What Does In-House Customer Service Cost for E-Commerce Companies?
- Peak Support
What Does In-House Customer Service Cost for E-Commerce Companies?
Retail and e-commerce companies who want to offer quality customer service face a choice: manage it in-house or outsource it to a customer support team?
As with most important business decisions, costs are a critical factor to weigh when navigating the choice of in-house versus outsourced customer service. Many companies make the mistake of considering salary and benefit costs alone. In reality, building a support team in-house involves a number of hidden costs, which include everything from recruiting and training to infrastructure and scheduling. All these add up to a hefty sum for a function that may not be core to the business.
In comparison, outsourced partners, such as BPOs, consolidate these costs into a single, predictable expense, which typically works out to be lower—all while providing access to experienced customer service professionals.
Here are the major expenses (besides pay) to consider when calculating the full cost of providing customer service in-house.
Hiring Costs
To provide great customer support, you obviously want to hire the most qualified agents to represent your brand. For the hiring process, you have to consider not only the salary cost, but the cost of time spent in identifying, interviewing, and recruiting this talent. You may need to dedicate a part of your human resources team to manage this.
Talent acquisition can rack up a sizable bill even before the agents step foot in your company. Furthermore, the customer service industry typically has very high employee turnover and every agent lost is a cost in and of itself.
For retail and e-commerce companies based in large cities, finding top-tier customer service talent locally can be a challenge. As your team grows, you may need to expand your search across state lines or internationally—adding cost and complexity that your HR team may not be equipped to manage. Outsourcing specialists, by contrast, have a competitive advantage that makes it more cost-effective to recruit customer service agents. At Peak Support, for example, we continually engage with top talent in the industry, and can easily bring on new people whenever clients require it. Our website attracts thousands of visitors looking for customer service jobs and we additionally get frequent referrals from our existing agents.
Training Costs
Poorly trained customer support staff can misrepresent your brand, contributing to lost sales – another major often overlooked cost to consider. As such, it’s imperative to create a training program in which the agents are taught not only the ins-and-outs of the product they will be servicing, but also, the company’s core values and policies, customer service best practices, and more. Training programs have to be periodically updated as the company evolves.
The time and money invested in creating these training programs is non-refundable. In comparison, customer service outsourcing firms can rely on their experience to create appropriate training modules quickly and efficiently. Plus, training programs are continually updated to keep up with latest industry trends and remain in compliance with changing regulations.
Infrastructure Costs
If you’re hiring customer service in-house, you need office space, desks or workstations, headsets, phones, computers, and more. The real estate costs alone can be prohibitive, particularly for smaller companies.
As of 2025, the average monthly rent for office spaces in the U.S. was reported as $33.34 per square foot. These rising costs run much higher in large metropolitan areas such as Miami ($56.53 per sq. ft.), San Francisco ($64.19 per sq. ft.), and Austin ($45.90 per sq. ft.). Even a modest office space could end up costing you thousands per month with added costs for utilities, maintenance, insurance and taxes. More people also means the need for more space, which can lead to increasing costs as your team grows and scales to meet your growing ecommerce support needs.
Outsourcing ecommerce customer service eliminates the burden of these significant overhead costs. These savings are especially impactful for fast-growing ecommerce brands trying to scale without investing heavily in in-house infrastructure.
Inefficient Staffing Costs
Inefficient staffing and scheduling can be a huge hidden cost. If your agents are idle for hours each day, you’re wasting money. But you need to ensure you have enough coverage at peak times.
Companies that have inefficient staffing are at risk of either providing sub-par service because they’re understaffed at key times and/or actually hiring more agents than they actually need.
Outsourcing companies rely on their expertise to get the right shift schedule for each company. Using our queuing model, for example, Peak Support can determine the precise number of agents required for each shift, based on your desired response time and constraints.
In-House vs. Outsourced Customer Service: Which Is the Right Fit?
When you factor in the full cost of building an in-house ecommerce customer service team—hiring, training, salaries, benefits, office space, equipment, and ongoing management—the expenses can quickly add up. Outsourcing to a trusted BPO partner like Peak Support not only reduces those overhead costs but also gives your brand the flexibility to scale up or down based on demand, seasonal shifts, or rapid growth—all without sacrificing the quality of your customer experience.
Just look at Public Rec, a cult clothing brand and ecommerce company that partnered with Peak Support to build a strategic, scalable customer support solution. With a team of experienced agents and tailored services, Peak Support helps ecommerce brands deliver world-class service while staying within budget.
Want to see if Peak Support is the right fit for your business? Reach out today to learn more.
