When Price Shopping Can Backfire
May 04, 2017
By: Scott Newman
Everyone loves a deal! There’s nothing wrong with trying to negotiate the best deal for your business. But diluting the value of a service too far can backfire for your company.
I believe finding the right DNA match between a company and an outsourcer is the most important aspect of any successful outsourcing relationship. But many times, we get calls just asking for our rates. Our response is usually to ask “what are you looking for?”
The reality is that a price from an outsourcer is relative. What’s included in that price? Are there a la carte items — add-on services that will increase the price? Is there proper oversight to ensure the highest quality product? What about technology?
One of the most misleading numbers is a location’s minimum wage. Many people think it’s the biggest driver in determining an outsourcer’s bill rate. But if the outsourcer is paying its people minimum wage, (1) what caliber employee is representing your brand and (2) what is the turnover rate?
Most minimum wage jobs are stepping-stone positions, and turnover tends to be high. As a client, do you want a fresh body on your program every few weeks? Most likely not since they will never fully understand your brand and corporate values, and they’ll never get over the learning curve. Your brand suffers in the end.
In my business, one of the biggest factors is the support staff we provide for any project. Our focus is high-quality service that represents our clients’ brands well. Our support position payroll is what many would consider “bloated,” but it fulfills our mission. For us, that’s more important than having the most competitive rates in our region. Most clients want consistency in an organization, one that stays true to its values and mission.
When I say pricing is relative, I mean it’s relative to the value the outsourcer is providing. Compare two outsourcers: outsourcer 1 charges $15 per hour and outsourcer 2 charges $20 per hour. You’d say outsourcer 2 is $5 more per hour. But what if outsourcer 2 had lower talk times by 15 percent because they were better trained.
Their turnover was 50 percent less. Their CSAT survey results were 10 percent higher, and their client services were more robust, taking more responsibility off your plate.
Who’s really more expensive? Outsourcer 1 or 2? From just a pricing standpoint, it would be outsourcer 2. In reality, outsourcer 1 is leaving so much opportunity on the table, they’re costing your brand far more. And they’ll need more oversight. Outsourcer 2 is more cost-effective.
Choose an outsourcer whose DNA matches your company’s values. Make that choice first, and the rest will fall into place.
About Transparent BPO:
Transparent BPO was founded in 2009 to provide its clients with superior omnichannel call center services and business process outsourcing at competitive pricing. Belize is Transparent’s ideal location as it offers an educated English-speaking population, reliable telecommunications, and an overall friendly environment. With Spanish being the second language of Belize, Transparent BPO can offer highly qualified bi-lingual agents. Transparent’s state-of-the-art call center system development and IT support allow for seamless integration, resulting in a transparent business relationship.
Contact Transparent BPO for more information HERE.