How to Start a Customer Service Business in India?

Are you looking for profitable new business ideas? How about starting a customer service business? Today, it’s common for companies to aim for lean operations. They thus outsource non-core activities like customer service to other reputed companies. This is where you can come into the picture.

As a customer service business provider, you will handle customer service for your clients. Whether it’s responding to customer emails, operating the telephone lines or offering live-chat assistance, your business handles all customer-facing roles for other companies.

In this article, we will walk you through the steps to start a customer service business in India and share tips on how to run it effectively.

Customer service businesses can be classified into two broad categories:

• A business that offers customer service consulting services. Here, you’ll provide businesses with insights on their customer service operations and give them the tools and knowledge for improving them.
• A business that handles the customer service operations of another company.

In this guide, we focus on the second approach, helping you set up a customer service business, one of the most popular and profitable small business ideas in India.

Step 1: Understand the working of a Customer Service Business

As a customer service business (informally known as a call centre or BPO), you’ll be in charge of handling customer queries, offering support, and processing complaints on behalf of your clients. Essentially, your clients will outsource their customer service department to you. Several businesses often don’t have the resources, time or expertise to handle customer service in-house. So, they outsource the job to a reliable customer service provider like you.

Thanks to the robust digital infrastructure in place, it’s easier than ever to route customer calls to an external service provider. The customer will not know that they are dealing with an external customer service team. Essentially, you have to offer the services like you’re a part of the client’s customer care team.

Outsourcing customer service requirements to a dedicated customer service business reduce costs (office space, in-house hiring), etc. Now that you’ve got a basic idea of how a customer service business operates, let’s explore the different types of customer service businesses in India.

Step 2: Decide the Nature and Type of your Customer Service Business

When we think of customer service broadly, all we can think of are endless complaints made by angry customers. While handling customer complaints is a significant part of a customer service team, there are other services provided. These include:

• Customer support: Providing customers with the latest information on products and services.
• Technical assistance: Helping customers with any issues they face during the purchase journey, after-sales troubleshooting, etc.
• Lead generation: Categorising leads and converting them into customers with marketing calls.
• Handling customer complaints: Listening to negative customer experiences and offering them the right solutions.

You can decide if you want to offer all these services to your clients or focus on only a few. You can also categorise your business based on the nature of the services you provide, as described below:

• Online customer support: Responding to customer emails, replying to customer queries on live-chat, etc.
• Social media customer support: Responding to customer queries and complaints on social media channels.
• Phone customer support: Providing real-time support and technical guidance and information as and when calls come in.
• In-person customer support: Responding to customer queries in person, like operating the helpdesks at malls, retail centres, hospitals, hospitality centres, etc.

Before you set up a customer service business, understand the different types and choose how you want to set up your company. Having a clear idea of your business’s nature will make it easy to develop the business plan, project costs, estimate staff requirements, and other resources.

Step 3: Research Costs and Equipment

Once you have decided the services you will provide, the next step is to estimate costs. Running a customer service business requires initial infrastructure investment. This includes:

• Desktops/laptops and noise-cancelling headsets for all staff
• Desks and chairs
• Office space setup
• Phone system with high-speed internet connectivity
• CRM (Customer Relationship Management) software
• Communication tools

The costs for the initial investments vary depending on the services you provide and your location. Broadly speaking, initial investments typically amount to about Rs. 2 lakh to Rs. 5 lakhs.

Step 4: Identify the Right Telephone System for your Business

The telephone system is the focal point of a customer service business. Even if you offer only online customer service support, there may be instances when you have to deal with end-customers directly via calls. Some issues are difficult to resolve over emails, and customers require the human touch.

Look for a dedicated business telephone system that can handle high call volumes. Also, you’ll need to monitor and record inbound calls for quality and training purposes. Here are a few factors to consider while setting up a telephone system for a customer service business:

• What type of connection will your business need?
• How will you interact with customers? Do you need video-based systems as well as voice-based systems?
• Which software will you use to record, monitor and track calls?

