With the Global Contact and Call Center Outsourcing Market projected to almost triple in size to $219.8 billion by 2033, all businesses from startup level to enterprise have to understand the difference between in-house and BPO call centers in order to maximize the outcome for their organization. Choosing the right one means diving deep into how each one works, so let’s help you figure out which path is right for your business.
What is an In-House Call Center?
An in-house call center is fairly self-explanatory – it’s your own team of customer service agents that work directly for your company, or ‘in-house.’ It gives you full control over the setup and operations of your call center, and more importantly, how your team represents your brand.
In-house call centers involve your business handling everything from hiring to training agents, and managing everyday operations. They give you full autonomy over the customer experience, allowing you to customize your brand’s tone, policies, goals, and everything else that makes your brand unique. And the added bonus: since your team is under your roof (even if they work remotely), you have better control over quality and decision-making.
Despite all its pluses, running an in-house call center isn’t always a walk in the park. It comes with significant expenses like salaries and office space, technology and equipment – and don’t forget about the management effort involved. Even still, it’s a great option for companies who want to be more hands-on with their customer service.
What is a BPO (Business Process Outsourcing) Call Center?
A BPO is essentially an outsourced call center – someone else handles the customer service while you focus on the bigger picture. Third-party providers are different to in-house call centers, as they’re specialized in managing customer interactions – it’s their bread and butter. They can provide a full menu of services like inbound and outbound calling, tech support, order processing, and anything else you want to offer your customers.
And unlike in-house, you don’t have to worry about recruiting, training or onboarding, as the provider takes care of everything from start to finish. They bring all their own tools and technology to the table, making them a great choice for businesses who want to save time and money but benefit from some niche expertise. BPOs are excellent options for scaling businesses, as they can easily handle seasonal dips and peaks, can adapt to multiple time zones, and even support multilingual customers.
Of course, outsourcing your operations means relinquishing a certain amount of control. Your brand is being represented by a third party, but since they’re not your employees, you have no control over how they decide to represent you. In order to maintain quality and alignment with your business goals and values, you have to remain in constant communication or risk breakdowns in service. Still, for many businesses, the cost savings and convenience make outsourcing the better option.
Key Differences Between BPOs and In-House Call Centers
Choosing between BPOs and in-house call centers is really all about the finer details. Each one has its pros and cons, its perks and challenges, but the right one depends on your business’s unique needs. Let’s take a closer look at some key factors to consider when starting your search.
1. Cost
Businesses revolve around money, which means cost is often the first thing they think about when deciding between in-house and outsourced call centers. In-house teams can feel like neverending expense drains: salaries, benefits, office space, maintenance, hardware, software, licensing, overheads – the list goes on. They add up quickly and there’s not a huge amount of wiggle room when your budget is tight.
BPOs on the other hand are often pay-as-you-go, which can be a lifesaver for businesses counting their spare change. Outsourcing means no heavy upfront investment in infrastructure, less operational expenses, and a more affordable method of spreading costs out over a period of time. You’re still paying for services, but you’re sharing the cost of the BPO’s technology, expertise, and resources with their other clients – you’re just paying for your portion.
2. Control and management
In-house call centers are most suitable for businesses who want to be in the driver’s seat. They allow you to fully manage your customer service operations from top to bottom, giving you full control over each and every detail, from training and script design, to performance monitoring and shaping your brand voice.
BPOs are quite the opposite. They’re ideal for businesses that value convenience over direct control. While most outsourcing providers work closely with their clients, they still work independently. You can’t hold their hand and guide them through your desired operational path – they decide how they’re going to manage it based on the goals you’ve set. You simply have to trust them to follow your rules without overseeing every move.
3. Flexibility and scalability
Growth is the main goal of many businesses. But what happens when your call volumes suddenly double overnight? That’s where in-house call centers can sometimes struggle with scalability: you can’t hire and train new agents instantly, and you certainly can’t invest in more desks, headsets, and software licenses in the click of a finger.
BPOs, though, are built for that flexibility. Even if you need 20 more agents tomorrow, you can have them. Outsourcing providers have the infrastructure and resources to scale up or down on a whim, and can easily overcome seasonal changes, new product launches, unexpected surges in customer inquiries, and any otherwise unforeseen circumstances that an in-house call center wouldn’t be equipped to deal with.
4. Staffing and recruitment
Building an in-house team gives you control over every part of the hiring process, from recruiting the right talent all the way through to managing your new staff. This means that you get to oversee how your team’s expertise is put to work, and align it with your brand and business goals. While doing so gives you full autonomy over your operations, it’s the more costly and time-consuming option.
If you’re looking for all the heavy lifting to be done for you, BPOs are the way to go. The provider handles all the recruitment, training, management and everything else associated with staffing. They also have multilingual agents and specialists trained in specific areas of expertise who can provide more niche services.
