In-House vs. Outsourced Customer Service: Pros and Cons


Irrespective of the kind of business you own, it is paramount that you maintain a high-quality customer service team. 

Businesses that pivot around great customer services are the ones that enjoy maximum growth.

This was proved when Microsoft polled 5,000 people around the world, out of which about 96% claimed that customer service is a major director of loyalty towards a brand.

Having said that, when you receive a huge number of customer phone calls that exceed your network bandwidth, you probably consider delegating this responsibility to a third-party customer service company. 

Then again, you might wonder, “Should I go for an In-house Call center or an Outsourced Call Center?”

This article will guide you through the pros and cons of incorporating an In-house customer service and an Outsourced Customer service team.

In-house vs Outsourcing Pros and Cons

Pros and cons of in-house and outsourced customer service

Before diving into the pros and cons of in-house customer service and outsourced customer service, let me first help you understand what they mean. 

An In-house call center – implies that you assign a team that operates under the same roof as you do and will be within the vicinity of various departments in your company. Thus, they will use your company’s assets and you will be bearing the brunt of their expenditures. 

On the contrary, an outsourced call centermeans that you hire an external organization or team to carry out the day-to-day customer service-related activities for your company. This team will be using its own assets and infrastructure to operate.

Having understood what the two terms mean, let us now go through each of their pros and cons to determine which one would be beneficial for your organization.

Pros and Cons of In-House Customer Service

While choosing an apt customer service team for your organization, an in-house team might feel impelling because you would be able to monitor them and keep a check on their activities. But it can also break your bank.

Also, there are other aspects like cost analysis, infrastructure requirements, and so on, that you need to consider before making a decision. 

Tip: “Try relating to your company requirements and needs while you go through the pros and cons mentioned hereafter. This will help you determine which one is best suited for your organization.

Pros of In-House Customer Service:

Better company knowledge:

Established close to the product and development department, the in-house team will have a good grasp of the products and services provided by your company. 

Moreover, being in regular contact with numerous departments, the in-house call center will have a good hold on the uniqueness of your company, helping them in handling product-related customer issues with ease. 

Better policies implementation:

Changes in company policies might be cumbersome but are necessary as well.

Being a part of your organization, the in-house team will be well versed with the company policies and would relay them to your customers fluently. 

Quick technical support: 

Time is of the essence in today’s fast-paced world. Your customers want an immediate solution to their problems which is also one of the biggest advantages of an in-house team.

Being integrated into the company’s network, they can easily communicate with your technical developers and work out a quick solution, rather than issuing tickets and booking appointments for your customers to interact with your technicians.

Better coordination:

As we know, communication is the key to better coordination

And an in-house team would stay in touch with different departments of your company and thus encourage better coordination within your company. This smooths the flow of information and thus, ensures the better provision of services.

Thus, incorporating an in-house team is not short of benefits. However, every good thing also has a negative side to it.

Discussed below are some insourcing disadvantages.

CONS of In-House Customer Service:

Costlier than outsourcing:

The biggest factor that you should consider while taking any business-related step, is its requirement of capital.

Frankly speaking, when you incorporate an in-house call center, you end up facing the brunt of all the unavoidable expenditures (equipment, infrastructure, training programs, salaries, incentives, etc.)

On the other hand, you can delegate your customer service to another specialized company within a few hundred dollars.

Downtime for support:

Does your company operate 24×7? Most likely not. 

So your in-house customer service team would also follow the company timings. Or you would be required to hire an additional team to operate out of your business hours, which might be nearly impossible for you.

This means your customer service team will not be able to serve your customers who face a problem outside your company business hours. 

This could lead to unsatisfied customers who might want to take their business elsewhere.

Takes valuable time:

Incorporating an in-house team means you need to spend that much time monitoring them, dealing with their issues, and performing repetitive tasks. 

This is precious time that you could have used to develop your products or work towards increasing revenue for your company.

I reckon you now have mixed thoughts about whether or not you should be insourcing the customer service team.

Well, let us go through the pros and cons of outsourced customer support to determine what works better for your company.

Pros and Cons of Outsourced Customer Support


An outsourced customer service team acts as an extension of your company that handles your customers’ issues on their own and can also redirect your customers’ queries towards the right officials within your company. 

Thanks to recent advancements in the outsourcing niche, by hiring a third-party customer service team, you can save a lot of time and capital that you can invest towards developing your business. 

Let’s have a look at the pros of outsourcing:

PROS of Outsourced Customer Service:


Outsourcing costs are surprisingly low compared to in-house call center costs. 

That’s because outsourcing companies specialize in utilizing their own infrastructure and equipment, charging you a minimal price.

According to a survey, 70% of companies opt for outsourcing as a means of cutting costs.

24/7 customer support:

Outsourced call centers often operate 24/7, and can provide round-the-clock service to your customers. 

And in today’s customer-centric era, it’s crucial for you to provide customer service 24/7.

In fact, 90% of customers rated an immediate response as necessary when they have a customer service question. 70% of the customers rated that ‘immediately’ means less than 10 minutes.

Thus, outsourcing your customer service could help your company gain loyal customers.

– Experienced customer service agents:

Outsourced customer service teams excel in catering to the needs of a customer and are well versed in the best communication methods to establish a bond between your company and the customers.

Simply put, you will be hiring professionals who work with the same empathy and care that any insourced team would.

Better response time:

In a survey conducted by the CMO Council, 75% of customers prioritized better response time as one of the primary measures of customer satisfaction.

Outsourced Call centers, being specialists in the customer service niche, can ensure you better and faster response time compared to insourced call centers. 

Better technology and resources:

Outsourced teams are equipped with the latest communication tools and resources, dedicated solely to improving communications with your customers. 

Outsourced customer support agents would have access to training materials and programs that inculcate customer-friendly practices for providing a high-quality customer experience.

Improved focus on important tasks:

Customer service is important but it doesn’t require continuous attention of your management professionals and can be delegated.

When you outsource a customer support team to take care of the repetitive tasks of your call center, you free up your calendar to focus on important tasks like business development, marketing, and management-related endeavors.

CONS of Outsourced Customer Service:

Limited company knowledge:

We can’t deny that – No one knows your company and your customers better than you.

A third-party customer service team may not have specific product knowledge, unlike an in-house team. This lack of knowledge about your company could hinder the provision of adequate customer solutions.

However, you could always relay your product information to the outsourced team, but there is no guarantee that every representative in the customer service team will be able to understand and interpret this information.

Security concerns:

Outsourcing means you will have to share your customers’ personal information with a third-party company, which can be a thing to consider as privacy is a major issue in the present-day scenario. 

According to Helplama’s US customer service survey, 46% of consumers who experienced insecure handling of personal information, ended the business relationship with a company.

However, certain companies partner with security and trust-seal providers to ensure that the personal information of customers is safe and secure.


Thus, as mentioned in this article, pros and cons are inevitable whether it is an in-house or outsourced customer service team. You now know what your options are.

Align this article along with your company’s budget, requirements, and niche of business to determine what customer service option would be best for you.

However, if you’re a small business with a limited budget, we would suggest you delegate your customer service to Helplama, a new-age US-based customer service provider that will not only provide you with experienced customer service professionals within a few hundred dollars but will also ensure you high-quality customer service.