Build vs Buy: In-House Call Center or Outsource?
Complete decision framework to help you choose between building an in-house call center or outsourcing to a BPO. Compare costs, timelines, risks, and long-term ROI.
Build In-House
Buy (Outsource)
Total Cost of Ownership: Build vs Buy
| Cost Component | Build In-House (US) | Buy BPO (Offshore) | Buy BPO (Nearshore) |
|---|---|---|---|
| UPFRONT / ONE-TIME COSTS | |||
| Facility Setup | $50K-$200K | $0 (included) | $0 (included) |
| Equipment & Furniture | $50K-$125K (25 agents) | $0 (included) | $0 (included) |
| Technology Infrastructure | $100K-$300K | $0-$10K (integrations) | $0-$10K (integrations) |
| Recruitment & Hiring | $75K-$150K (25 agents) | $0 (included) | $0 (included) |
| Training Development | $50K-$100K | $5K-$20K | $5K-$20K |
| Legal & Compliance Setup | $25K-$75K | $0 (included) | $0 (included) |
| Total Upfront Investment | $350K-$950K | $5K-$30K | $5K-$30K |
| ANNUAL ONGOING COSTS (25 Agents) | |||
| Agent Salaries & Benefits | $1.2M-$1.6M | Included in rate | Included in rate |
| Facility Costs (rent, utilities) | $150K-$300K/yr | Included in rate | Included in rate |
| Technology & Software Licenses | $75K-$150K/yr | Included in rate | Included in rate |
| Management & Supervision | $200K-$400K/yr | Included in rate | Included in rate |
| HR, IT, Finance Support | $100K-$200K/yr | Included in rate | Included in rate |
| BPO Service Fees (all-in) | N/A | $420K-$780K/yr | $575K-$1.1M/yr |
| Total Annual Operating Cost | $1.8M-$2.6M | $420K-$780K | $575K-$1.1M |
| 3-Year Total Cost | $5.8M-$8.8M | $1.3M-$2.4M | $1.7M-$3.3M |
| Savings vs In-House (3 years) | Baseline | $4.5M-$6.4M saved (73-78%) | $4.1M-$5.5M saved (63-71%) |
Get a personalized cost comparison based on your specific requirements (agent count, location, services, volume). Input your parameters and see exactly how much you'll save with outsourcing.
Calculate Your CostsTimeline to Launch: Build vs Buy
Build In-House: 12-18 Months
Real estate search, lease negotiation, facility buildout, technology vendor selection, hiring leadership team
Network installation, phone systems, CRM configuration, furniture delivery, security systems, compliance setup
Mass hiring campaign, onboarding, training program development, knowledge base creation, practice sessions
Pilot launch with limited volume, quality monitoring, process refinement, gradual ramp to full production
Achieve target quality metrics, stabilize attrition, optimize processes, scale to full capacity
Buy BPO: 6-8 Weeks
RFP process, vendor demos, contract negotiation, requirements documentation, SLA definition
BPO recruits agents, conducts interviews, background checks, skills assessments. You approve final candidates.
Product/service training (you provide materials), tool access provisioned, systems integration, practice scenarios
Start with 10-20% of volume, monitor quality closely, rapid feedback and adjustment cycles
Scale to 100% volume, achieve target KPIs, ongoing optimization and quality monitoring
BPO delivers 3-4x faster launch, getting you operational and serving customers in a fraction of the time
When to Build vs When to Buy
Build In-House When:
At this scale, economies of in-house management offset BPO margins. Break-even typically around 500-750 agents.
Customer interactions are strategic differentiator. Proprietary processes or sensitive data can't be shared with third party.
Need direct oversight of every process, quality standard, and employee. Can't delegate operational control.
Committed to 5-10+ year operation. Have capital for upfront investment ($500K-$2M+). Patient ROI timeline.
Contact volume doesn't fluctuate significantly. Can forecast headcount 12+ months out. Low seasonality.
Need very specific skills, certifications, or local market knowledge that BPOs can't source effectively.
Agents need deep cultural immersion in your brand values, mission, product philosophy that's hard to replicate externally.
Buy (Outsource) When:
Need to launch in 6-8 weeks, not 12-18 months. Speed to revenue more important than minimizing unit costs.
BPO economics heavily favor 5-500 agent range. Save 60-75% vs in-house with no upfront capital.
Contact volume fluctuates 30%+ seasonally or unpredictably. Need flex capacity without layoffs.
Can't invest $500K-$2M upfront in facilities and infrastructure. Prefer OpEx over CapEx model.
Customer support isn't your strategic focus. Want to focus resources on product, sales, engineering.
Launching new product line or market. Want to test demand before building permanent infrastructure.
BPO brings proven processes, technology, quality monitoring, workforce management that would take years to build.
The Hybrid Approach: Best of Both Worlds
Many companies use a blend of in-house and outsourced resources
Common Hybrid Models
Core In-House + Overflow BPO
Keep core team in-house for baseline volume. Use BPO for overflow, seasonal peaks, after-hours.
- • In-house handles 70% steady-state volume
- • BPO handles 30% peak/overflow
- • Avoids hiring/firing with volume swings
Tier 1 BPO + Tier 2-3 In-House
Outsource high-volume Tier 1 support. Keep complex Tier 2-3 escalations in-house.
