Trying to calculate the outsourcing costs for your call center needs?
In recent years, several companies outsource their call center needs to third-party service providers to save costs and boost productivity.
In this article, we’ll cover the average outsourced call center pricing across various regions worldwide. We’ll talk about the different types of outsourced call centers and cover why they are more cost-effective than their in-house counterparts.
This article contains:
(Click on a link below to jump to a specific section)
- The Two Types Of Call Centers
- The Three Options For Call Center Outsourcing
- Average Outsourced Call Center Pricing (by region and type of services)
- Why Is Outsourced Call Center Pricing Cheaper?
Let’s jump right in.
The two types of call centers
To calculate your outsourcing costs, you need to determine what kind of call center services you need.
Each kind of call center service requires different tools and levels of expertise, which can impact outsourcing costs.
What are the kinds of call centers?
Call centers are broadly categorized into two different types: inbound and outbound call centers.
Here’s a closer look at the services each of these provide:
1. Inbound call centers
Inbound call centers mainly deal with incoming calls, although they may make some outgoing ones as well.
Common inbound call center services include:
- Customer support or customer care.
- Answering services.
- IT and technical support.
- Order taking services.
Inbound call center agents are better trained to provide support and resolve queries as their roles center around answering a customer that approaches them. The customer is in charge of the conversation and requires agents like customer service representatives to respond to the best of their abilities.
2. Outbound call centers
In contrast to inbound call centers, outbound call centers focus more on outgoing calls.
Here, outbound call center agents are the ones approaching the customer. They’re better trained to be direct and persuasive as they need to attract the customer’s time and attention.
Some outbound call center services include:
- Lead generation
- Mail follow-up
- Appointment setting
Note: Both inbound and outbound call centers usually make both kinds of calls — it’s the incoming vs outgoing call volume ratio that determines what kind of call center they are.
Generally, if more than 50% of calls taken by the call center agents are incoming, it’s considered an inbound call center (and vice versa).
The three best options for call center outsourcing
When it comes to outsourced call centers, you have several options that differ by price, service and various other factors.
With inbound call centers, you need to choose between shared or dedicated call centers. With outbound call centers, you’re mostly limited to dedicated centers that can be priced on a per hour basis, by performance, or a hybrid version of the two.
Here’s an overview of it all:
1. Shared Vs. dedicated call centers
Best suited for small businesses, shared call centers usually deal with inbound calls. Here, the call center agents take incoming calls from dozens of clients at a time.
- Low-cost alternative compared to dedicated options.
- Pricing is per minute, so you only pay for the time spent on your business’ calls.
- Ideal for unpredictable call volumes or excess workload.
- As agents deal with multiple clients, the call center can only perform easier tasks.
- Agents may not provide optimal customer experience as they’re juggling customers from multiple clients.
As the name suggests, these involve a team of dedicated agents for your business. Outbound services are usually dedicated call centers, but many inbound call centers can be dedicated as well.
- Dedicated agents can be trained to fulfill complex needs, boosting customer satisfaction.
- Effective for up-selling and cross-selling services.
- Ideal for predictable or steady call volumes.
- Usually costlier than shared call center services.
- Requires a larger investment of time and effort to familiarize the outsourced team with your business.
A. Onshore (domestic) outsourcing
Onshore outsourcing refers to outsourcing services to third-party companies within the same country.
- No language or cultural barriers to communication.
- Increased control and interaction with the outsourced service.
- Higher costs compared to offshore outsourcing.
B. Offshore outsourcing
Offshore outsourcing (or offshoring) refers to outsourced services from an international company. This includes outsourcing to a neighboring country (also called nearshore outsourcing) as well as outsourcing to a country on the other side of the world.
- Cheaper due to lower costs of living and favorable currency exchange.
- Can provide call center services 24/7 across time zones.
- Cultural or language barriers may arise.
- Lack of control and interaction with your outsourced team.
3. Hourly, pay per performance or hybrid
These are three call center payment models that usually apply to outbound call centers.
It’s the most common payment structure for outsourced call centers. Pricing can vary massively between countries/regions as per average wages.
- Predictable, stable pricing rates.
- You only need to pay for the productive time spent on your business needs.
- Without incentivizing performance, agents may not perform to the best of their abilities.
- Difficult to track whether you’re being billed for unproductive/idle hours.
B. Pay per performance
This isn’t a very common payment model due to the additional risks taken by the call center. As their pay is directly tied to performance and performance can be variable, they run the risk of not receiving a stable income.
- Pay only for the actual results the call center provides.
- Incentivizes optimal performance from agents, leading to better work quality.
- Unpredictable and unstable pricing.
- Needs larger investments in the form of training and time.
C. Hybrid: Hourly + pay per performance
For many businesses, hybrid payment models are the ideal way to go. This involves a base hourly rate, with an additional performance-based incentive.
- Provides the call center with a stable income, increasing trust between both parties.
- Gives call center agents an incentive to perform optimally for your business.
- Can become slightly costly due to the dual payment conditions.
Average outsourced call center pricing
Now that you know the various types of call center services you can choose from, let’s take a closer look at the average outsourced call center pricing by region.
|Outsourced Call Center Pricing (per hour)
|The United States/Canada
The table shows how outsourcing call center services to an offshore destination can help you cut huge costs. Of course, it’s worth noting where you outsource to as each offshore region’s average outsourced call center pricing varies greatly.
