factor of 20%. This means that full-time employees are available for customer interaction 32 hours (40 FT hours X 80%) each week. This translates to 1,664 hours per year any CCR is available to work out of total paid hours of 2,080 hours.
The incremental cost of shrinkage is calculated to be $4.00
Utilization is the difference between available-to-work time and actual time spent working. Utilization is primarily driven by:
Outsource companies like RDI have the advantage of workforce management staff and software, forecasting expertise, real-time support staff, and related infrastructure to drive productivity, resulting in 10% or greater utilization than with in-house centers.
Calculation: The basic rule with utilization is, the higher the service level objective the lower the utilization. Industry-standard benchmarks for utilization are typically 65-80%. Of the 1,664 annual hours that an agent is available to work, the agent will actually be on calls/processing a transaction 1,165 hours if achieving a 70% utilization.
The incremental cost of internal utilization vs outsourced utilization is calculated at 10% or $2.00 more per hour for an in-house center (Assumes 10% more hours required at a fully loaded cost of $19.99 per hour).
A direct cost of operating the contact center is initial CCR training and ongoing CCR development. Contact center industry support costs for Training, Quality Assurance, and Coaching vary widely.
Based on RDI&#;s understanding of industry average training requirements, frequency, and complexity, we use a conservative figure of one person/full-time equivalent, to support all Training/QA needs for up to 100 agents.
Calculation: Assumes one FTE per 100 CCR&#;s for Training/QA. Training/QA earn 25% more than CCR = $23.06 per hour/100 CCR&#;s.
The incremental cost of CCR training is estimated to be $.23 per hour.
A major advantage of outsourcing either part or all of contact center activity is to eliminate or reduce attrition expenses, which is one of the largest cost variables in the contact center equation.
Attrition rates are defined as the average number of terminations (voluntary and involuntary) divided by the average number of employees over a period of time, which is usually 12 months. Attrition rates vary widely among call centers. Annual attrition rates can be as low as 20% and as high as 100% +, even when measured after the first 120 days of employment. High attrition rates result from a number of functions having to do with the nature of the position, which is usually entry or near-entry level. These include the wage paid, training, company culture, work schedule, and working environment.
There are many studies showing the true costs of attrition are higher than just the employee wages. For higher-level managerial positions, turnover costs are estimated to be as much as four times the annual salary, including re-hire and re-training plus lost productivity. Lower paid positions are generally less costly.
Calculation: 25% additional cost burden due to 25% attrition with a base cost of $23.06. $23.06 *25%=$5.00
The incremental attrition cost in this scenario is $5.00 /hour.
Facilities: Facility cost consists of direct space used by the agents, Triple Net Charges (NNN) (Insurance, Tax, &#;common space&#; space that is shared in the facility), and utilities costs.
Calculation: At a cost of $17 per square foot for base rent, NNN $10, utility $5 =$32 per square foot per employee* 72 square feet per employee=$2,304 annual cost for Facilities per person / 2,080 payroll hours per year=$1.11 per hour cost per person/work station.
Incremental Facilities cost in this scenario is calculated at $1.11 per hour.
Costs associated with overhead include Equipment and indirect Management Costs.
Management Support: Every position or function in the company is supported by allocated fixed costs that come back to the contact center. These costs include: Human Resources, Executive Management, Finance, Payroll, Workforce Management, Legal, IT, and more.
Calculation: Equipment: Assumes 1,000 employees and $1MM in annual costs (licenses, telecommunication usage costs, hardware and software purchases)=$1,000 per employee/2,080 hours per employee= $.48 per payroll hour incremental cost due to Equipment..Management Cost:estimated $2MM in Management Support for 1,000 employees. =$2,000 per employee/2,080 payroll hours=$.96 per hour of incremental cost.
The incremental &#;Overhead&#; cost in this scenario is calculated at $1.44 per hour.
When we incorporate all of the factors listed above, the real hourly cost of operating an average corporate contact center (using the above estimates) comes out to be over 2x the wage rate paid to the company&#;s CCR&#;s (based on a wage of $10.00 per hour).
Cost Item Incremental Cost % Increase Cumulative Per Hour Notes CCR Wage/Hour $15.00 Benefits $3.45 23% $18.45 See Document for cost drivers Supervision $1.54 10% $19.99 Supervisor paid 25% more than rep = $23.06 per hour/15 reps per team=$1.54 Shrinkage $4.00 27% $23.99 Assumes fully loaded cost of $19.99 per hour * 20% =$4.00 Utilization $2.00 13% $25.98 10% of $19.99 (fully loaded agent rate) Training/QA $0.23 2% $26.21 Assumes one FTE per 100 CCR&#;s for Training/QA. Training/QA earn 25% more than CCR = $23.06 per hour/100 CCR&#;s Attrition $5.00 33% $31.21 25% additional cost burden due to 25% attrition with a base cost of $23.06. $23.06 *25%=$5.00 Facilities $1.11 7% $32.32 At a cost of $17 per square foot for base rent, NNN $10, utility $5 =$32 per square foot per employee* 72 square feet per employee=$2,304 annual cost for Facilities per person / 2,080 payroll hours per year=$1.11 per hour cost per person/work station. Overhead (Equipment and Management) $1.44 10% $33.76 Equipment: Assumes 1,000 employees and $1MM in annual costs (licenses, telecommunication usage costs, hardware and software purchases)=$1,000 per employee/2,080 hours per employee= $.48 per payroll hour incremental cost due to Equipment..Management Cost:estimated $2MM in Management Support for 1,000 employees. =$2,000 per employee/2,080 payroll hours=$.96 per hour of incremental cost. Total $33.76 225%
The above costs represent &#;hard costs&#; and these numbers do not express the qualitative impact to your business resulting from sub optimizing your contact center and related customer experience.
One of the most important reasons to outsource contact center support is to enable your business to stay focused on and maximize the effectiveness of your core competencies. Partner with RDI Connect and take advantage of our core competency: providing world-class service to your most important asset&#;your customers.
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