Call Center Metrics: Cost Per Minute

Find out what a call center’s cost per minute rate is, how to reduce expenses and more.

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To effectively manage the costs of your contact center and calculate your return on your investment, it’s necessary to understand the total expense incurred divided by the amount of inbound and outbound handle time over a set period of time. This includes hold time. By calculating this figure, you can understand the cost per minute of handling customer interactions to make data-driven decisions.

When you operate a contact center, you have a wide range of associated costs, including employee wages, training, benefits, infrastructure, software, office space and even utilities. These costs were once tabulated to determine the cost per call. However, with most contact centers managing multiple digital and voice channels, a more relevant calculation may be cost per transaction.


One Dollar Per Minute

It is commonly accepted that it costs about $1 per minute for the average call center to service a customer. This number can jump with additional costs, such as indirect labor. Thus, 1,000 customer calls which last five minutes each will cost $5,000. This cost is often compared to providing service on other channels. For example, the cost of developing, launching, promoting and maintaining a mobile app typically costs around $30,000. Will an app decrease call volume by 3,000 calls per year? It’s important to do the math to determine the viability of investing in any additional communication channel.


Reducing Expenses

Technology has dramatically impacted the cost per minute of a contact center. This includes innovations in cloud computing and unified communications, as well as advancements in self-service channels like IVR, chatbots and apps

With contact center as a service (CCaaS) solutions available on a subscription basis, there is no longer the need to buy expensive, resource-draining contact center hardware. An average cloud-based contact center solution used to cost between $1,200 and $1,500 per agent. Then, would also have to include installation, integration, training and maintenance. An on-premise system can cost $150,000 or more plus the added cost of IT administration. Yet, a CCaaS solution can be as low as $50 per month, per agent, without any upfront capital investment. This is one of the most straightforward ways to reduce the cost per minute of any contact center.


Balancing Costs with Service

It seems simple enough to focus solely on reducing overhead costs when it comes to cost per minute. Yet, slashing spending on staffing, training and infrastructure can lead to a range of service-diminishing consequences, such as extended hold times, decreased first-call resolutions and higher call abandonment rates.



While reducing overhead isn’t wise if it impacts service, there are other steps you can take to reduce the cost per minute.

  • Improve scheduling – A workforce management tool that is integrated within the contact center system can dramatically improve your ability to understand your scheduling needs. With this vital data, you can not only determine the optimal levels of staffing required, you can also make sure that staff adheres to the schedule, too.
  • Focus on training – When every minute counts, you want to make sure that every agent has the ability to effectively answer customer questions and resolve issues. Training should be something that is continued on an ongoing basis.
  • Deploy a single agent desktop – Giving agents the ability to access all customer information quickly and efficiently from a single source can speed up their ability to answer questions and resolve issues. With a unified desktop that is integrated with CRM and other solutions, every agent can have the information they need at their fingertips. Within a contact center, money is time.
  • Weigh the benefits of outsourcing – A quality team of outsourced agents can potentially reduce your cost per minute. Before you consider any outsource provider, carefully review the contractual service levels, costs and quality of the agents.
  • Reduce service levels – Although it’s great to sustain a common standard such as answering 80% of calls in 20 seconds are less, this may not be possible while still containing your overhead costs. For some industries, the benefits of reducing the level of service makes sense and won’t jeopardize customer relations.
  • Use Callback – By using Callback, you can greatly reduce the time customers wait on hold. This reduces your cost per minute, as well as improving many other key performance indicators.

The cost per minute is a key performance indicator that is rapidly evolving as organizations continue to add communication channels. The simple $1.00 per minute rule is already becoming obsolete. And, this will be more antiquated as customers increasingly shift to self-service channels. When you delve deeper in to cost per minute, the larger focus should be on how is the contact center being managed. By evaluating costs, staffing and management, you can begin to understand and reduce costs while still being the first line of support for your customer.

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