Right Size Your Answering Service to Maximize Efficiency and Boost Bottom Line Results

In a prior post we asked if your small or medium-size answering service was the right size. Though growth occurs on an account-by-account basis, the infrastructure to support it usually stays steady for a time and then takes a big jump. It’s these surges in infrastructure that can take a right-sized answering service and turn it into a wrong-sized operation.

If your small to midsized answering service attempts to operate in a wrong-sized environment, it’s going to be inefficient and possibly unprofitable. Though this scenario is unavoidable as growth occurs, the goal is to minimize the time spent operating a wrong-sized answering service and move to the right size as fast as possible.

Here are three ways to right size your small to medium-size answering service.

Add Accounts: The most common solution to move a small to mid-size answering service from a wrong-sized configuration to the right-sized operation is growth. That is, you can grow yourself into the right size. There are three approaches to adding accounts.

The most common way is through organic sales and marketing. This is how most answering services grow. Though this is a controlled and manageable approach, it also takes the most time. This means you’re going to spend more time not being the optimum size. And it will cost you.

Another popular way to grow is through acquisition. However, the key is to make the right size purchase. The acquisition needs to have the right number of accounts and the right amount of traffic to move your answering service from the wrong size to the right size. However, taking on too large of an acquisition could simply move your answering service from one wrong-sized threshold to another wrong-sized threshold. This doesn’t solve the goal of moving your answering service into a right-sized operation.

A third growth strategy is hiring a sales and marketing company to bring on new accounts. They can do this at a controlled rate, according to your specifications. More importantly they can do this much faster than you can do in house. As a result, you grow to that right-sized sweet spot much faster. This may be the best solution if you want to increase your number of accounts to again become a right-sized answering service.

Decrease Accounts: Though most people want to grow their answering service to right size it, another solution is to shrink your answering service to a point where it operates in a right-sized situation. You could do this by selling accounts, a fast way to accomplish this.

Another strategy is to raise rates on unprofitable and marginally profitable accounts. This will bring in new revenue or send marginal accounts to your competitor or both. Regardless, this quickly moves you toward being the right size.

A related strategy is to outsource your overflow to another answering service. Though this doesn’t decrease the number of accounts, it does decrease some of the demands on your infrastructure, which can have the same effect as decreasing your client base.

Decrease Costs: Reducing expenses is another way to regain the ideal status of being a right-sized answering service. One way is to cut unnecessary expenses. Another approach is to eliminate unneeded positions. But these can only take you so far.

To achieve needed cost reductions, you may need to look at outsourcing some functions such as billing and collections, human resources, management, technical, sales and marketing, or even operations. The point is that you can outsource any aspect of an answering service. If it’s more cost-effective for someone else to do it, the smart business move is to let them.

Related to this is to outsource third shift and other slow traffic times when the call traffic doesn’t warrant staffing your office. Just send those few calls to someone else. This is a great way to reduce your payroll, which is an answering services greatest expense.

Become a Right-Sized Answering Service: If your small to medium-size answering service struggles to be efficient or to produce an acceptable profit, it may be that you’re trying to operate under an infrastructure that’s misaligned with your client base and call traffic. It might mean you’re wrong sized.

Move to the right size as quickly as possible by increasing your number of accounts, decreasing your client base, or outsourcing functions that allow you to save money. And as you do these steps you’ll find that your efficiency returns, and your profits jump.

 

Peter DeHaan is a freelance writer from Southwest Michigan. Call Center Sales Pro, a premier sales and marketing service provider for the call center and telephone answering service industry, helps clients grow their revenue and improve their operation. Contact Janet at contactus@callcenter-salespro.com or 800-901-7706.