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How to Calculate Answering Service ROI

How to Calculate Answering Service ROI

Using an Answering Service Offers a Great Return on Investment

Many managers make the mistake of looking at an answering service based on its cost. Instead of an expense, however, the wise approach views an answering service as an investment and calculates its return.

This is called return on investment (ROI). To calculate ROI, take the revenue generated by the investment and divide it by the investment and then multiply this by 100. This produces a percentage, with the higher the amount, the better the investment. Doing so recasts the answering service as a critical revenue provider for your company, instead of an expense that must be managed.

Here are the key factors to consider when looking at answering service ROI:


Does your answering service take phone orders for you? They should. Whether you sell a product or a service, some people will place phone orders for them. Even if your website handles this, some customers will have questions, encounter problems, or feel more comfortable talking to a person about the transaction. Your answering service can help them.

Let your answering service take these orders directly and offer phone support for those ordering from your website. The dollar amount of each phone order your answering service takes and the dollar amount of each order they assist in should be used to calculate ROI. Add these numbers together for the entire month and that represents the first element in determining the return for your answering service investment. Without your answering service, none of these orders would have happened; the revenue would be unrealized.


Also, your answering service should be equipped to set appointments for your sales team. People may inquire about your company’s products or services at the strangest of hours, whenever they have time or the thought comes to them. At a minimum your answering service can take this information. Even better is for them to schedule an appointment for your staff to follow up with the caller, either over the phone or in person.

What is the dollar volume generated by each one of these appointments? Add these numbers up for the month, and they become the second element for your ROI calculation. Again, your answering service plays an essential role in these appointments being made and in allowing the results to occur.


The goal of your marketing initiatives is to generate business for your company. When someone completes an online form, sends you an email, or places a phone call for more information, your answering service is often the one to receive this information. These are leads.

While your answering service may turn some of these into sales when they take in order or set an appointment for your sales team to follow up with, other times they will simply record the prospects’ contact information. As these leads are worked by your staff, sales will result.

The sales made from these leads become the third source of revenue for you to consider in your ROI determination. Without your answering service, these leads would be in jeopardy, as they might never be captured in the first place.

New Customers

Every call your answering service handles from someone other than an existing customer, represents potential new business. Each call could be a future new customer. What is the average lifetime value of each customer?

For every new customer whose journey starts with your answering service, assign the lifetime value that these customers represent as the fourth revenue source in your ROI calculation. After all, without your answering service, these customer journeys would have never started.

And More

Your answering service also plays a significant role in other business-enhancing tasks. Though these are harder to measure, they benefit your business greatly. These include enhancing customer service, retaining business by keeping customers from going to your competition, and bolstering your brand reputation as a responsive, always-on business.

Each call your answering service takes contributes to these three outcomes. By assigning a dollar amount for the value of each of these results, you rightly factor their contribution into your return on investment analysis.

Add these five elements together and divide them by your answering service’s monthly invoice. Then multiply it by one hundred. This is the return on investment for your answering service.

Most businesses regularly have a triple-digit ROI from their answering service investment. Some enjoy even more. In any event the ROI analysis will show that the revenue generated through your answering service’s efforts will greatly exceed the small amount of money you pay them each month for their services.

Richard L. Hutcherson is the director of operations for Answering Service One, a new kind of answering service that wants to become your number one resource to handle your communication needs. Contact Richard at 865-505-0456. Peter Lyle DeHaan is a freelance writer from Southwest Michigan. Check out Answering Service One to see if they’re the right answering service solution for your business.

  • By: admin
  • On: February 05, 2019
  • In: Blog Post
  • Comments: 0 Comment

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