How Much Does an Answering Service Cost?

2024-01-02

From accounting professionals to the legal and medical industries, getting customers to call your business is a major goal. However, all too often, those calls go unanswered or potential customers are asked to hold for interminable amounts of time.

The outcome? The majority of those leads will move on to a competitor. In fact, 90% of customers expect a response to their requests or inquiries in 10 minutes or less.  

Your customers or clients will find someone else if they can't call you without having to go through a lot of hassle. So, what is the solution? For more and more businesses, it’s hiring a live answering service.

Of course, everything comes with a price, so you might be wondering how much an answering service costs. To help you choose the strategy that works best for you, we'll break down the average price of a live answering service, the many pricing structures to choose from, and what factors can alter the price.

How much does an answering service cost?

The price of an answering service varies depending on the service provider, the pricing structure you choose, and other factors like additional fees and add-on services. 

For example, at Smith.ai, prices for virtual receptionists range from $285 to $1,950 a month depending on which plan you find most suitable for your business needs. There are also custom plans available at higher call volumes for lower per-call costs. 

In addition to live agents handling your calls 24/7, you receive CRM integration and AI chatbots included in the price. You’ll also get a set amount of calls and transfer destinations depending on the plan you choose. 

Phone answering services, such as virtual receptionists, function as a type of remote phone service, which means live operators based in a remote location answer your business's inbound calls. Virtual receptionists may do a lot for your business in addition to accepting calls, such as booking appointments, generating leads, and building quality relationships with your clients.

Types of pricing structures

Like we mentioned, the price of an answering service will depend on the type of pricing structure you choose. Below we evaluate the two most common types of billing structures you’ll find in the industry. 

Pay per-minute

The most common pricing structure you’ll find is pay per-minute. With this model, you pay for the amount of time an agent spends on each call. Although at first glance it might appear to be a lesser rate, in many cases it really turns out to be more expensive. From the health care and legal industries to staffing firms and pet care services, getting customers to call your business is a critical goal. However, all too often, those calls go unanswered or potential customers are asked to hold for interminable amounts of time.

The majority of live answering services offer plans with set minutes, and if you use more than are included in the plan, you will be charged extra. You’ll also want to ask providers how they calculate their call duration, including whether or not they round up call time and what their overage fees are.

Additionally, it’s harder to predict monthly bills with this type of pricing structure. Sometimes you’ll encounter a “chatty Cathy” or a majority of calls handled that month involved  time-consuming activities like scheduling or payment collection. 

You also run the risk of answering service agents purposefully wasting time on calls, such as by repeatedly asking for names that were obvious the first time. They often justify this behavior as “just being extra detail-oriented” but it’s at the business owner’s expense, and largely unnecessary. This practice results in higher costs for you.

Pay per-call

With a pay per-call billing structure, you will be charged on the total number of inbound and outbound calls received and handled at a flat rate. This is a convenient option that allows you to pay a lower amount per-call based on volume pricing. Some models include a base rate of a specific number of calls per billing cycle. If you go over the base rate, then you are charged an additional fee for each call.

If you are looking for an answering service that includes more than just basic message taking, such as scheduling and lead screening, those calls will take longer than just a few minutes. If you choose a per-call plan, those add-on services can be included in your plan and costs won’t go up on individual costs that happen to take longer. You’ll know your cost-per-call precisely upfront with services charging on a per-call basis. 

For example, if you’ve elected to add on appointment scheduling, that’s a choice you made early on to have a slightly more expensive call, given the immense value a booked appointment brings to your business. Services that say appointment booking is included at no extra cost but charge per-minute can allow agents to spend as much time (read: your money) on the phone while booking appointments and the costs may be higher, more variable, and harder to pinpoint when you see your costs fluctuate month to month. Often the only way to determine what’s happened on calls is to listen to them — a thankless task, for sure.

With this method, your monthly bills will be a lot more predictable compared to any other billing structure and the price won’t go up based on chatty callers. Knowing the actual cost of each and every call makes it simpler for you to determine your ROI and the total value of the answering service you choose.

You should discuss with your provider what exactly counts as a connection because some might charge you for spam calls, sales calls, and wrong numbers.

These calls are never subject to fees at Smith.ai. We'll even block them at no cost to you.

Per-Minute vs. Per-Call Pricing Structure

Service providers typically offer per-minute or per-call pricing structures in a monthly subscription or tiered plan. 

Factors that affect the cost of an answering service

After choosing your preferred pricing structure, you must consider additional elements that affect the overall cost of your plan. Examine some of these factors that influence cost as well as some that might exist but aren't always related to the price you pay.