However, apart from the region, there are several other factors that determine the pricing of call center outsourcing. That’s why two different outsourced call center operations will almost never have the same prices.
For example, here are the average pricing quotes from Syrow:
Inbound call centers
- Low-cost offshore prices: $0.27–0.45/minute
- US/Canada prices: $0.75–1.25/minute
- Low-cost offshore prices: $8–15/hour
- US/Canada prices: $20–30/hour
Outbound call centers
- India: $6–10/hour
- Western countries: $20–30/hour
- Specialized, high-level agencies in Western countries: $35–50/hour
- 10–20% premium over normal hourly rates
On the other hand, WOW24-7 mentions an average of $1/minute for outsourced call center pricing. According to them, the average minimum pricing starts at $1,500/month but can increase to $7,500–8,000/month for multiple channels and multilingual support.
So why does call center pricing vary so much even within the same regions or services?
Remember, there’s a variety of other factors that play a role in deciding your outsourced call center costs.
Here’s a quick look at some of these:
1. Call volume
Call volume simply refers to the number of calls your call center makes or receives.
Besides increasing the amount of work, call volume affects several other factors that can determine the final contact center pricing:
- The number of call center agents needed on your team.
- Technology and infrastructure required to manage the number of calls you need.
2. Services required
What needs do you expect your call center agents to fulfill?
Low-cost, simple call center services usually involve a script or a few fixed actions to guide the agent. It doesn’t require specialized knowledge of your niche or product, or any critical thinking or problem-solving skills.
However, services like successful lead generation or product upselling usually require a dedicated and specialized team of agents. These would cost more than a simple call forwarding or appointment booking service.
Why is outsourced call center pricing cheaper?
While outsourced call center pricing can vary greatly between different service providers, it’s still much more affordable than employing an in-house call center team.
Here’s a closer look at why:
1. No infrastructure or software costs
One of the immediate benefits of outsourcing call center work is that you don’t need to bear any infrastructural costs for your call center operations.
To set up a traditional in-house call center, you’d have to pay for:
- Real-estate/office space rent, electricity and other basic resources.
- Computers, telephones and other hardware.
- Software for call management, recording, routing as well as CRM and monitoring platforms.
- Maintenance and tech support.
However, with an outsourced call center, you don’t have to worry about any of these costs!
Professional outsourced call centers would already have all the necessary equipment to fulfill your call center needs.
Additionally, if you’re outsourcing to a foreign destination, like the Philippines, expenses like rent and electricity are much lower as well. Most outsourcing services bear these costs themselves, helping you save costs.
Moreover, these services regularly maintain and update their technology to the latest versions. This allows you to benefit from advanced tools without the cost.
2. Only pay for productive time
This is the most significant difference between in-house call center and outsourced call center costs.
In-house teams need to be paid for all the time spent at the workspace — regardless of whether they’re actually working or not. So apart from paying for their productive time, you’re also paying for lunch breaks, coffee runs or simply, time spent chatting with coworkers!
Considering that the average employee only spends around 12.5 productive hours per week – which adds up to a lot of unproductive time that you’re paying for.
In contrast, most outsourced call center services are usually priced based on productive time. You only pay for the time they actually spent on work-related tasks.
This way, an outsourced team can save you loads while maximizing your call center productivity.
3. Save on training costs and time
Most in-house call center teams need to be trained from scratch to complete their tasks efficiently. While this training further increases your business expenses, it also leads to a lengthy setup time before your call center can be up and running.
Luckily, this isn’t the case with outsourced call center teams!
Outsourced call center agents are experienced professionals in their niche, having worked with several clients before you. Not only do they require minimal training compared to an in-house team, but they’re also likely to be much more efficient at their work from the get-go.
All you need to do is familiarize your outsourced agents with your business, products/services and current requirements. They’ll easily handle the rest.
4. Favorable currency exchange and lower costs of living
By outsourcing to an offshore destination, you save on salary costs without compromising on quality work.
In popular offshore outsourcing destinations such as India and the Philippines, it costs far less to live a comfortable lifestyle than in Western countries, like the USA. As a result, the average salary in India and the Philippines is almost four times lower than in the USA.
How does this help you?
With a favorable currency exchange on your side, hiring experienced call center professionals in offshore destinations costs lower than hiring an entry-level call center agent domestically.
5. Liability protection
Outsourcing companies can shelter you from liability in a wide range of situations.
From restructuring and natural disasters to security breaches or data protection standards, most outsourcing companies take responsibility for several situations. So you don’t have to invest in protecting yourself from such possibilities or pay the respective dues.
However, remember to carefully go over the protections you receive as part of your outsourcing service before finalizing one. This ensures that you’re aware of the situations where your business is liable and can prepare for the same.
Now that you’ve understood the different kinds of outsourced call center services available, you can easily determine the service you need according to your business requirements.
The pricing of your outsourced call center services depends entirely upon your needs and requirements. So make sure you keep these in mind while selecting the right service provider for your business. Once you do, you’ll have no trouble finding the perfect fit for your needs!
Andy is a technology & marketing leader who has delivered award-winning and world-first experiences.