by Jarrett Dunaway, SIOR – esrp Contact Center Services Team
The perfect location for a call center requires focus beyond a building’s features or a site’s amenities, as every client has a unique set of requirements for their ideal call center. Through its seasoned practice, esrp’s Contact Center Site Selection team helps take the guess work out of the site selection process.
esrp helps clients define the criteria that is most important to the success of their company. The client ranks the details that matter most to them, and esrp uses this information, along with extensive demographic research and business intelligence modeling, to define a list of the top markets uniquely tailored to that individual client. Throughout this entire process, esrp considers many factors within the current market climate, including current and past market trends, labor demographics, wage rates, call center saturation rates, number of competitors in the market, and more.
Below, are some of the essential elements that go into call center site selections:
Labor Force Demographics
A call center will quickly fail if the necessary labor force does not have both current and future sustainable labor. Analyzing demographics such as education rates, wage rates, and income levels in a given area can help determine whether or not a potential call center employee pool exists within a market.
If a client is seeking a specialized workforce, such as bilingual employees, licensed insurance agents or healthcare associates, our site selection team will use state of the art labor analytics to pinpoint areas where these potential employees exist. Many of the best call center markets in the U.S. are highly correlated with locations near community colleges and military bases. The correlation between the two is due to the high demand for full-time and part-time jobs that do not require extensive training or a college degree.
Labor costs are typically the largest expense for call centers, accounting for approximately 80% of call center overhead and call centers must pay competitive rates to attract and retain quality employees. In addition to competing for talent with other call centers, employers must also compete with other traditional minimum-wage careers, such as retail and fast food companies.
The call center industry has recently seen a market disruption due to state-mandated increases for minimum wage across several states. To stay competitive in the changing marketplace, call centers in these areas must either raise wages or relocate to areas where the minimum wage levels are lower.
Industry Saturation Rates
Market saturation rates is a critical factor that we consider when locating space for a new call center, as these saturation rates measure direct competition within a specific market.
For example, if a market with a labor force of 100,000 has 1,800 call center employees, the saturation rate would be 1.8%. An ideal market would have a saturation rate of 3% or lower, minimizing the risk of oversaturation.
Oversaturated markets tend to negative impact competition for the labor force. During such time, employee retention drops, and call centers must compete for talent by providing workplace incentives and higher wages. The importance of market saturation rates may be mitigated if a company is looking to hire a specialized labor force, such as registered nurses or licensed technicians.
Under-Employment Rates and Total Available Workforce
In addition to market saturation rates, esrp utilizes tools to analyze under-employment rates and the total available workforce, especially in markets that have been hard hit by COVID workforce reductions. In locations where there has been a substantial workforce in the retail and hospitality industries due to COVID, workforce training funds may be available to encourage retaining for customer service positions.
Speed to Market
Once a market has been chosen, the site selection process for real estate begins. Building out a fully customized call center from the ground up can be costly from a CapEx perspective. With the closing of many big box retailers due to COVID, there is an opportunity for a call center to take over these former retail facilities and get to market sooner.
When companies go to the market in search of a new call center site, the average process usually takes 9-12 months from the initial search to completion ready for move‐in. This timeline is far too lengthy for the majority of companies, especially those who need to open operations as soon as possible to initiate revenue generation. The solution: plug and play call centers.
esrp tracks over 1,200 available contact center properties and maintains a database of available plug and play sites. The majority of plug and play former contact centers are equipped with workstations, computers, and phones that is immediately ready for a company to move in and commence operations. Many come with an emergency backup generator already installed.
It is important to understand the complexities within current market conditions and how they may affect the call center site selection as a whole. From the initial client specifications, to the market and site selection process, the highly experienced contact center team at esrp can locate the ideal call center location for any client.