Factors That Affect the Cost of an Answering Service

Number of transfer destinations

Calls should be answered, customer issues should be resolved, and then, if necessary, the call should be transferred to another party. The number of transfer destinations included in your monthly bill will affect the price you pay, so the more transfer destinations you have, the higher your per-month pricing will be. 

However, you’ll need to balance that increased cost against the benefit of having calls accurately directed where they need to go, plus the ability to ensure only select calls are transferred. For example, it might not be necessary to transfer the call to another location when a live operator can respond to a customer's fundamental questions.

Spam and sales calls

Spam and wrong-number calls are received by every company. Even though the call ultimately did not help your business, some call answering services will still count them toward your monthly call quota or charge you for the minutes spent on the call. 

Check to make sure the answering service you use doesn't charge extra for these or count them toward your quota. At Smith.ai, we do not charge for these types of calls and will even block them for you for free.

Tiered pricing

Providers sometimes offer tiered pricing for different levels of service. The cost increases with the tier, but you also get additional minutes or number of calls as well as other perks. This method typically changes depending on the model provider.

If you have no idea how many minutes or calls you will use each month, this model can be a great place to start. You should be able to determine what tier you need to be in after a few months. The appropriate tier for your company can then be determined by working with your answering service provider.

At Smith.ai, we offer four distinct tiers. Each of these includes specific service offerings and a set number of calls per-month for a specific price. You can even make a custom plan that suits all your needs.

Service term length

Although many businesses have been phasing out contracts for some time, certain call answering services still require them. Recognize that being compelled to sign a contract usually works against you because it ties you to a certain service provider for an extended period of time. 

Additionally, a contract implies that if you breach the agreement, you may be liable for additional fees. At Smith.ai, we only ever request a straightforward monthly agreement with clear pricing rather than a contract. This ensures you know precisely what you’re getting for the money you spend. 

Setup or onboarding fees 

Some answering services could impose extra costs with setup or onboarding fees. At Smith.ai, we won’t charge you any set up fees, onboarding fees, or any other hidden costs for our virtual receptionist services, so you’ll know exactly what you’ll be paying from the start and on an ongoing basis. 

Services included

When you hire an answering service, you’ll want more than just a live person answering your calls. Your business needs a professional that will accurately represent your brand, provide a great customer experience, and assist the caller in solving their concerns.

This necessitates a variety of services, all of which should be available on your plan. The following are some of the services to which you should have access:

  • 24/7 live receptionists
  • Customized greetings
  • Inbound call handling
  • Outbound calling
  • Knowledge of your business, as well as products/services
  • At least one transfer destination
  • Call screening and triage to individuals and departments
  • Individual call summaries and daily “digest” summaries
  • Customer callback for lost/interrupted calls
  • Call notifications by text message
  • Appointment scheduling
  • Answering inbound text messages
  • Call dispositions, including type of caller
  • Call priority (e.g., urgency of the call)

However, not all phone answering services provide all of these features. Some might  not offer a certain feature at all or might restrict some features to higher plan tiers only, limiting what features lower cost plans can access. 

Make sure you are completely aware of the services that are available at your budgeted plan tier , those that are available but for additional costs, and those that are not at all available from the provider before selecting any call answering service.

Add-on services

Whether you decide to pay for any add-on services will be the last factor in determining the price of your answering service. These are valuable additions that are not part of your usual fee. 

We offer add-on services at Smith.ai to provide value only to business clients who find the add-on solution valuable. We charge a per-call fee for services like third-party intake forms, conflict checks, dedicated Spanish lines, complex call routing, complex calendaring, and payment collection, among others.This gives you, the client,  complete control with flexible plans and the option to pay for only what they need. 

With adjustments available to you month-to-month, you’re never locked into a service your business no longer requires; you can also elect to add on services for just a busy season. The result is a tailored program with a service provider who behaves like a responsive partner, not an impersonal corporate subscription.

Choose Smith.ai as your answering service

As you can see, a variety of factors affect how much an answering service costs. Smith.ai offers a wide range of services including 24/7 live answering, lead qualification and intake, appointment scheduling, payment collection, and much more.

View our pricing and plans or schedule a free consultation to learn more about how Smith.ai can benefit your company and what features might be valuable to you. 

Contact us for a free consultation where our team will work with you to identify the needs of your business and match them with the services and solutions that best support your business. 

Tags:
Primary
Virtual Receptionists
24/7 Call Answering
Appointment Booking
Lead Generation
Written by Maddy Martin
Maddy Martin is Smith.ai's SVP of Growth. Over the last 15 years, Maddy has built her expertise and reputation in small-business communications, lead conversion, email marketing, partnerships, and SEO.

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