Make Money Being “the office” for a Small Business

PCS Online Solutions contributed to this article.

There are a lot of businesses that need an office, but cannot afford full time staff.  They need someone to answer the phone when they are driving or during off hours.  They may need someone to send out marketing materials, manage their website, handle the mail, do some bookkeeping, and make sure the bills are paid.  So you might ask, why not just hire someone?  Well the business owner may not have time to manage someone, and she know that if she actually hired an employee, she would have to pay by the hour and there would be a ton of paper work, she would have to deal with payroll taxes, unemployment insurance, providing office space, workers comp etc, health insurance, legal issues involved if an employee needs to be fired …  Would it be worth it to have someone do about a couple of hours of office work and answer four or five calls a day?  For a large business, it would be cost effective to take on an employee, but for a small business, it’s just not worth it.  Small businesses need the flexibility and they are willing to pay for it.

This business started out as the answering service, but now with big switchboards and a group of ladies taking messages on index cards.  A lot of people thought it would be wiped out when the answering machine was invented in the 1970’s and all the important messages were stored on a tape.  But it did not go the way of the photo processing shop.  People needed to hear a real voice at the other end of the phone.  And now with broadband, VOIP, call forwarding … it’s possible to run this business from a small office our out of your home.

According to research done a few years back by our contributor, PCS Online Solutions, there are hundreds of husband and wife entrepreneurs who, beginning with just a couple of thousand dollars in borrowed funds, and a lot of ambition are grossing $250,000 or more after a couple of years in business.

Why would anyone pay you to answer the phone?

(1) People Hate Phone Systems  Even though a small business can get the same system as a big company today, the old style answering service more as relevant today as ever. People hate these things. 

Push 1 for English, Push 8 for this department, push option 3 to leave a message for someone who has been fired but we don’t know how to remove him from the system. The ones with voice rec are actually worse.  Okay, I didn’t understand that.  I’m sorry I have a really annoying computer voice and I will am not capable of understanding what you want.  And when you hang up you realize the lady next door heard you say “I WANT TO TALK TO A F**ING PERSON.  A  P-E-R-S-O-N.  YOU F***ING MACHINE.” Then you realize the lady next door heard you.  This not too funny to the business owner, because she knows you will just call a competitor.  Exasperation of this kind can sometimes cost a business person thousands of dollars in lost profit.

(2) And there is a certain segment of the population that cannot wait for the beep.  They need to talk to someone now.

(3) Advertising is Expensive.  People have tons of phone numbers to call if they have looked up a business.  They will just keep calling until they talk to a live person who can set up an appointment.  If the firs three businesses they call have voice mail, the fourth business that has a friendly voice say “we can help you with that, let me send a guy out to look at your problem” will get the job.

(4) The business owner does not have time to deal with telemarketing calls all day long.  So the Office Outsource Contractor screens the calls and saves the business owner a lot of time.

Realizing this, today’s successful business person wants the personal touch of a friendly, professional “secretary” answering their phones.  

The Office Outsource Contractor can handle several businesses.  For instance, a plumber on line 1, a real estate agent on line 2, and a sales man on line 3…. She/He  can pass along the proper messages to the different callers, take messages, screen calls, get clarifications and even make appointments.  And this can be done from home.  None of these three businesses could hire a full time staff person to handle the calls, but a contractor can spread out the costs by handling several businesses.

Other Business Services

The business owner may also want the Office Outsource Contractor to handle other businesses.  Just think about what happens in an office, and you can get an idea of what a small business owner might need.

  • process the mail from a PO Box, and pay the bills, enter customer orders into a computer system, scan mail and faxes and send to the client via e-mail.
  • provide a fax number
  • Billing Services
  •  Marketing– send out targeted marketing materials in the mail or run a internet based advertising campaign.
  • personal assistant who handles  personal and business schedules (this is referred to as a Virtual Office Assistant)

To get started, you’ll need an initial investment in equipment and facilities, plus working capital.  You may already have a lot of the equipment you need: computers, high speed internet, an extra PC, and space in your home or office.  There are software packages available that that allow you to do everything form one platform.  No more note pads or 3×5 cards are necessary.  Just search answering service software to see what’s available.

