Can Your Small Business Afford A Call Answering Service?

Answering Service Business
Jul 15, 2020 / 4 min read

We know better than anyone that small businesses often come with tight budgets, even as you’re starting to grow. You may be swamped with expenses that you never considered before starting up your own venture like invoicing software, liability insurance, and even pest control for your office if you have one. 

A small budget quickly gets pulled in a million different directions, and that’s before adding on “optional” costs like training, marketing, and employee perks that aren’t actually all that optional.

We understand, therefore, that many small businesses are struggling to manage the incoming calls they’re receiving but assume that they can’t afford a call answering service to help them pick up the slack.

So can your small business afford a call answering service?

While there are several factors that can impact this, the resounding answer is typically “yes.” In this post, we’re going to look at what to consider when deciding if your business can afford a call answering service, including the costs of the alternatives that you’d likely fall back on instead.

How Much Do Call Answering Services Actually Cost? 

Call answering service costs can vary dramatically, and it’s always important to choose a high-quality service. Customer service, after all, should be a priority for all small businesses; it’s not an area where you want to cut corners and suffer the loss of customers as a result.

Fortunately, there are plenty of great, reliable, high-quality call answering services that are also affordable. Many of these services will offer flexible plans, allowing you to use what you need and only that. Services like PATLive, for example, allow you to go month-to-month with no contract, and to be charged only for what you need. 

For example, take a look at our pricing structure. Our plans start at only $39 per month for a pay-as-you-go plan that acts as insurance in the event you’re not able to answer a call or it comes in after hours. If you have an idea of how much call volume you plan to route to an answering service, you may opt for a plan that has included minutes and comes with additional benefits like call transfers and lead collection. 

It’s a good idea to opt into tiered pricing models that reflect your current needs. You can choose a plan based on the features you need and the number of minutes you estimate using. The benefits of a tiered plan that allows for the purchasing of additional minutes, too, can save you money; you don’t automatically need to jump from $269 to $399 per month if you happen to need 201 minutes of call time instead of 200. 

With services like PATLive, you can change your plan as you need it. If you have a slow season, for example, you could downgrade your plan, and scale up again as needed. And if you only host an event once a year, you can upgrade your plan to include order processing or event registrations during the time period you need it, and then scale back again. This works for businesses of all sizes during all seasons of the year, and it starts at just $39 per month as a baseline.

Comparing Costs vs. Cost Savings & Profit Opportunities 

Plenty of businesses might see the cost of an answering service and think “well we just don’t need an additional cost”. Before you do this, though, it’s important to consider what you can save and gain by working with an affordable call answering service. These factors can absolutely determine whether or not you can afford to hire one.

There are two main factors to consider here. Let’s look at both. 

In-House Receptionist Costs 

Many small businesses will rely on in-house receptionists if they choose not to hire call answering services. 

In-house receptionists are great, but they do come with significant added costs. And while call answering service costs may seem a little pricey at first, they pale in comparison to the cost of an employee.

The average in-house receptionist salary is around $27,000 per year, but it can go up to $43,000 a year or more. You’ll be paying the base salary, plus employee taxes, potential health benefits for full-time employees, and the costs of added desks, employee accounts, and more. If your receptionist is paid hourly, you may need to worry about holiday pay and overtime, too.

When you compare this to our most high-priced base plan of $999 per month (amounting to $12,000 per year), the cost savings are clear. 

Even with all of these costs, your receptionist will go home once their shift is over, take weekends off, and have sick leave and vacation. And since customers call on all days and at all hours of the day, sticking with in-person receptionist results in a lost opportunity cost. Which brings us to factor two…

The Lost Opportunity Cost 

If you don’t answer the phone when a potential lead calls or customer calls, you may have missed your chance with them all together. Plenty of customers won’t call back and instead may even reach out to a competitor.

This is a huge risk of lost opportunity costs. Every call that you miss might be a customer that could have converted, eating into your profit before you know it.

With 24/7 coverage from an answering service, however, that is something that you don’t need to worry about. Whenever someone calls and your team isn’t able to answer it directly, we will. Agents can utilize personalized call handling instructions to let help the customer however possible, even if it’s assuring them that someone will be in touch promptly. 

Think about all the calls you might miss during off-hours, when your receptionist is at lunch, or even when they’re on the phone with someone else. That’s a lot of potential customers that you may be missing. 


All small businesses are different, and each one has its own unique needs and budget considerations. As a result, there isn’t one right answer for every business, but in our experience, many small business owners benefit greatly in cost savings and profit gains when working with call answering services.

Keep in mind that plenty of answering services allow you to do a free trial to see how it works for you. This can help you ensure that you’re comfortable with the decision, that the service is right for you, and that your customers are happy. Win-win for everyone involved.