Call Center Cost Breakdown: What Are You Paying For?

The first step for every business in need of a call center is to decide whether to have an in-house team or to outsource it. And an important the factor to check before landing on a decision is the call center cost breakdown.

A huge percent of the decision will be based on what is more cost-efficient. It requires you to calculate the costs that will clearly show the direct comparison between the two options. It is evident that outsourcing is typically cheaper when you consider everything you need to know about call center outsourcing. Let’s look at the call center cost breakdown which includes the cost of labor, call volume, average handling time, and many more. 

Call Centers Are Essentials

Based on eConsultancy, 61% of the customers nowadays still prefer a phone answering service with a call center agent even if there are other channels for call center support. Next would be the delayed response emails with 60% and live chat support with 57%.

On the other hand, if such a traditional phone conversation is not possible, 69% of customers would still consider online phone calls. This proves that customers still prefer to interact through calls regardless if companies offer omnichannel call center services. In addition, the fact that 72% of customer service is done through call centers shows its significance in different areas of business.

Call Center Cost Breakdown Inclusions

The call center cost breakdown is computed based on many factors. Some of these are but not limited to the following:

Number of Seats

This is one of the most vital factors in the cost of a call center. By determining the number of seats required, you can also identify how many agents, equipment, and other materials are needed.

Expertise of Agents

Like in any other field, the more experienced and skilled the person is, the higher the rate will be. But no matter if the agent is new or has been in the field for years, they will all undergo thorough training.

Current Labor Market Rate

The labor rate changes from time to time as there are movements in supply and demand. If there is a high demand for agents and the supply is low, expect higher rates. If the supply is high and the demand is low, the rates will be lower as well.

Length of Contract

Unexpected it may seem but the length of the contract also affects the price. There is a possibility to get a more competitive price for longer contracts.

Call Volume

The volume of calls that needs to be handled will also alter the price as it will affect the number of agents needed and other factors.

The average handling time is also a factor as well as the add-ons and many more. These will depend on the demand of the client. If they want a specific process to be added to the service they need, the price will change. 

If you would ask some businesses if the total cost is a great deal, it is guaranteed that they will say it’s all worth it. Some of the main reasons why are:

• You can save a lot as outsourced costs are evidently much cheaper.

• You can get access to an exceptional and properly trained workforce with quality assurance.

• Get access to good business infrastructure, which includes the cloud-based processes, for more effective business operations.

• Experience hassle-free operations. Service providers will be the ones taking charge of everything. It includes office supplies, equipment, healthcare, and overhead cost.

The clients need to be aware that there is a different call center cost breakdown per pricing structure per campaign. Each campaign has its specific cost breakdown, which is why it is best to talk to the person in charge of a call center to get a quote. 

Call Center Cost Breakdown Specific to Inbound Services

The cost of call center outsourcing consists of a lot of important factors. Let’s check out some of the differences between shared, dedicated, and monthly inbound call center service pricing models.

Number of Clients

Here, it depends on the number of clients an agent is servicing. When the agent answers call for one to three dozens clients, it is called “Shared”. When a dedicated team exclusively handles calls for only one client, it is “Dedicated”, while “Monthly” is basically a part of the Dedicated Inbound that has a different way of computing the rate.

Rates and Type of Payment 

In Shared, the clients only pay for the time used on a per-minute basis, between $.35-$.45 per minute at low-cost international agencies and $.75-$.90 per minute for those in the US and Canada. For Dedicated, it is priced based on the number of hours with rates around $8-$15 internationally to $22-$28 in the US and Canada. And Monthly, on the title itself, is priced at a monthly rate. 

Which is Fit for Your Business

The Shared kind of inbound call center pricing is perfect for large volume of low activities. The Dedicated type is perfect for businesses that have predictable volumes. And for Monthly, many call centers globally offer this pricing model except for North America and Europe.

Cost Breakdown Specific to Outbound Services

Here are the general guidelines for the differences between hourly, pay per performance, and hourly + pay per performance outbound call center service pricing models.

Which is Preferred by Businesses

Hourly kind of outbound pricing model is considered to be the most common, specifically to lead generation and appointment setting. The second type is Pay Per Performance which is not the most ideal for many outbound call centers. Get your detailed report of sales, appointment conversion rates, script, training materials, and sample recording if you want a provider to consider. The third type is one of the favorites, which is Hourly + Pay Per Performance. This combo of this pricing structure is beneficial for both clients and service providers as it helps maximize the performance. 

Rates

In addition to the program size, difficulty, and contract length, the rates in the Hourly outbound pricing model vary greatly with the location of the provider. In India and the Philippines, the rates range from $6-$10 per hour while $9-$14 per hour in  Eastern Europe and Latin America. And in Western countries, they commonly charge $22-$32.

The Pay Per Performance type of pricing structure depends on the situation. Here, the client should provide the outsourced call center at least a 10% to 20% premium for the additional risk.

In Hourly + Pay Per Performance, it allows the outsourced call center to gain competitive compensation depending on the performance of the program.

Cost of an Outsourced Call Center per Country

India and the Philippines are both known as the outsourcing industry giants ever since the industry started to thrive. They have a lot in common, including cost-efficient, but productive services, hence the reason why companies prefer to outsource from the two. Although they share many similarities, they still have differences, which is their niche. India is famous in the field of Information Technology while the Philippines is known for its superior customer support services.

The main reason why businesses choose to outsource from these two is because of their cheaper services than those from other countries. The location of the service provider is one of the factors that can greatly affect the price of a call center service. To give you an idea, here’s a sample of the call center cost breakdown comparison by geographic location:

Which Offers the Best Deal: India vs Philippines?

India and the Philippines have been rivals for a long time in the call center industry. But which country certainly offers the best deal? Let’s scrutinize here some parts of each.

Infrastructure

When it comes to infrastructure, the two countries are almost alike. India has a lot of advanced infrastructures that helps make them stay always connected to the world. One the other hand, the Philippines has modern infrastructure, not only in its capital but also in some provinces like Cebu and Iloilo. It is a result of continuous development to keep thriving in the call center industry. The buildings are of high standards and the internet connection is accessible to many areas, especially in major parts of the country.

Labor Cost

Talking about the labor cost in these two nations, India offers a lower salary rate compared to the Philippines. But what goes with it is the shortage of some job positions. The accent may also be an issue to some as it may have a significant impact on your business, but most of them are fluent in the English language. 

The Philippines justifies how much its call centers cost with having good communication skills. Aside from having a high-level English fluency, the accent of people seems natural. Their cultural understanding of those of the West is also a plus, which makes them the top call center country in the world.

The figures shown above are based on research paired with industry knowledge, it is close but not the actual amount as it is confidential.

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