We work with a lot of small businesses and most of them tell us that price is the single most important factor when selecting a new answering service. So if you’re looking for an answering service, you’re probably comparing prices first. And with that, you’re likely finding varying degrees of cost, as well as different billing metrics, i.e. per call, per minute, or flat rate. For the cost conscious small business, we’re going to discuss how per call answering service billing can align with your budget.

Per call billing, also known as per action billing or per increment billing, gives you a billing method that is based on how many actions the answering service performs on each call and not the length (talk time) of the call. Actions usually include text messages, faxes, warm transfers, cold transfers, pages, and reach attempts. Depending on how your protocols and message delivery options, per call billing allows you to tap into a lower pricing structure compared to per minute billing.

Here’s how per call billing can meet the needs of your small business and stay on budget:

1. It’s not based on the length of the call

As the name suggests, a per-call billing structure is based partly off the number of calls a customer gets and not the length of each call. On a per-call structure, customers will typically pay for each incoming call in addition to any action the operator takes while handing the call. These actions can include outgoing calls (like warm or cold transfer, or following an on-call procedure) as well as the sending of texts and/or emails.

Depending on how many calls your business gets a month and what those calls consist of, per-call billing is generally a cheaper method of answering service billing. For example, a customer on a per-call service level may receive 10 calls a month, which may result in 6 messages, equaling 16 total call counts. Their monthly invoice may hover around $50. However, a customer on a per-minute service level may receive the same number of calls, but each call may last 10 minutes. This would make their monthly invoice hover somewhere between $100-$120, respectively.

2. Message delivery adjustments can decrease cost

Since per-call billing includes each inbound call in addition to each action taken by the operator, costs can begin to add up. However, if you’re looking to keep costs low, you’ll want to look for a per call answering service that allows their customers to customize how they receive their information.

For example, if multiple people in your business are receiving texts, see if your answering service can group them all into one call count or one billable action, instead of counting them all separately. Another great way to help keep costs low is by customizing when you receive messages. For example, asking your answering service to send all urgent messages as they come in and send all general messages in one report at the end of the day or the beginning of the next day can help eliminate excess costs and allow your staff to prioritize call-backs more efficiently.

3. Transfer and reach adjustments can decrease cost

For a small business working with a tight budget, there are ways to help save money and reduce costs. Adjusting how your answering service transfers or reaches out for calls can help keep invoices low. Since each call out would be considered as a call or a billable action, you’ll want to limit each transfer or reach attempt and make sure your answering service is only reaching out for urgent situations.

For example, if your answering service was transferring every call to your in-house team, your call counts will start to stack up, resulting in higher and perhaps unexpected invoices. However, if you implement guidelines of when they should reach out and how often, you can help keep your answering service bill low while still making sure your customers are receiving the best possible care.

4. Not paying for technology you aren’t using

Generally speaking, most answering services that charge per-minute offer an advanced system which you can access, usually including access to an online portal and innovative features like access to call recordings and the ability to update your script in real time.

While having access to an online portal is helpful, not everyone needs all of the bells and whistles that typically cause an answering service to be a bit more expensive. Many folks are totally fine with just having a standard answering service set up with limited features, and can wind up saving money because of it.

5. Same access to important features, like scaling and customer support

While per-call services might feel a bit more antiquated in terms of advanced features offered, they aren’t. Where a per call service may not be able to offer technological advancements, they will make up in personal customer service. Traditionally, smaller per call services are known for exceptional quality service to your customers, and can even scale along with your business. For example, many per-call answering services are smaller in size and can easily offer your customers a personalized experience. They’ll get to know your customers and you’ll get to know them, too! Answering service agents who are familiar with your brand are usually more engaging with callers and can help drive sales and increase customer retention.

As your business grows, your answering service will be able to grow with you. In fact, many businesses that start out on an answering service’s lowest plan usually find themselves needing to increase simply because of how many calls they’re getting that they previously wouldn’t be able to handle. More calls leads to more business, which leads to more money to reinvest in the growth of your brand.

