Call center agents ...
without the call centers

updated 8:18 p.m. ET May 7, 2005

ARLINGTON, Texas - “Hello, is Jennifer there? Jennifer at extension 43?”

Nancy Allor tilts back from the workstation at the foot of her king-size bed, momentarily puzzling the voice on her headset. A soap opera flickers silently on the TV behind her. Inside the otherwise hushed suburban townhouse, Allor’s parakeet chirps.

Whoever Jennifer is, she’s not here.

“I’m sorry,” Allor says, grinning. “I’m in a call center and we can’t transfer. But I’d be happy to help you.”

Americans dialing for customer service are increasingly being connected to workers like Allor — call center agents without call centers. The move to home-based agents, working from bedrooms and kitchen tables across the country, started as a trickle in the late 1990s. But it is picking up speed as a low-cost alternative to traditional call centers.

It’s not as cheap as offshoring, the shift of operations to countries with pools of low-paid but well-educated workers. But companies bent on cutting costs also see home agents as a way to avoid some of the consumers complaints common to overseas call centers.

More than 100,000 U.S. workers now field customer service calls from home, according to a recent report by consulting firm IDC. Over the next two years, one of every 10 U.S. call centers is likely to shift at least partly to home-based agents, according to another report by consultant Gartner Inc.

Some dub it “homeshoring.”

Call in an order to 1-800-Flowers.com Inc. for Mother’s Day, and there’s a good chance it will be handled by a home-based agent. The same is true for consumers calling The Vermont Teddy Bear Co. or to book a room at a Wyndham International Inc. hotel.

Retailer Office Depot Inc. is closing 10 of its 12 U.S. call centers this year, replacing 900 full-time agents with home-based agents. They include Allor, an agent for Plano, Texas-based Working Solutions Inc., one of several virtual call center firms.

Cutting costs is not the only selling point of virtual call centers, but it’s a large part of the appeal.

Getting rid of call center buildings saves money on real estate. Most of the home-based agents work part-time or as independent contractors, so employers don’t pay for health insurance and benefits. Unions, which represent workers at some large call centers, will be hard-pressed to reach workers spread across thousands of homes, analysts say.

In addition, home-based agents for most companies pay for their own equipment. And companies say the workers are better qualified and more content than those at traditional call centers saving on recruitment and training.

“We are actually realizing some pretty good double-digit savings from this,” says Julian Carter, the Office Depot executive in charge of the call center switch. The company expects savings of $15 million a year.

It’s not just the cost savings, though.

Fielding calls with home agents “gives you the ability to staff with local people who speak the language well, that have the same culture, the same trends, that basically live in the same place,” said Esteban Kolsky, a Gartner analyst. “That’s very appealing to most customers.”

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