Cost to replace a contact centre agent
For anyone who runs a contact centre, you’d already be well aware that employee turnover is an ongoing issue with agents leaving your business to go onto green pastures.
And with the average turnover for contact centre agents in Australia 32%, that’s a lot of recruitment that needs to occur each year.
But how much does it cost to replace a contact centre agent each time someone walks out the door?
It’s not just the direct costs of recruitment fees and an induction program, there are a number of other costs that you need to incorporate to calculate the true cost to replace a contact centre agent.
In this article, we reveal how to calculate the cost of replacing a single call centre agent and for ACXPA members, we have a easy-to-use calculator that makes it easy to calculate your exact cost.
How do you calculate the cost to replace a contact centre agent?
There are a number of considerations when trying to determine just how much it costs to replace one call centre employee.
Of course, the most obvious cost is that you need to hire another employee to replace them.
But the new employee needs to be trained, it will take them a while to perform at the same level as an experienced agent and they’ll need a lot of support from other roles to help them get up and running.
We’ve built an Employee Replacement Costs Calculator that makes it really easy to calculate each of the different components, with the three key categories including:
1. HR/Recruitment Costs
Recruitment agency fee/job ads, time to conduct interviews, reference checking, pre-employment checks, etc.
2. Training/Induction Costs
Salaries for the initial training/induction period for the new employee, the time required by other roles (trainers, product managers, coaches etc.) that need to invest time conducting the training.
3. Reduced Productivity
How long it takes the new employee to be fully competent, plus the impact on the productivity of employees who need to spend time supporting the new employee (other agents, Team Leaders etc.).
How much does it cost to replace a call centre employee in Australia?
Based on industry averages for 2024, the average cost to replace a contact centre agent in Australia is $21,561, representing approximately 32% of the average annual salary for a contact centre agent.
Knowing the actual cost of replacing a contact centre agent is crucial as it’s a powerful tool in prosecuting a business case for more investment in activities to improve employee engagement and reduce the cost of turnover.
4 Tips to reduce the costs of replacing a contact centre agent
The most direct way to reduce the cost of replacing a contact centre agent is by reducing Employee Turnover, after all, if fewer people leave your business, less money is required to replace them.
Improving employee engagement is always a great place to start, and we’ve got a range of articles on how to boost employee engagement in a call centre, using gamification to improve employee engagement (and productivity), as well as some great resources such as our General Knowledge Trivia Kits that ACXPA members can download.
Of course, you’re never going to achieve 0% turnover, and if you are, it may be indicative of other issues in your business (i.e. lack of effective performance management), so these tips specifically relate to ways you can reduce the costs assuming you have some turnover.
1. Invest in a Knowledge Management platform
A KMS has been proven to reduce the time spent in induction between 30% and 90% as well as a host of other benefits for existing employees, providing a great Return on investment.
2. Use a recruitment agency with specific experience in contact centres
Contact Centres are a unique environment, and by using a recruitment agent that specialises in the contact centre industry, the employees they put forward will typically have a much higher retention rate as they have experience in screening candidates to ensure they are going to be suitable for contact centre work that will ultimately save you a lot of time and money.
3. Standardise your onboarding process
Having a consistent, repeatable and documented process enables you to manage the onboarding process more efficiently.
From new hire checklists, contracts, a standardised workstation (or work from home pack) etc. it will make the process a lot easier for all parties involved.
4. Dedicated new hire pathway
It might go by different names such as nursery, sandpit etc. but having a dedicated area for your new employees can be a great way to ensure they get the support they need.
It can include things such as:
- Higher support ratio of Team Leader to agents
- Being stationed next to an experienced employee
- Having easier/simper types of calls as they find their feet
- Recap session at the end of each shift
Summary
“Information is power” is a common term used in business and this particularly applies in contact centre managers understanding the cost to replace a contact centre agent in their contact centre.
Assuming the average cost of just over 30% of the annual salary, and with turnover in a contact centre typically over 30%, the cost to replace a contact centre agent can significantly impact the bottom line.
Whilst there are some things you can do to reduce the direct costs of replacing call centre agents, the biggest budget impact is by reducing the cost of employee turnover in the first instance.
There isn’t a silver bullet that can instantly fix turnover as there are typically multiple factors in play, but one thing we can be sure of is that ACXPA is packed full of resources to help you run efficient and effective contact centres, and we’ve included a few handy links for you below.
Handy Links:
- Learn more about Employee Turnover, including expert tips on how you can reduce it.
- Calculators for Employee Attrition and Employee Turnover
- Fortnightly Roundtables for Contact Centre managers