The post 5 Reasons Per Call Answering Service Billing May Be Right For You appeared first on Specialty Answering Service.

Depending on your call volume, tweaking your script and protocols can lower your bill by as much as 25%. Keep reading for some simple ways you can lower your answering service invoice:

Scripting

Answering service scripts, or the formatted conversation the virtual receptionists have with your callers, are one of the biggest culprits behind high answering service invoices – and the best place to look for cost-cutting opportunities.

1. Remove unnecessary questions: Having your answering service gather information from your callers by asking loads of qualifying questions may seem helpful, but in the end it will only eat up time – and money. A better option is to have your answering service gather the basics, and have your in-house team follow up with the nitty-gritty.
2. Eliminate paths that aren’t used to simplify decision making: When using an answering service, it’s important to remember that the operators handling your calls are not experts in your business. So, to avoid errors and lengthy calls, you’ll want to eliminate script paths that may clog up the workflow. For example, if your script has paths for Quote calls, Sales calls and Service calls, your agents may have trouble deciphering when to take each path. If you don’t want to eliminate any paths, then we recommend adding a driving question up front that will help steer the call and guide the operator to the correct path, like “Thank you for calling ABC Medical, is this an emergency?”
3. Consolidate paths where available: Within any business, there could be a hundred different reasons why a customer may be calling, but that doesn’t mean you should include every possible scenario in your answering service script. A better approach is to include the call scenarios that come up most frequently, like calling to schedule an appointment or calling for service, and then have a general path the operators can take for everything else. If you want your operators to take messages or transfer calls for specific people or departments, you should consolidate those two options into one path which would include a list of names and departments. The more succinct and straightforward your script is, the less time the operators will spend on the phone and the lower your invoices will be.
4. Adjust lengthy FAQs into their simplest form: While it is helpful to arm your answering service operators with frequently asked questions about your business, you don’t want to stuff in every possible answer to every possible question, and you also don’t want to write paragraphs of information. Not only will the operators have trouble navigating lengthy and complex FAQ sections, but the more information you add, the more time it will take them to read through and find whatever they’re looking for, which will definitely result in higher invoices. We always recommend to keep your FAQs short and sweet. After all, you are the best person to handle the more in-depth questions your customers may have.

Protocols

Unnecessary protocols are the second largest expense behind most high invoices. To guarantee a cheap answering service, adjusting how you’re contacted for messages can make a sizable dent in your overall answering service bill.

5. Replace warm transfers with cold transfers: With many answering services that charge by the minute, warm transferring calls to you or your in-house staff does come with a price. While you’ll most likely not be charged the same rate once the call is transferred, as long as that line is being used, you’re being charged a patch or transfer fee. If you need your service to transfer calls, a better approach would be to have them cold transfer instead of warm transfer. If no one is available, your callers can simply leave a message for a return call which will help keep your invoices lower.
6. Reduce the number of outreach attempts associated with an on-call schedule: If you’re having your answering service reach out to your on-call staff, a good way to keep your invoices low is to limit the amount of times your operators are reaching out. If each reach out attempt takes 1-2 minutes and your operators are reaching out until someone answers, and all of your employees are dodging work, you’re going to have a hefty bill on your hands. We suggest capping your reach attempts at 3 and leaving a message so your staff has the information they need to call the customer back.
7. If on a per-call billing model, evaluate how and when messages are sent: Not all answering services charge by the minute, and a per-call answering service structure may wind up being more cost effective for you. Typically on a per-call billing model, each inbound call counts as a call, as well as any action the operator takes (like emails, text messages, transfers, etc.). Because of this, any message you receive may wind up costing you. However, if you’re working with a tight budget, there are some ways to help keep invoices low, like controlling how and when messages are sent. For example, you can work with your answering service so that any urgent message comes through right away, and all other non-urgent messages can be sent together as a report at the end of the day, or the beginning of the next day. That way you can consolidate your messages, and lower your invoices.

