James Kademan is the owner of Calls On Call Extraordinary Answering Service in Madison, Wisconsin as well as the author of The BOLD Business Book. When he isn’t improving the communication of business owners, he is busy guiding entrepreneurs to success in business and beyond. He blogs successfully to the world at www.drawincustomers.com. If you are considering hiring a receptionist or outsourcing your call answering, take a moment to call James at (608)210-3110.
Call Answering: In House or Outsource
Calls On Call offers a great service for growing businesses that you are aware of. But at what point do you move to hire your own office staff? To answer that, we need to do some math and look at some priorities of your business.
The short version:
Outsourcing most things is generally better, more affordable and you end up with a better product or service. That is why we all share things like roads, doctors, accountants, plumbers and insurance. Any one company hiring an exclusive on any of those would typically be cost prohibitive and lead to a worse result.
Ironically, almost all of our clients are themselves outsourced by their clients. So they understand this.
Cost
Calls On Call charges anywhere from a few hundred dollars to a few thousand dollars, depending on how much you use us. The few hundred dollar clients should obviously never consider hiring a fulltime replacement for Calls On Call, since no one can, or will, work for a few dollars per hour.
But once you get to paying a service of any kind more than a few hundred dollars, you may start wondering, what are your options.
A typical office employee goes for anywhere from $10-20 per hour as a base wage. We must start our employees at $13.50 and raise them quickly to keep them. That is typical in our area and even more expensive in many other places. Presuming an employee needs a place to sit, some equipment to use (computer, vehicle, tools, software, phone, etc.) and that employee needs to be hired, fired, met with and trained, there is an additional expense, as any employer is aware. In addition, employees cost money in terms of taxes, insurance, benefits, vacation, etc.
So we typically assign a burden rate of 50% to the hourly rate of any employee. Some industries have that higher, rarely is it much lower. Not if all of the expenses are actually accounted for.
That puts our one $13.50 employee at a minimum cost of $3483 per month.
Let’s also remember that each employee introduces HR and legal issues and liability. Some of which are tough to put a dollar figure on.
Availability
That one employee will not be around to answer every call you have. That is just the way things work. No one can be on two phones at once. Not in any productive manner, at least. So you’ll either need back-up, which means more employees, or you’ll need to outsource your backup, which dampens any claim of efficiency improvements.
Employees don’t typically live to work for you, despite what they may tell you. Why should they? So they’ll want vacation time, sick time and personal time. Guess what happens to that potential customer calling you when your office people are on vacation?
How do you feel when you call a service to get something done and the call is not answered?
Perception
We like to find potential clients by poking around at reviews potential customers have left for our potential clients. Many people get frustrated calling service after service and not getting an answer. So they’ll leave a review that states that they never did work with the company because that company never answered their phone. How many bad reviews does it take for a business owner to realize they have a problem? What is the negative value of each of those reviews?
Some business owners never learn, or care. They are doing well-enough and the general perception of their business by anyone but their clients is of little concern. That, in our opinion, is an extremely short-sighted approach.
We like to go with the opinion that all calls are important, all calls cost us money to come in and therefore all calls deserve to be answered. What good is all of your marketing if the call to action is to leave a message?
Smooth Operator
This one is arguably the most important. I love to see business owners have the people, systems and operations in place to allow them to get things done in an efficient and practically interruption free manner.
Most businesses do not work that way. They react instead of prepare.
When you have your calls and office tasks outsourced, you have a smooth operation. You have less headache, less interruption and more profit. According to my research, those are all good things.
Of course, I am clearly biased.Though keep in mind that Calls On Call was created by me as a solution to a problem my first business was having. So I know what issues businesses face and what challenges clients of these businesses have. I’ve been and continue to be on both sides of the transaction. We can all agree that people just want to be heard and they want their problems solved. Isn’t that what we all do for our clients?
Office Employee vs. Outsourced Office Admin
Sometimes People Fall Into the Valley When Trying to Climb the Mountain
So the other day I had a client for Calls On Call tell me they were leaving us. We didn’t do anything wrong, except for charging them. They were in the process of cutting costs and the discussion essentially detailed that they had some office talent they were paying for that needed something to do and that something was now to include answering their calls.
Now this alone is not unreasonable. We have been a stepping stone for businesses as they startout and grow from not needing office help to needing more than we can provide. The challenge comes in discovering when that change really needs to happen.
This particular client decided that a new office manager CEO type was needed. This is not the typical $15/hour office admin. This was a $70K salaried guy with a lot of ideas and a sales pitch of hope and fear. So our client bit. They hired this clown and now discovered that ideas alone do not make up for a $70K addition to their payroll expenses.
So they decided to cut off their call answering service, their bookkeeper and likely any other outsourced vendor that this $70K Clown admitted to being able to handle. Which in the case of this guy, I would bet for job security he told the business owner he could do it all.
Unfortunately, this $70K Clown is not great at math, and neither is our former client.
The Numbers
We were charging them about $1400 per month to take care of all incoming calls, emails, having a business call and text app on their phones for their crew and a few other odds and ends. We answered anywhere from 225-600 calls per month, depending on the season. This is for a construction company and they certainly have their busy season.
For those of you paying attention, that means that a construction company that built its reputation on excellent communication by outsourcing it was now taking it in-house. If you have ever called on a construction company that “answered’ their calls in-house, you know that means they mostly ignored those calls and returned the VM messages whenever they felt like it, if they felt like it. Which is to say, when they needed the money.
So this company owner was paying his $70K Clown more money for lower quality service.
