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Stop Being A Cost Center And Watch Your Business Boom

by Rupen Fofaria, Kommit and Company - July 24, 2018

Stop being a cost center and watch your business boom.
 
 
·         Price-based customer service leads to business becoming a commodity player with weak relationships and shrinking value
·         Find ways to move from a cost center towards a profit center by providing key revenue-generating actions for your clients
·         Hire Kommit & Company, to help make this transition and position your company for an optimum exit.
 
 
At the closing of our most recent transaction, the buyer looked across the table and said openly, “If I could find more call centers that knew what these guys know, I’d buy them all.” If the all-cash and high-multiple price hadn’t put a big enough smile on the face of our sellers, that statement certainly widened the grin. What the buyer didn’t know was that we had started working on our plan about a year before that day.
 
At Kommit & Company, we help call center owners optimize their business and ultimately position them for maximum exits. A primary strategy (and secret ingredient) for driving valuations higher is coaching owners on how to move from the expense side to the revenue side, and deliver profitable interactions to their clients time after time.
 
The days of providing a warm body to answer a client’s 800 number and offer some quick and basic interaction or problem solving after hours (and getting paid for it!) are long gone. With the globalization and automation of more and more advanced customer service interactions, each and every first-call resolution and first-rate experience call center has to rethink how it does business.
 
Our recent client exits have shown clearly that by leveraging a Sales Through Service model, centers that help clients realize value from service channels with newfound sources of income are far easier to sell and garner significantly higher multiples than those that rely solely on a price per outcome or a per-minute model.
 
We have worked with clients in a number of ways to implement these strategies, such as adding revenue-producing components to service calls, asking clients in quarterly or annual reviews for areas of revenue generation in which you can assist, and seeking to reactivate old customers for your clients.
 
Eleven times out of ten, a call center can staff revenue-generating positions faster, cheaper, and better than their clients, and develop incredibly strong relationships with the improved revenue flow, leading to deeper bonds and more center-friendly contracts.
 
With our guidance and coaching, these strategies pay handsomely in exit multiples downstream by improving both current center revenues and making way for stickier client relationships. Our recent deployed strategies have been varied, for instance:
 
§ One large client had a myopic focus on management strategies to keep Average Handling Time (AHT) low, as a lower AHT ensured optimal staffing and lower cost-to-serve. However, in pursuit of keeping the AHT and cost low, the contact center was missing out on a huge opportunity to problem solve, develop trust with the caller, and cross-sell other products on behalf of their client. With our methods, the call center was able to consistently and significantly deliver their client incremental sales and dramatically lower the cost of serving their client.
§ Another client was looking to increase agent utilization during slow times. We suggested contacting his clients and offering a reactivization campaign at a lower than standard rate with a revenue share component. This call combined list cleansing, sales reactivization and two survey questions, all leading to fresher client data and new sales. 
§ One of our clients began a brand ambassador program, calling new customers within 30 days of receipt of product to help customers with usage questions and asking about marketing and packaging – while also offering discounts on additional orders. The program has been a huge success decreasing returns and more than paying for itself with increased revenue in just 3 months. 
 
Adapting to current market pressures is a must for any business, and in today’s competitive and changing call center industry it is as true as ever. Working with our clients to provide added value through revenue generation has, perhaps more than any other strategy, yielded exponential results – in terms of margins and multiples and more preferable terms upon exit.
 

Kommit & Company is an established firm providing expert consultation on call center optimization as well as helping owners sell their business. You can reach Rupen Fofaria of Kommit & Company at rfofaria@gokommit.com or (919) 321-5207. 

 
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