- • BPO handles 80% of volume (simple queries)
- • In-house experts handle 20% (complex)
- • Best cost/quality tradeoff
Geographic Split
In-house for domestic/high-value markets. BPO for international or lower-tier segments.
- • In-house: US enterprise customers
- • BPO: SMB, international, freemium
- • Match cost to customer value
Start BPO, Build Later
Launch quickly with BPO. Build in-house once you achieve scale (500+ agents).
- • Year 1-2: 100% BPO (fast launch)
- • Year 3: Transition 50% in-house
- • Year 4+: 80% in-house, 20% BPO flex
- Flexibility: Scale BPO up/down without impacting core team
- Risk mitigation: Not dependent on single vendor or approach
- Optimize costs: Use right resource (expensive vs cheap) for right task
- Competitive benchmark: Compare in-house vs BPO performance continuously
Build vs Buy FAQs
Is it cheaper to build an in-house call center or outsource?
Outsourcing is 60-75% cheaper than in-house for operations under 500 agents:
- • In-House 3-Year Total: $5.8M-$8.8M (including $350K-$950K upfront)
- • BPO Offshore 3-Year Total: $1.3M-$2.4M savings of $4.5M-$6.4M (73-78%)
- • BPO Nearshore 3-Year Total: $1.7M-$3.3M, savings of $4.1M-$5.5M (63-71%)
Break-even point: In-house becomes cost-competitive around 500-750 agents when you achieve economies of scale. Below that threshold, BPO is significantly cheaper due to shared infrastructure, offshore labor arbitrage, and no upfront capital requirements.
How long does it take to build an in-house call center?
Building in-house takes 12-18 months vs 6-8 weeks for BPO:
- • Months 1-3: Facility planning, real estate, leadership hiring
- • Months 4-6: Infrastructure setup (IT, phones, furniture)
- • Months 7-10: Mass recruitment, training program development
- • Months 11-12: Pilot launch, initial production ramp
- • Months 13-18: Full production, quality stabilization
- • Weeks 1-2: BPO selection, contract, requirements
- • Weeks 3-4: Recruitment, screening by BPO
- • Weeks 5-6: Training, tool setup, integration
- • Week 7: Pilot with limited volume
- • Week 8+: Full production
Time-to-value: BPO delivers 3-4x faster launch, critical for time-sensitive product launches, seasonal ramps, or competitive response scenarios.
What are the hidden costs of building an in-house call center?
In-house operations have numerous hidden costs beyond salaries:
- • Attrition & replacement costs: 30-50% annual turnover = $3K-$5K per replacement × 10-15 agents/year = $30K-$75K annually
- • Management overhead: Need supervisors (1:15 ratio), QA team, workforce planners, trainers = +30-40% of agent costs
- • Technology refresh: Equipment replacement every 3-4 years, software upgrades, security patches = $50K-$100K/year
- • Compliance & legal: Labor law compliance, HR administration, benefits management = $25K-$75K/year
- • Facilities maintenance: Repairs, cleaning, security, utilities increases = $20K-$50K/year
- • Idle capacity costs: Paying for seats during slow periods that BPO could flex down
BPO rolls all these costs into the hourly rate - no surprises, no hidden expenses.
Can I start with a BPO and move in-house later?
Yes, this "start BPO, build later" approach is very common:
- • Year 1: Launch with BPO (5-50 agents). Fast time to market, no upfront capital. Focus on product-market fit, not operations.
- • Year 2: Scale BPO to 100-200 agents. Prove business model, establish processes, learn what works.
- • Year 3: Evaluate in-house economics. At 500+ agent scale, cost curves favor in-house. Begin transition planning.
- • Year 4: Build in-house facility while BPO continues operating. Gradual transition of 50-80% volume in-house.
- • Year 5+: Keep BPO for overflow/flex capacity (20-30% of volume) while core in-house.
Key benefit: De-risks launch. You validate business model with BPO before committing $500K-$2M to build in-house. Retain BPO for flexibility even after building.
What are the risks of outsourcing vs in-house?
Both models have distinct risk profiles:
- • Capital risk: $500K-$2M investment before serving first customer
- • Execution risk: 12-18 months to launch = delayed revenue
- • Attrition risk: 30-50% annual turnover disrupts quality
- • Fixed cost risk: Pay for seats even if volume drops
- • Expertise gap: Takes years to build BPO best practices
- • Quality variability: Less direct control over agent quality
- • Vendor dependency: Switching BPOs is disruptive (6-12 weeks)
- • Data security: Sensitive customer data with third party
- • Cultural fit: Offshore agents may lack brand immersion
- • Hidden fees: Some BPOs have setup fees, tech fees (not Globalify)
Risk mitigation: Start with pilot (5-10 agents, 3-month contract), establish clear SLAs, maintain hybrid model with some in-house capacity for critical functions.
How does Globalify make build vs buy easier?
Globalify's flexible model eliminates most BPO downsides:
Start with 5 agents, scale to 500+. No upfront capital required. Month-to-month flexibility after initial term.
Offshore (India, Philippines), Nearshore (LATAM), Onshore (USA). Mix locations to optimize cost vs quality tradeoffs.
Analyze 100% of interactions (not 1-5% sampling). Achieve in-house quality levels with offshore costs through technology.
Real-time dashboards, quality scores, agent performance. More visibility than most in-house ops.
Use our cost calculator to see exact costs. No hidden fees, no surprises. All-inclusive hourly rates.