My downfall in having conversations with business owners that do odd things like this is that I start laughing. I literally giggle when I think of the ridiculous nature of these decisions. That turns off some business owners fro some reason. My wife hates situations like this as well, when I laugh at some of her decisions, that is. That’s a topic for another blog that will never be written.
Anyways, what is interesting is that in the conversation I had with our former client he mentioned that they really don’t need to answer all of their calls.
Say what?!?
Do you hate money?
What do you mean you don’t need to answer all of your calls?
Marketing a Lie
The very next day I saw a review this former client posted on social media from a Mike G. that read, “Contractors generally get a bad rap for being poor communicators, but FORMER CLIENT is an exception.”
Not anymore, Mike.
Now, this former Calls On Call client is welcoming becoming just another contractor that doesn’t answer their phone.
Anyways, to break down the math, Calls On Call, plus a few other outsourced vendors were costing this company roughly $3000 per month. That’s $36,000 per year, all included.
The $70K Clown cost his base $70K, plus his burden rate. Let’s call that 20% to cover FICA, insurance, training, vacations, etc. Then our former client needs to get this $70K Clown a desk, computer, cell phone, software, etc. So let’s call it $90,000 per year.
Now if you take that big $90,000 number and subtract that smaller $36,000 number, you come up with a pretty big difference.
The Truth
That difference comes down to two things, which are very expensive and rarely end up directly on the balance sheet of any business. Those two things are 1) Pride and 2) Fear.
Pride in this case is the fact that our former client has grown. He’s been with us for over eight years. He was a couple man show and grew to be a small army of 10 or so. The pride of business owners having office staff is a tough one for any outsourced admin company to deal with. The dollars speak for themselves, but often pride is what rules the decision.
The next difference I mentioned was fear. This comes down to our former client doing some simple math and discovering that he made a bad decision by hiring this $70K Clown. Which means he should tell his $70K Clown to take a walk. But that is a tough conversation to have. You never want to be the one to tell someone that they aren’t good enough or that they aren’t a good fit. But we as business owners need to get over that fear and have that conversation.
Time will tell how this will all play out. I hope it goes well for this former client. From my experience this will not play out in anyone’s favor, save for the $70K Clown.
Sometimes, you decide to laugh, because it will do no good to cry.
If your business could benefit from getting calls from your customers answered and resolved quickly, efficiently and kindly it would make sense to reach out to Calls On Call. Give us a call at (608)210-3110 or email hello@callsoncall.com.
How Long is a Minute?
How long is a minute?
For Calls On Call, a minute is 60 seconds. But for some other call answering services, a minute can be as little as one second.
What?!? That is crazy math, right?
Not all call answering services measure a minute the same. For example, some charge a minimum amount of time for any interaction.
For example, let’s take that telemarketer that called you recently. It took you about two seconds to realize it was a junk call, right?
Some of our competitors will charge you 30 seconds, some even a full minute or two as a minimum for that call, regardless of length!
That means that one of the ways to compare apples to apples when researching call answering services used to be by checking minutes of time in a package and comparing the price for that package. Now a minute to Calls On Call is actually a minute, but to another company that minute could really be a few seconds of actual usage. Read More
Call Answering for Your Small Business
Life moves fast, so do your clients. When you own your own business, sometimes you don’t want to or can’t take a call. But you don’t want to Read More
Excellent Communication Will Get You Far
Not that long ago, I had a bad employee. He was charming, funny and a good looking person with charisma that was approaching James Bond devilishness. He also happened to be a sociopath.
It took me a while to realize that this employee had some issues. What it taught me was the power of excellent customer service.
You see, this employee sabotaged some customer’s office machines for a different company of mine. He was smart enough to then keep in constant contact with them to let them know that help was on the way…soon. It took me a few weeks to get wind of the underlying problems that were building up.
This isn’t a blog about bad employees. This is a blog about great customer service. This employee, though criminal and negligent and void of all concern for our client’s office machines, was smart enough to care about the client’s feelings. That is why it took weeks to discover the issue. Read More
How to Improve Your Google Reviews
As I was surfing the internet searching for a home improvement company, I came across an odd result. Many area builders do not have the best Google Reviews. Google reviews as well as most other review sites I have always taken with the tiniest of grains of salt. Read More
10 Signs You’re a Dedicated Receptionist
If you’ve ever doubted your excellency, see if you can par 10 for 10 of these signs that you are indeed a dedicated receptionist! Read More
Dedicated Receptionist
Your customers will love the friendly, helpful voice of your dedicated Calls On Call receptionist.
How to be an Outstanding Receptionist
Anyone can be a receptionist, but it takes special kind of personality and breed to be an OUTSTANDING RECEPTIONIST. Becoming an OUTSTANDING RECEPTIONIST takes a lot of hard work and experience which will develop over time. What are the most important skills exactly needed to be an OUTSTANDING RECEPTIONIST? Well let’s below!?
- Exceptional Phone Voice and Manner
Anybody can learn how to the phone, but having a “phone voice” is an unteachable trait. It has something to do with pitch and stressing of syllables and sounding like you genuinely care. Always be polite and respectful to each and every caller. Note accurate and correct caller details repeat telephone numbers if necessary for return calls.
Why Your Cell Phone will Kill Your Business
Do you remember business before cell phones? Not that long ago, it was common to see some business people with HUGE cell phones. They didn’t even call them cell phones. They were bag phones or car phones or Motorolas. Bringing it to the cell phone nomenclature is fairly recent.
Back then not every 12 year old kid had them. Most people did not have them. Many people thought they would come and go like a fad. Many businesses relied on landlines and answering machines just as many businesses relied on brick and mortar stores. Read More