What is the true cost of a receptionist?

What is the true cost of a receptionist?

The aim of this article is to analyse the true cost (and benefit) to an employer of employing a receptionist. It is important to understand this cost/benefit scenario in order to make an informed decision regarding the use of a call answering service provider like Paperclip. Whilst in-house reception costs are not the only factor in the decision-making process, they undoubtedly play a key role in the economics of the decision.

It is recognised that the traditional front-desk receptionist is no longer the norm for many organisations, and that reception duties are often shared across a number of members of staff. However, the same economic argument applies regarding additional reception resource.

Full divert and delayed divert

For some of its clients, Paperclip provides full reception services. Full reception service means all the client’s incoming calls are diverted through to the Paperclip communications centre. This is referred to as a ‘full divert’.

For other clients, Paperclip answers those calls that the client’s receptionist is unable to answer within a period of, for example, fifteen seconds. This is a ‘delayed divert’. A receptionist may be unable to answer a call for any number of reasons including receiving multiple incoming calls at the same time, comfort breaks, being tasked with a ‘non-reception’ activity and so on.

In the case of a Paperclip client operating with a delayed divert, the question isn’t whether to employ a receptionist it is whether the cost of employing an additional receptionist can be justified. In economics, this would be referred to as the cost of employing the ‘marginal’ receptionist.

The cost of employing a receptionist: assumptions

To arrive at an estimated cost, we have made the following assumptions:

The receptionist

• is salaried
• is paid at a rate of £11/hour
• works Monday to Friday
• works 8.5 hours per day, inc. one hour for lunch
• receives 20 days holiday
• receives a 5% pension contribution their employer
• incurs National Insurance costs for the employer based on the rates in force from 6 April 2023 (https://www.gov.uk/national-insurance-rates-letters)
• in their first year has two days of onboarding and ten days of training charged at £200/day
• requires a computer, IT support, software licences and associated set-up costs estimated to be £2,250 in total

When the receptionist is away from their post, we have assumed they are replaced by an employee of equivalent pay and benefits. We have made the following assumptions regarding the receptionist’s non-availability:

• 20 holiday days
• 5 sick days per annum
• Hourly rate for cover is calculated from ‘Salary + National Insurance + Pension’ divided by 256 (days) = £108/day

We have not included any recruitment costs, share of general overheads, time commitment from a line management perspective, or cost of cover for lunch breaks, comfort breaks and ad-hoc non-availability.

The cost of employing a receptionist: the calculation

Given the assumptions detailed above, the nominal annual cost of employing a receptionist works out as follows:

Cost Category	Units	Unit Cost	Total
Salary			£24,242
National Insurance			£2,242
Pension			£1,212
Sick Days	5	£108	£540
Holidays	20	£108	£2,160
Computer, IT Support, Software Licences etc			£2,250
Onboarding and Training	12	£200	£2,400
Total			£35,046

 

It is recognised that employment costs vary considerably across the country. However, we believe the calculation as laid out above is a prudent estimate of the first-year employment costs of an experienced receptionist.

The benefits of employing a receptionist

Paperclip is an advocate for experienced, skilled and trained receptionists, regardless of whether they are directly employed or whether they work for Paperclip. It is a skilled job that requires excellent communication skills, including the ability to listen to callers in a non-judgemental manner.

Receptionists set the tone for a caller’s perception of the organisation they are interacting with. In many organisations, callers will include existing and prospective customers; you don’t get a second chance to make a first impression.

Depending on the reception (call answering) workload, a receptionist may be able to undertake additional tasks. Over time, as the receptionist gains a more detailed understanding of the products and services provided, they can often deal with many of the FAQs that callers may have.

When we initially speak with new Paperclip clients, it is clear that employing a receptionist also has a societal dimension to it, in other words it is perceived to be the ‘way things are done in business’.

The downsides of employing a receptionist

During and post-Covid, Paperclip has experienced a substantial growth in new client instructions. In parallel with this, our recruitment costs have soared. Finding and retaining employees with strong receptionist skills has undeniably become more expensive.

It is a given that the primary function of a receptionist is to answer incoming calls; the phone remains probably the most important commercial communications channel for many businesses. However, as Paperclip can attest, calls don’t arrive in a nice, even flow. There are peaks and troughs and, in many businesses, seasonal influences to call volumes.

As a society we are becoming ever more impatient, and callers are less likely to take kindly to waiting for their call to be answered or being put on hold. Consequently, the receptionist will occasionally miss an incoming call (see the Paperclip article, ‘The true cost of a missed call’: https://www.paperclip.co.uk/missed-call-cost/). This scenario is exacerbated if the receptionist is tasked with other duties that compromise their ability to answer the phone.

The call answering alternative: Paperclip

When deciding whether to employ your first or ‘marginal’ receptionist, it is worth investigating the option of using a third-party reception service such as that provided by Paperclip.

When an incoming call to your business is diverted to Paperclip, the Paperclip call handler’s screen ‘pops’ with your details. When they are answering your call, the Paperclip call handler truly is part of your team.

When you are onboarded as a Paperclip client, we will work with you to ensure you get the most from our services. For example, not only can we take and transfer calls and take messages, we can also answer FAQs, take payments over the phone, enter data directly into your CRM, make bookings and appointments, and much more besides.

If you select the ‘Pricing’ option on the Paperclip home page menu bar you are taken to the Paperclip Quotation Generator: https://www.paperclip.co.uk/quotation-generator/.

The Quotation Generator allows you to build an estimated monthly (and annual) cost for using Paperclip’s reception services. The Quotation Generator’s results panel updates automatically as you change your parameters.

Case study – Should I employ another receptionist?

Let’s take an example. Let’s assume your business is a regional law firm. You already have a pool of three receptionists but recognise that call volume fluctuations mean you are missing a significant number of calls. This is particularly true during the holiday months when the receptionist team is often down to two or even one.

You have checked the data captured by your phone system and realise that, on average, you are missing 30 calls a day. On average, phone calls last two minutes and the receptionist team typically transfers 40% of incoming calls to a fee earner or other member of staff.

The Quotation Generator calculates it would cost your business £1053.60 per month (£12,643.20 per annum) to employ Paperclip to answer these calls.

From earlier in the article, you will recall that the annual employment cost of a new receptionist is around £35,000.

Using the Paperclip Quotation Generator you can calculate that it is only when Paperclip answers your 90^th call per day that you reach break-even. It is important to remember, however, that this is only a mathematical break-even point. Many of the 90 calls will have been received simultaneously, requiring the services of multiple Paperclip call handlers. Effectively, if you had recruited an additional receptionist, you would still have missed calls at times throughout the day.

We make it easy and straightforward for you to trial the Paperclip reception service option

The Paperclip reception service promise is ‘professional, tailored, affordable’.

With Paperclip you only pay for the call minutes you use. Some providers use a ‘call bundling’ pricing structure where you buy a fixed number of calls each month, regardless of whether you use them or not.

Paperclip’s contractual terms are based on a rolling 30-day contract period. There is no pressure to commit to an annual contract or longer. At Paperclip we retain our clients through quality of service rather than contractual niceties.

As you can see from our Quotation Generator, Paperclip believes that enduring client relationships are built on trust and transparency. It’s not a word that is used often in business, but our clients enjoy working with us. We believe you will too.

First steps

For an open discussion on the challenges facing your business and the possible ways Paperclip may be able to help, please call me on 01246 41818.

We look forward to your call.

 

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