Does an Answering Service Cost More Than a Receptionist?

Efficiently running a business is a top priority for every business owner in today’s economy. Companies of all sizes must ensure that their customers receive professional, quality service, without missing phone calls, while simultaneously protecting their profitability.

In this article, we will take a closer look at answering service pricing to see which one makes the most financial sense for your business. One key area that is often debated among business owners is how to handle incoming calls. There are two popular options for answering phone calls: using a professional answering service or hiring an in-house receptionist.

Average Answering Service Pricing

Phone answering services, aka virtual receptionist services, have been around for many years and are a popular choice among small businesses. They are a form of remote telephone answering service, which means that inbound calls are answered by live operators who are based off-site. In addition to answering calls, live answering services can do a lot for your business, such as capturing leads, taking messages, scheduling appointments, and more. 

The average AnswerHero customer uses between 250 and 500 call answering service minutes per month which costs between $249 and $449. This represents, at an average call duration of 1.5 minutes, between 166 and 333 calls per month. Or, put another way, between 8 and 17 calls per day. This typically covers the number of business phone calls many small companies receive on a daily basis. Plus, answering service pricing is limited only to the monthly minutes you use. You don’t have to pay or worry about things like insurance, worker’s comp, 401k, payroll taxes, and night differentials.

Average Cost of a Full-Time Receptionist

According to Salary.com, the median salary for an in-house receptionist in the United States in 2021 is $37,850 per year or $18.20 per hour before taxes, insurance, benefits, and overhead – which is going to be well north of $20 per hour when all additional costs are included. This excludes the expenses for recruiting, screening, hiring, and training a new employee. 

Businesses must also absorb the risk of employee turnover, which is notoriously high in the customer service industry. In fact, according to shrm.org (or Society for Human Resource Management), turnover, directly and indirectly, costs a business approximately 1/3 of the employee’s annual salary.

Additionally, if you receive a high call volume or your business is open 24 hours a day, you will need to hire multiple full-time equivalent (FTE) employees to cover all the shifts – which can quickly become cost-prohibitive, especially for small businesses. In today’s labor market with a constant drumbeat of news stories about inflation and wage increases, this is one place where the average small business can save money while still providing excellent customer service to their clients.

Hidden Costs and Hidden Savings

There are several other factors and considerations that come into play when deciding when comparing answering service pricing and the cost to hire an in-house receptionist. Here is a quick overview of some of the hidden costs and potential savings associated with each option:

A full-time receptionist can cost your business money by: 

• Being unable to answer the phone 24/7/365
• Require up to two weeks of training 
• Taking up to two weeks of paid vacation per year, where they will not be answering your phone 
• May not always have positive interactions with your clients 

 An answering service can save your business money by: 

• Being available 24/7/365 so you’ll never miss off-hours calls
• Being ready on your very first day to answer your calls in a polite, professional, and timely manner 
• Being available after-hours, on weekends, and during holidays 
• Are experienced customer service professionals who receive extensive and ongoing training

Phone Answering Service vs. In-House Receptionist: The Final Verdict

As you can see, there is a big difference in the average cost of hiring an in-house receptionist and answering service pricing. When you factor in all the additional costs associated with keeping a full-time receptionist, it quickly becomes clear that an answering service is a more cost-effective solution, especially for small to medium-sized businesses.

At its simplest, hiring a fully bilingual answering service like AnswerHero only costs between $249 and $449 a month on average, while having an in-house receptionist costs about $3,154 monthly. And, when you factor in things like benefits, paid time off, worker’s compensation, payroll taxes, and the cost of recruiting and training new employees, the cost difference becomes even more pronounced.

The cost of a full-time receptionist equates to more than 3,800 minutes (approx. 65 hours of phone time) of AnswerHero’s professional answering service.

Maximize Your Savings Without Sacrificing the Quality of Your Service

Customer service plays a critical part in the long-term success of any business. You can’t afford to cut corners when it comes to providing exceptional service to your clients. At the same time, you don’t want to break the bank by spending more on customer service than necessary.

The good news is, you don’t have to choose between quality and cost-savings. AnswerHero can provide your business with the best of both worlds – high-quality, professional answering services at rates that won’t break your budget.