Low Start Up Costs

You need a computer, VOIP device and a good internet connection and some office furniture.  Exclusive of marketing costs, you could set up this business for less than $5,000.  You may also want to rent an office to show your clients that you are professional.  But since you can connect your VOIP service to any computer, you could run this out of you home if you did not want to go to your office.

 Answering Service Software (TAS)

New Software allows you to rout calls through your computer.  You can talk to the customers, set up appointments, and send an e-mail to the business owner.  One company that has been around for since 1986 is Mastar   They offer a software application to handle all your needs.  The main advantage of the software is that you can charge your clients per minute for the time you spend talking to their clients.  It seems like these systems are going out of style.  A couple of years ago, there were several systems being marketed, today their does not seem to be many out there.

That’s because other companies are making the software packages irrelevant.  For instance, a VOIP company like Vonage you can have several lines forwarded to your number.  Or you can add a separate phone number onto your Vonage account for $5.00/month.  And you can use free calendars, and e-mail programs to communicate with your Business Owner Clients.  So it’s not clear that you need to spend a lot on a system when you can hobble together stuff that’s virtually free.  The advantage of Vonage, and other VOIP systems is that you can have a phone number in any area code you want.  This is great for a client who is doing business say in Riverside, and wants people to call into a “local” number to set up an appointment.  If the business owner’s 949 number is in the ad, not too many people from the 909 will call.  The VIOP service does not charge for incoming calls, but keeps track of who called so you can bill your client.

Finding Customers

The biggest challenge to having a successful business is customer acquisition.  PCS Online Solutions suggests that in the beginning, with a 2 person operation, you can have your operator selling by phone while you make in-person sales calls.  You might also want to add a couple of “hungry” commission sales people to help line up a good list of accounts as fast as possible. These efforts will take planning and coordination because you won’t want two different sales people calling on the same prospect.  

Potential Customers include:

  • Contractors
  • Salespeople
  • Doctors
  • Businesses that close but still want to take calls after hours
  • Attorneys
  • Business people who travel and need someone to take care of things when they are out of the country
  • People running a part time business while they are employed
  • Real Estate Professionals and Investment Professionals.
If you have any expertise, you will want to target customers in a particular industry.  Perhaps advertise in their local trade magazines, join their local trad associations, and target them on google ad words.  Although it is not necessary, you may want to focus on local companies.  You have an advantage if you know the area and sound like you are a local.  People can tell.  If you have a client in Boston for instance, all of his customers will know you are not a local.

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Office Outsourcing big hit overseas

After we wrote this story, we noticed a bunch of people providing this service.  They happened to be located in the UK.  You might want to check out their websites.   We found three examples:  Example 1, Example 2 , Example 3  It seems like the term Answering Service is used more in this country, but the term Office Outsource is more relevant if you want to get into more than answering the phone.

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According to our contributor, the average rates to charge for your service should be about $35 per month for a specified number of calls–usually 70 to 75–with a surcharge of 25 cents for each call beyond that number. Other calls such as “wake-up” and reminder calls for appointments are usually billed on a “per call” basis at about 50 cents per call.  [Check these numbers are a bit old.]  We saw rates starting at around $90/month.

Your Contract

Since there is no basic contract, you want to make sure the contract you design for your clients has these elements:  Each time a customer “signs” for your services you should have him/her sign a simple contract that specifies the name and address of the firm to be billed for the service.  There should also be space on this contract for alternate phone numbers, names and addresses as well as phone numbers of persons to contact in case of emergency, and any special answering instructions the client may want you to use. Don’t forget to include a clause requiring 30-day notification of service cancellation by either party to the contract.  You’ll probably want to stipulate that the last month’s base charges are to be paid at the time of service approval, in order to enhance your working capital situation.  You are not responsible for lost business because of missed calls …

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Customer Service Outsource

There are many companies that choose not to pay for a large central call center.  They just rout customer service calls to someone’s home or office.  The person you are talking with does basic tec support or customer service.  Many times they follow a script on the computer.

One company that contracts with larger firms to do this is Alpine Services.    jobs.alpineaccess.com  They focus on people who are at home, have computer skills and who are good on the phone.  You have an on-line training class before you start working.  Editor’s Note: Thanks for adding this, but it looks like California’s labor regulations win again, this company currently does not offer opportunities in California; but do have opportunities in most other states and all of Canada.

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