In today's competitive business landscape, every missed call can mean a lost opportunity. For many businesses, the challenge lies in providing excellent customer service without breaking the bank. A telephone answering service offers a compelling solution, but a crucial question remains: what is the true telephone answering service cost? This guide provides a comprehensive breakdown of what you can expect to pay in 2025, the factors that influence pricing, and how to determine if it's the right investment for your company.
What is a Telephone Answering Service?
A telephone answering service provides businesses with remote receptionists who handle incoming calls. These trained professionals can take messages, answer frequently asked questions, schedule appointments, qualify leads, and even process orders. This allows businesses to ensure that every call is answered professionally, 24/7, without the overhead of hiring in-house staff.
The Core Question: How Much Does a Telephone Answering Service Cost?
On average, businesses can expect the telephone answering service cost to range from $125 to $400 per month 1. However, this is a general estimate. The actual price you pay will depend on a variety of factors, including the pricing model, call volume, and the level of service required. Basic plans can start as low as $25-$50 per month for very low call volumes, while comprehensive packages with advanced features can exceed $500 per month 1.
Pricing Models Explained
Answering service providers typically use one of three main pricing models. Understanding these models is key to choosing the most cost-effective option for your business.
Pricing Model | How It Works | Best For | Average Cost |
Per-Minute | You are billed for the total time agents spend on your calls. | Businesses with variable call lengths. | $0.65 - $1.75 per minute 1 |
Per-Call | You pay a flat fee for each call answered, regardless of duration. | Businesses with short, predictable calls. | $1.75 - $4.00 per call 1 |
Monthly/Tiered | A fixed monthly fee includes a set number of minutes or calls. | Businesses with consistent call volumes. | $100 - $500+ per month 1 |
Per-Minute Pricing
With per-minute pricing, you only pay for the time you use. This model offers great flexibility, but it's important to pay attention to the billing increments. Some providers bill in 1-minute increments, while others bill in 30-second or even 15-second increments. Choosing a provider with smaller billing increments can lead to significant savings, potentially reducing your costs by 20-30% 1.
Per-Call Pricing
Per-call pricing offers predictability, making it easier to budget your monthly expenses. This model is ideal for businesses whose calls are typically short and straightforward, such as for basic message taking. However, if your calls often involve detailed conversations, a per-minute plan will likely be more economical.
Monthly/Tiered Plans
Monthly plans are the most common and offer a good balance of predictability and value. These plans typically include a set number of minutes or calls, with overage charges for any usage beyond the allowance. Overage rates are usually 20-50% higher than the standard plan rate, so it's important to choose a plan that closely matches your expected call volume 1. Many providers offer discounts of 10-15% for signing an annual contract 1.
Key Factors Influencing Telephone Answering Service Cost
Beyond the pricing model, several other factors will influence your final telephone answering service cost.
•24/7 Availability: A service that operates around the clock will naturally cost more than one that only covers business hours. Expect to pay a premium for after-hours, weekend, and holiday coverage.
•Specialized Services: Industries with specific compliance needs, such as healthcare (HIPAA) or legal, require specially trained agents. This specialization can increase the cost by 15-25% 1.
•Additional Features: Services like appointment scheduling, order processing, and lead capture often come with additional fees, sometimes adding $0.10 to $0.50 per minute to your base rate 1.
•Call Complexity: The more complex your call handling requirements, the higher the cost. A simple message-taking service will be much cheaper than one that requires agents to navigate complex scripts or access your internal systems.
•Multilingual Support: If you need support for multiple languages, expect your costs to increase by 10-20% 1.
Hidden Costs to Watch Out For
When comparing providers, be sure to ask about potential hidden fees that can inflate your monthly bill.
•Setup Fees: Some providers charge a one-time fee of up to $100 to set up your account, though this is often waived with a long-term contract 1.
•Holiday Surcharges: It's common for services to charge 1.5 to 2 times their normal rates on major holidays 2.
•Call Transfer Fees: Some providers charge extra to transfer calls to you or your staff 2.
•Spam and Wrong Numbers: Clarify how the provider handles these calls. You shouldn't have to pay for them 2.
Answering Service vs. In-House Receptionist: A Cost Comparison
One of the biggest advantages of an answering service is the significant cost savings compared to hiring an in-house receptionist. The true cost of an employee goes far beyond their salary.
Cost Factor | In-House Receptionist | Telephone Answering Service |
Salary/Service Fee | $35,000+ per year | $1,500 - $4,800 per year ($125-$400/mo) |
Benefits & Taxes | 18-26% of salary | Included in service fee |
Training & Recruiting | Significant cost and time | Included in service fee |
Equipment & Office Space | Required | Not required |
Coverage | Typically 40 hours/week | 24/7/365 |
Downtime (Breaks, Sick Days) | Paid, unproductive time | No unproductive time |
As the table illustrates, the telephone answering service cost is a fraction of the expense of an in-house employee, while providing more comprehensive coverage.
Calculating the ROI of an Answering Service
The return on investment (ROI) of an answering service extends beyond direct cost savings. By ensuring every call is answered, you can capture more leads and increase sales. Improved customer satisfaction can lead to higher retention rates and more positive reviews. Furthermore, by outsourcing call handling, you and your team can focus on core business activities that drive growth.
Conclusion
Determining the right telephone answering service cost for your business requires a careful evaluation of your needs and a clear understanding of the available pricing models and features. While prices can vary, the potential for significant cost savings, improved customer service, and increased efficiency makes a telephone answering service a worthwhile investment for businesses of all sizes. By doing your research and choosing a reputable provider, you can find a solution that fits your budget and helps your business thrive.
References
[1] GoodCall. (2025, May 6). How Much Does an Answering Service Cost in 2025? Retrieved from
[2] DesignRush. (2025, May 1 ). Answering Service Cost Breakdown (2025).