Businesses are constantly looking for strategies that will improve their bottom line, whether it be investigating potential cryptocurrency investments or looking for ways to streamline their production strategy and supply chain.
Outsourcing has become an increasingly popular option for expense-minded businesses, and as Han Butler, president and co-founder of ROI CX Solutions, explains, this is especially true of call center operations. By outsourcing this customer-facing portion of your business activities, you may be able to significantly improve your bottom line.
Reducing Customer Service Expenses
“Financially, the most obvious reason to outsource your call support is because it is much cheaper than hiring full-time employees to do the work,” Butler says. “As your business grows, you eventually reach the point where you can’t handle customer support yourself. Hiring additional part-time or full-time employees can get expensive very quickly, especially when you need to account for benefits like paid time off and health insurance. On the other hand, outsourcing your customer support means you pay a set fee based on the level of service you need — and that is generally going to be much lower than what you’d pay an employee.”
Indeed, according to ZipRecruiter, the average hourly pay for a customer support representative is $18.80 per hour, though some see wages as high as $26.92 per hour. That results in an average salary of $30,688 per year. That total doesn’t account for other expenses such as hiring and training the employee, providing benefits, and paying for office overhead such as software and equipment. When multiple employees are needed, costs can increase exponentially.
Alternatively, outsourced call support offers a variety of pricing models that allow businesses to adapt according to their needs and budget. This includes pay-per-resolution, pay-per-hour, or a fixed monthly or yearly rate.
While rates can vary based on the call center’s pricing model and the complexity of service a business needs, average monthly rates tend to be much less than what it would cost a business to hire a single customer support employee. These direct savings enable businesses to better manage their cash flow for ongoing expenses or make strategic investments in other areas.
Increasing In-House Productivity
While many business owners focus primarily on the direct cost comparison between outsourcing call support and managing it in-house, Butler notes that many of the financial benefits of outsourcing come from its indirect influence on the business.
“Outsourcing call support enables your existing team to focus on their core areas of responsibility — the tasks that have the biggest impact on your business’s growth and financial prosperity,” he explains. “Instead of getting sidetracked by routine customer interactions, you can focus on improving your products or services and making other strategic moves that can help you increase profitability and efficiency.”
This is especially true for solo founders or startups with a very small team. The ability to focus on your area of expertise, rather than constantly getting distracted by customer support needs, enables you to provide higher-quality work.
Increased productivity and efficiency can have a major financial impact. As McKinsey reports, the top quartile of IT organizations has 10% higher profit margins and 35% higher revenue growth than their competitors — gains largely driven by enhanced productivity. While outsourcing and tech maturity may not drive productivity in the same way, there is no denying the powerful impact improving your team’s efficiency can have on your bottom line.
Improving the Customer Experience
Finally, Butler believes that outsourcing call support can improve a business’s bottom line by directly improving the customer experience. “When a customer calls your company for support, their experience can make all the difference in whether they’ll continue to do business with you in the future,” he explains.
“The quality of support they receive, including how quickly their call is answered and whether their problem is resolved successfully, could either make them a loyal customer for life, or drive them away from your brand and even cause them to leave negative reviews online. With better service quality, you can retain your customers and increase their lifetime value through repeat purchases, positive reviews and more.”
To that end, Butler cites the advanced tools at the disposal of many outsourced call center providers, such as AI-powered call routing and agent support tools, which can make centers and agents more responsive and better able to address customer concerns.
Acquiring a new customer is not only five times more expensive than retaining existing customers. Retained customers tend to provide more predictable revenue, and may even become brand advocates who spur word-of-mouth growth.
Quality customer support makes these outcomes possible, helping businesses simultaneously increase revenue while improving the ROI on marketing expenses.
A Smarter Solution for Your Business Operations and Finances
As Butler’s insights reveal, even though outsourcing call center support might not be the first action that comes to mind when trying to improve business finances, it can still have a very real impact.
In addition to reducing the direct expenses associated with managing this work in-house, outsourcing can also increase your team’s productivity and result in better support that greatly improves customer satisfaction, retention, and lifetime value. In this instance, outsourcing isn’t just about cutting costs — it’s also about increasing your earning potential.
