The Philippines has been a major player in the call center outsourcing industry for over a decade. In fact, the country overtook India in 2010 as the largest call center outsourcing destination in the world and has held a stranglehold on voice-based BPO services ever since. An English-fluent workforce and a strong cultural affinity with the US are a couple of the reasons why companies have chosen to outsource their call centers to the Philippines.

For SMEs exploring this path, it’s critical to understand how the costs involved with call center outsourcing in the Philippines impact service quality. Partnering with the right provider will result in increased efficiency, ROI, and customer satisfaction. Choosing the wrong one can result in program failure.

For service buyers trying to understand call center rates, it can be confusing to see a wide range of rates advertised for what seems like pretty much the same service offering. However, delving deeper into the world of call center outsourcing reveals that there are essentially two options: the low-cost, no-frills vendor and the Premium service provider.

For service buyers weighing these two options, it’s important to understand the fundamental difference in how services are priced, and this begins with the hourly rate. A typical premium call center in the Philippines charges around US$14 per hour, whereas a low-cost vendor comes in at approximately US$8 per hour. This may seem like a significant disparity at first glance, but there are other considerations than just the hourly rate. The differences are in fact, quite stark.

For both premium call center vendors and low-cost providers, the operational costs are similar: 30% for labor costs, 15% for management, 10% for support as well as infrastructure and technology, and 5% for bandwidth. 30% remains for the vendor margin. However, after deducting the operating margin from the hourly cost, a buyer can begin to get a clearer understanding of what they’re actually paying for.

A premium provider, once the operating margin is accounted for, has approximately US$9.80 to pay for agent and management salaries, as well as support, technology, infrastructure, and utilities. For a low-cost provider, the after-operating margin is only US$5.60. This is where the distinction between high-quality and low-quality experiences becomes clear. 

A premium call center in the Philippines that charges slightly more on a per-hour basis can afford to pay top dollar for the best agents and managers, who in turn deliver superior customer service. For a low-cost provider, it’s not possible to compete on quality because they must offer their services at rock bottom prices. They are therefore forced to cut corners wherever they can, which usually results in low-quality service across every metric.

This drop-off in quality with a low-cost call center is evident across all areas of service, but most crucially in the quality of the workforce. A premium call center compensates agents twice as much as a low-cost vendor can. The top-performing agents, motivated by this, superior work conditions, training and development opportunities, and management support, naturally seek employment with premium vendors. Better pay and perks also result in less agent turnover at premium call centers in the Philippines, which is important to maintaining consistency in any outsourced program.

The additional revenue generated by premium vendors doesn’t just go towards acquiring the most talented agents. It also helps to improve other aspects of the call center experience, including reinvestments into world-class technology and infrastructure, which help to enhance the customer experience through improved call routing, management, and reporting.

There are many good reasons to invest in partnering with a call center in the Philippines to handle customer service, sales, and support. However, understanding call center rates can be difficult for those who’ve never outsourced call center requirements before. When it comes to comparing rates, it’s crucial to dig deeper into understanding exactly what you’re getting for your money and not just focus on the hourly rate alone. When it comes to outsourcing a call center program to the Philippines, the most important factor is quality.

Call Centers Philippines – You Get What You Pay For 

The Philippines has been a major player in the call center outsourcing industry for over a decade. In fact, the country overtook India in 2010 as the largest call center outsourcing destination in the world and has held a stranglehold on voice-based BPO services ever since. An English-fluent workforce and a strong cultural affinity with the US are a couple of the reasons why companies have chosen to outsource their call center operations in this part of the world. 

For SMEs exploring this path, it’s critical to understand how the costs involved with call center outsourcing in the Philippines impact service quality. Partnering with the right provider will result in increased efficiency, ROI, and customer satisfaction. Choosing the wrong one can result in program failure.

For service buyers trying to understand call center rates, it can be confusing to see a wide range of rates advertised for what seems like pretty much the same service offering. However, delving deeper into the world of call center outsourcing reveals that there are essentially two options: the low-cost, no-frills vendor and the premium service provider.

For service buyers weighing these two options, it’s important to understand the fundamental difference in how services are priced, and this begins with the hourly rate. A typical premium call center in the Philippines charges around US$14 per hour, whereas a low-cost vendor comes in at approximately US$8 per hour. This may seem like a significant disparity at first glance, but there are other considerations than just the hourly rate. The differences are in fact, quite stark.

For both premium call center vendors and low-cost providers, the operational costs are similar: 30% for labor costs, 15% for management, 10% for support as well as infrastructure and technology, and 5% for bandwidth. 30% remains for the vendor margin. However, after deducting the operating margin from the hourly cost, a buyer can begin to get a clearer understanding of what they’re actually paying for.

A premium provider, once the operating margin is accounted for, has approximately US$9.80 to pay for agent and management salaries, as well as support, technology, infrastructure, and utilities. For a low-cost provider, the after-operating margin is only US$5.60. This is where the distinction between high-quality and low-quality experiences becomes clear. 

A premium call center in the Philippines that charges slightly more on a per-hour basis can afford to pay top dollar for the best agents and managers, who in turn deliver superior customer service. For a low-cost provider, it’s not possible to compete on quality because they must offer their services at rock bottom prices. They are therefore forced to cut corners wherever they can, which usually results in low-quality service across every metric.

This drop-off in quality with a low-cost call center is evident across all areas of service, but most crucially in the quality of the workforce. A premium call center compensates agents twice as much as a low-cost vendor can. The top-performing agents, motivated by this, superior work conditions, training and development opportunities, and management support, naturally seek employment with premium vendors. Better pay and perks also result in less agent turnover at premium call centers in the Philippines, which is important to maintaining consistency in any outsourced program.

The additional revenue generated by premium vendors doesn’t just go towards acquiring the most talented agents. It also helps to improve other aspects of the call center experience, including reinvestments into world-class technology and infrastructure, which help to enhance the customer experience through improved call routing, management, and reporting.

There are many good reasons to invest in partnering with a call center in the Philippines to handle customer service, sales, and support. However, understanding call center rates can be difficult for those who’ve never outsourced call center requirements before. When it comes to comparing rates, it’s crucial to dig deeper into understanding exactly what you’re getting for your money and not just focus on the hourly rate alone. When it comes to outsourcing a call center program to the Philippines, the most important factor is quality.

The post Call Centers Philippines – You Get What You Pay For  first appeared on Brutally Brilliant Outsourcing.