Technology

If you’re looking for a low cost answering service, leveraging technology can help with that. Using the technology available to you can reduce your live operator talk time and lower your bill by as much as 12%.

8. Use IVR to route calls: While virtual receptionists are great at transferring calls, a small business working with a limited budget needs to cut out any unnecessary expenses whenever possible. Instead of having your answering service transfer calls for you, implement an auto-attendant that can route calls instead. Callers will be able to select whichever option suits them best, and be immediately directed to the person or department they’ve selected. While IVRs may come at a price, they’re way cheaper than the general cost of live operator talk time.
9. Give customers a voicemail option: In a time where customers are used to getting answers immediately, voicemail isn’t always a preferred method of communicating with a business. However, if given the choice, many consumers are fine with leaving a message to have their call returned at a later time. Not every question or inquiry needs an immediate response, and the more customers willing to leave a voicemail means less money you have to dish out for your answering service invoice.
10. Update your script or on-call on your own to eliminate programming fees: Updating your answering service protocols can sometimes incur programming fees. To avoid these extra fees, it’s a good idea to become familiar with making updates on your own, if your answering service offers it. Additionally, making updates on your own means you are in total control and don’t have to wait around for the programmers to complete it, which may take several days.
11. If you get charged for message transmissions, use an app or web portal instead: Depending on the answering service you use or the service level you’ve signed up for, you may be charged for message transmissions. However, if your answering service offers a free mobile app or web portal, you can eliminate the cost of message transmissions by simply checking your app or portal for new messages. Mobile apps are very helpful for users who are constantly on the go, like medical professionals and utility services.

Others

Outside of auditing your scripting and protocols while adding technology layers to lower your invoice, there are a few other options.

12. Eliminate sub accounts if they aren’t getting traffic: Adding sub accounts are a great way to keep multiple business lines consolidated under one roof, but they’re not always necessary. For example, some businesses may want to be accessible for Spanish speaking customers and opt to open up a Spanish sub account. However, if you’re hardly getting any traffic on the Spanish line, it probably isn’t worth the extra charges.
13. If you get charged for a toll-free number, request a local: Some businesses like to use toll-free numbers to either make their company seem more official, or so out of town customers don’t get charged long distance fees. However, answering services may charge extra to use toll-free numbers, which may not be cost effective for your business. Local numbers are usually free, and if you’re forwarding your own lines to the service, then your customers will never see that number anyway!
14. Adjust the times you’re sending traffic to the answering service: Generally speaking, answering services are available to answer your calls 24/7. However, that doesn’t always mean you should use them around the clock. The more phone traffic your answering service handles, the higher your invoices will be. If you’re strapped for cash, then you’ll want to limit the times in which you use your service. For example, having your in-house staff handle calls during the day and having  your answering service handle calls after hours is a great way to keep your call volume and invoices low.
15. Eliminate telemarketing calls: It’s no doubt that telemarketers love to call. It is their job, after all. However, it doesn’t mean you should have to pay each time they call and eat up your minutes. If you’re getting a lot of robo-calls, we suggest adding an IVR upfront which would prohibit those calls from coming through. If you have actual people calling, you can set up a path within your script the operators can follow which simply tells them you’re not interested. If they’re still persistent, see if you can have their number(s) blocked either through your phone provider or your answering service.

For more about answering service pricing plans, per minute and per call pricing, flat rate answering services, pay as you go plans, and more – please check out our Ultimate Guide to Answering Service Pricing.

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When it comes to pricing, there is no one-size-fits-all formula. In fact, within your own business, you may price the same product differently based on the time of day, the geography, or the particular sales channel being utilized. You may even price differently based on the weather – seasonal fruits are a typical example of this.

