How To Start a Telephone Answering Service

A telephone answering service business is relatively inexpensive and is a home based business that you can operate without having to leave the comfort of your home. It offers great money making potential and is one the easiest to operate.

Any business that relies on the telephone is a potential customer. However, your target market will most likely be small businesses and professionals with a busy schedule that relies on incoming telephone calls yet cannot take these calls themselves during certain periods of the day.

Some of the best prospective customers to target are small businesses and/or professionals that operate long or odd hours. Examples of such professionals and/or businesses are repair service businesses such as plumbers and electricians.

The needs of an answering service business will vary from one business to another. Most answering services only receive incoming calls on behalf of the businesses or professionals for whom they are working. There are some answering services that offer services beyond this, such as doing some administrative tasks and/or making outbound calls. A business may want or need to have a telephone answering service handle the telephone calls that it receives during a certain period of the day or 24 hours a day. You should choose in advance, the hours that your business will operate and the services that you will provide. This will help you better determine the needs of your business.

Setting up Your Business
If you will be operating a telephone answering service business by yourself, it may best to solicit the business of businesses and/or professionals that need such a service during only certain time of the day. For example, you can choose to have your hours of operation be from 8AM to 6PM. This will allow you to more easily operate your home business by yourself.

You should also choose in advance the number of clients and the services that your business will be providing for them. If all that you will be doing is receiving inbound calls, this will make it easier to handle the responsibilities of more than one business at a time. If your business will be providing

The number of clients that you will take on and the services that you will offer will determine how you will set up your home based business.

Phone Lines
The way most home based business telephone answering services are set up, is for there to be a separate phone line for each for each client. Each telephone is then marked with the company name to help you identify which client phone line is ringing.

Having separate phone lines installed should run you $100 to $200 each. There will also be an additional monthly charge of roughly $35 to $40. You can buy the telephones at a local store. If you intend to expand your home based business into a small business, you will want to lease a switchboard and possibly move to a small office. This allows you to take on a higher volume of calls and therefore more clients. For the purpose of this article however, only the aspect of starting and operating a home based business telephone answering will be discussed.

Switchboards
An alternative to having multiple phone lines installed, is to lease a switchboard from your phone company. You will want to carefully consider the location of the switchboard. Once a switchboard is set up, it can be costly to move due to the penalty fees that phone companies will charge to relocate the service. If you plan to have someone else to help you receive phones calls, this may be a better option for you than having multiple phone lines.

Telephone switchboards can handle more than 100 incoming calls. You only need to activate the actual number of lines that you will be using. The number of phone lines allows you more control and flexibility over your home based business. The number of lines lets you have another operator take incoming as well. Most, if not all phone companies that lease switchboards offer classes on how to use them.

Obtaining Clients for your Telephone Answering Service Business
Any business or professional that uses the phone for business purposes might have a need for an answering service and is a potential client. These businesses and/or professionals can include salespeople, repair services such as electricians and plumbers, on call businesses such as towing services, home based businesses, small businesses such as a doctors office, businesses and organizations that want and/or need surveys taken. You can find these businesses in your local yellow pages, your local newspaper and the classifieds to name a few places.

Once you obtain your first client, obtaining more becomes a lot easier. Positive word of mouth may be the form of advertising once you become established. You can ask your current client for referrals to others who may have a need for an answering service. You can offer incentives such as paying a referral fee for prospects that become clients.

Pricing your Service
When you are determining the price you will charge for your the services of your home based business, you will need to factor in your business expenses. Determine what your total business expenses for twelve months would be. Divide this number by twelve. The revenue that your home business earns you will have to exceed this number in order to make a profit.

The rates that you will charge should be no less than $20 a month. For example, this price may include a standard number of phone calls that you business will receive. The standard number may be 20, 30, 50 incoming phone calls. You may charge your client .25, .50 or .75 for every phone call received after that. Find out what is being charged by similar businesses in your area by calling and asking rates.

Putting together a Contract
You can have an attorney work with you to put together a contract or use a standard contract form. Using a standard contract form works just fine in most cases. However, I recommend working with an attorney to put together different forms depending on the services that you will be providing for various companies.

You will want to have your contract to have a minimum time requirement such as 6 months, with an option to renew at the end of the expiration of the contract.

Have enough Supplies to Conduct Business
Have enough supplies to do business. Supplies such as pencils, pens, paper, index cards, etc. Buy these items in bulk when possible to save money. You will also need a ledger notebook to record revenue and expenses and at least one calendar to write down dates and to schedule your time.

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about the author
Jose Valdez is the owner/webmaster of A Guide To Starting A Business.com
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