5. Technology and infrastructure
In-house call centers require serious tech investments: you’ll need to set up phone systems, CRMs, analytics tools, AI-driven chatbots and dialers, and plenty more to keep up with customer expectations. And what’s more, you’ll have to constantly maintain them: ongoing expenses associated with upgrades, IT support, and tech maintenance can quickly stack up, but without them, your operations won’t run smoothly.
BPOs come packaged and ready to go – they’re fully equipped with top tier technology and infrastructure, so you don’t have to worry about it. Providers invest in the latest tools and platforms, giving you access to powerful systems without having to break your budget. In essence: you get all the benefits without the headache.
Pros and Cons of In-House Call Centers
In-house call centers have a variety of advantages, but they’re certainly not perfect. Let’s take a look at the good, the bad, and the slightly complicated when it comes to managing your own customer service team.
| Advantages | Disadvantages |
| Full control over operations, enabling businesses to customize training, scripts, and processes to align perfectly with their brand. | High costs when it comes to premises, equipment, office space, software, and hardware. |
| Agents are fully immersed in your business values and company culture, which leads to stronger brand representation and ultimately, loyalty. | Staffing challenges like recruitment, training, and retention of skilled agents can be costly and time-consuming. |
| Better quality assurance as it’s easier to monitor your own processes to ensure high-quality customer service through direct management. | Expanding the team during seasonal spikes can mean extra resources, time, and effort, which leads to scalability issues. |
Pros and Cons of BPO Call Centers
| Advantages | Disadvantages |
| Cost savings with more flexible pricing options and less infrastructure expenses. | Loss of control as businesses have to rely on the BPO to maintain service quality and brand alignment. |
| Can quickly adapt to changing business needs during seasonal spikes or dips, making it flexible and scalable. | Possible delays due to communication barriers or miscommunication, especially with overseas providers. |
| Provides access to advanced technology like AI analytics and omnichannel support, which is often out of reach for small businesses. | Outsourced teams might not get the company culture or tone of voice across correctly, which can lead to inconsistency and a less authentic customer experience. |
| Industry professionals bring special expertise and best practices to the table. | Businesses have to make sure the BPO adheres to security and data protection standards to avoid data security concerns. |
Which is Better for Your Business: BPO or In-House?
Deciding between the two isn’t a one-size-fits-all approach – it’s more like deciding which tool is right for the specific job. The best choice for your business depends on a variety of factors, like your business size, needs, budget, long-term plans, and future goals. Finding the right path for your business means exploring your options and seeing how each industry differs. Let’s have a look.
Company size and budget
For small or medium-sized businesses, outsourcing customer service can be a lifesaver. It’s a cheaper, more convenient option that gives you access to professional services without having to invest in an in-house team. It’s like getting all the benefits without the steep expenses.
On the other hand, for larger companies with a bigger budget, a hands-on approach might be more desirable. Sure, in-house call centers are more expensive, but they’re fully controllable by your business, allowing you to customize exactly how you want your customer service to be.
Need for control
Many businesses thrive on authenticity – and when it comes to their brand representation, they don’t mess around. If you want to shape every single customer experience down to the last detail, an in-house call center is the best way to go. It gives you direct oversight, allowing you to monitor agent and team performance, change strategies on the fly, build a team that lives and breathes your values, and get full visibility over operational performance. What more could you ask for?
Well, if you’re willing to trade some control for efficiency and convenience, a BPO might be your go-to. When you outsource your customer service, you shift the responsibility to a third-party provider who specializes in top-notch service. Hiring an expert and trusted partner gives you the freedom to work on growing your business while they handle the heavy lifting.
Long-term goals
A major aspect of your choice is your future plans. Are you looking to grow quickly? Expand into new markets? Handle higher volumes of customer inquiries? BPOs excel at scalability, making them the best choice for any business with growth at the forefront.
In contrast, in-house call centers are ideal for businesses focused on building a consistent, long-term customer experience that aligns with their goals and internal operations. It might be a slower build, but the payoff is worth it in the form of top quality, branded service.
Industries and business types
Every industry has different needs, which means each one will gravitate toward one option over the other. For example, startups and e-commerce companies prefer flexibility and cost-effectiveness, so would naturally lean towards BPOs. They can tap into a larger talent pool and access advanced technology they otherwise wouldn’t be able to invest in, making BPOs the better choice.
Meanwhile, healthcare, finance, or luxury retail industries prioritize trust and security above all else to keep their brand representation top-tier. Because of this, in-house call centers are the obvious choice, as they provide direct oversight and compliance with regulations.
Choosing the Right Solution for Your Call Center Needs
Choosing between a BPO and in-house call center ultimately comes down to your business’s individual needs and goals, as well as budget and priorities. If it’s cost savings and flexibility you’re after, a BPO can do the job, while giving you access to advanced technology and scalability options. But, if you’re in the market for direct oversight, control, and alignment with your brand, go for an in-house call center – it’s worth the investment.
And remember, there’s no rush: take your time to weigh up your options, keeping your long-term goals and customer experience in mind. The right choice for your business is the one that supports long-term growth while keeping your customers feeling valued and heard.
