Let's examine that shall we? From my perspective of many years in business an answering service is more cost effective than a receptionist. Yes, that’s right an answering service can save you money. "How?" you may ask. An answering service saves you money by eliminating payroll taxes, benefits, insurance premiums and other administrative costs of a direct employee. Those are no longer your concern since the answering service is employing the person(s) who are answering your phone calls. In some states, those costs can be 50% or more of the salary you are paying your receptionist, aka, your answering service. That's a large sum of money. With me so far?

To illustrate the savings that can be realized when you use an answering service, let's look at some figures. An employee whose main job is to answer phones, transfer calls and take messages, the same things the answering service would do, is generally paid $9-$10/hour. Figuring 21 average workdays per month at 8 hours a day that works out to be $1500-$1600/month JUST in salary. That doesn't include all the administrative overhead of the previously mentioned payroll taxes, benefits, etc. That brings the business' cost to somewhere between $2000-$2400/month.

Now let’s assume that they handle 2 hours of actual calls per day. Per average month that works out to 142 hours of calls. Much of that time is eaten up with wrong numbers, outbound calls, personal calls, etc. so when everything is boiled down to the brass tacks of it, you are paying $2000-$2400/month for about 25-30 hours of actual productive work, which works out to anywhere from $66-96/hour.

With an answering service, most companies have plans ranging from $30/month to $500/month. The answering service can also customize plans for you if needed. For my example we are going to assume you need the average answering service plan. Based on research of a few leading answering services, that plan will cost you $100-$150 a month and you get 100 minutes of call time.

"100 minutes? You just said my receptionist handles 142 hours of calls. How is that going to work?" you are probably asking. With good reason, because it didn't make sense to me either until I dug a little deeper. As I mentioned above, a lot of your receptionist's time on the phone is spent on unproductive calls. Things like wrong numbers, Outbound calls, personal calls, etc. The answering service will not take those calls away from your minutes, they only "bill" you for productive calls. And based on the answering services I have talked to, the 100 minute plan works for 95 percent of their clients who have the answering service serve as their full-time receptionist. And if you need a slightly higher plan, it's only pennies compared to employing the $2000-$2400/month receptionist.

So to recap, your business pays $2000-$2400/month to employ a receptionist, aka your in-house answering service, who is only productive in the terms of the calls handled a small percentage of the time. You can pay $100-150/month for the same level of productivity, maybe better if you customers call after-hours that go to and don't leave a voicemail message. So could your business use extra working capital of $1800-$2200/month? Yes, it probably can no matter the economy. An answering service can give that to you.

Myth: Using an answering service is expensive. Myth Busted

*all figures used above are for illustrative purposes only. Your savings may vary from month-to-month when using an answering service as your receptionist.