Many small businesses make the mistake of pricing too low in an attempt to attract sales volume, but this can lead to cash flow issues. On the flip side, if you set prices too high, then your potential customers may look elsewhere, especially if you are in a market where there is serious competition from big players. So what is the right price?

What is the Right Price?

The right price should ideally fall between the costs you have incurred and the way consumers value your product. The value you provide must outweigh your expenditures. Costs can be direct and indirect, ranging from the cost of creating and marketing your product, to overhead expenses, such as telephone charges, utilities costs, employee salaries, etc. And they will quickly add up. So, in order to command a premium price, your product alone isn’t enough. Provide value-added products or services, and learn to effectively communicate this value to your customer.

We’ve boiled the process down to 7 steps to help you determine the right price:

1. Calculate the total cost of your product, including all direct and indirect expenses. To help, we’ve created an expenditures worksheet you can download here. This is your base price.
2. Decide on the minimum profit margin that you want from your business, and don’t set minimum profit expectations too high! Add that to your base price to arrive at your minimum selling price.
3. Now unless you are selling a completely innovative product/service, pricing is best determined by the marketplace. Look at how much the competition is charging for similar products/services. If your base price is higher than the competition’s market price, you’ll need to reexamine your costs, and do a cost cutting exercise.
4. Let’s assume that the competition’s prices are much higher than your base price. The highest price that any competitor is charging can be your ceiling price. Also, identify which competitor is the market leader in the geographic area where you plan to sell your products and what they are charging. This will form your most viable price.
5. If your minimum selling price is lower than the most viable price, then you can charge slightly lower than the most viable price and still garner market share. Of course, your product offering and communication of value to customers (marketing) will have to be stronger than the market leader. You will also need to differentiate your offering in some way that makes it difficult for the competition to replicate. For example, if you are selling homemade pizzas, why not use organic, locally-sourced ingredients, and highlight that to your prospective customers? This, along with the right price, may be difficult for large pizza chains to replicate.
6. If your minimum selling price is higher than the most viable price, then you should consider pricing even higher than the ceiling price. This would require you to position your offering as the most premium service in the marketplace, and you will need to deliver on that promise. Small businesses may find this difficult to achieve, unless you are a niche player such as a wedding photographer or a wedding dress maker. Customers do not mind paying for exclusivity on special occasions. If you are in that market, then high quality products and customer care, along with the high prices to match, would make you a winner.
7. Test and tweak. No matter what pricing approach you follow, not many entrepreneurs get it right on the first try. As a small business owner, try not to take on too many commitments in terms of raw materials or office space before you have arrived at the perfect mix of price and business strategy. You may need a few attempts to figure out your customers’ preferences and willingness to pay. Be open to experimenting with your pricing, especially in the early stages. Sam Walton tried multiple pricing models before he arrived at Walmart’s “Everyday low price” model.

If you’re struggling finding the perfect price, keep in mind that it is easier to lower prices than to raise them at a later stage. When in doubt, always price higher, and aim to offer more value than your price deserves. If higher prices aren’t working, it’s time to change your prices.

When Should You Change Your Prices?

Knowing when to raise or lower prices is just as important as pricing right in the first place.

Raising: You may raise prices when you offer additional benefits for customers, but remember that not every product feature will translate into an additional benefit. You could increase pricing when your own costs have increased, such as in high-inflation markets when raw material costs are climbing. Pricing can also be upped during peak demand or when your offering is unique. If you are going to raise prices, then give customers a heads up, and explain your rationale.

Lowering: Prices can be lowered if you are entering a new market to increase trials or if a new competitor is in the game and trying to take away your clients with lower prices. If it’s the latter, then a smarter strategy is to explain to clients why they are better off with you, even if they are paying a premium.

The final post in this series will focus on common pricing pitfalls that small businesses encounter and how you can avoid them.

The post Small Business Pricing to Win, Part 3: Arriving at the right price appeared first on Specialty Answering Service.