The telephone system is the lifeline of a customer service business. So, make sure that you research all the options available and choose the best one that offers you maximum features at the most affordable costs.

Step 5: Decide the Customer Relationship Management Software

CRM (Customer Relationship Management) is software that helps you collect and track customers’ information at a single point. The CRM is accessible to all employees with a login ID and password. It gives complete details of the customer – how many times they have contacted the client, their past orders, preferences, etc. A CRM helps you deliver a tailored customer experience to each customer.

Here are a few points to consider while choosing a Customer Relationship Management software:

• Ease of use: Look for a CRM that is intuitively designed and easy to use. Your staff must use it efficiently to find the information they are looking for within a few seconds.
• Scalability: The CRM must be able to meet expanding requirements as your business grows.
• Cost: Look for a CRM that offers you the required features for the best prices.

Like the telephone system, CRM software plays a crucial role in determining your success. Take your time and evaluate the options available to find the right one that fits your needs.

Step 6: Identify the Revenue Model of your Business

Generally, online customer service businesses operate on the following models:

• Fixed package: Whenever clients hire you to provide customer service for their business, they have to pay a fixed package cost. The amount is billed either annually, semi-annually or quarterly.
• Customised packages: Here, you set the costs for each client based on the services they require and the volume of customer queries/complaints you handle.
• Commission-based: In this model, your revenue is based on how many customer conversions you drive for the client.

Step 7: Set up your Team

A customer service business requires the human touch to succeed. Ultimately, the quality of services depends mostly on your team. While hiring staff, look for the following attributes:

• Listening skills: The majority of your staff’s time will be spent on dealing with customers directly. So, look for people who have good listening skills and are patient and empathetic.
• Problem-solvers: Your team will have to be quick thinkers. They will have to resolve customer issues in real-time. People who can comprehend customer issues and provide the right responses are a real asset to your team.
• Empathetic: Look for staff members who can relate to customers and reassure them while offering the right solutions.

Step 8: Spread the Word about your Business

Once you have set up the infrastructure and hired staff, it’s time to spread the word about your business. While a customer service business is one of the most popular new business ideas, the downside is that you have to deal with stiff competition. Here are a few ways to make your company stand out and win clients:

• Create a website: You need a robust online presence. Your website not only makes you appear professional but also helps prospective clients find you online. Consider hiring a professional web designer to create a stellar site that creates the best first impression.
• Promote your business on social media: Reach out to target customers via social media. Use social media for content marketing and establish your business as an expert in your niche.
• Word-of-mouth: Once you bag the first few clients, ask them to spread the word in their circles. A glowing review from a company that trusts you is sure to fetch you more clients.

The Next Steps

Now that you’ve got a clear idea of setting up a customer service business in India, the next step is to translate it into action. Start by identifying your business nature, develop a detailed business plan, and get the ball rolling! Good luck with building your dream business!

Also read:

1) 10 Best Ways to Promote Your Small Business
2) How Many Social Media Sites Can I Promote My Online Business On?
3) Online Business Ideas You Can Start Quickly
4) 8 Online Business Ideas That Could Make You Hit Gold in 2020
5) OkCredit: All you need to know about OkCredit & how it works.

FAQs

Q. How much does it cost to set up a customer service business in India?

Ans. The actual costs depend on the nature of the business and the services you provide. Typically, you can set up a 10-person customer service business in India for an initial investment of Rs. 2 to 5 lakhs.

Q. How should I register my business? What is the paperwork required?

Ans. In India, to run a customer service business, you have to follow these necessary steps:

• Register your business under the Companies Act 2013.
• Register the company with NASSCOM (National Association of Software and Services Companies).
• List your company as a Private Limited Company.
• Get the required licenses from DOT (Department of Telecommunications).
• Register for a GST (Goods and Services Tax) number.

Q. How do I measure the productivity of my staff?

Ans. Most customer service businesses use time-tracking software to measure, monitor and evaluate staff productivity. You can choose any time-tracking tool available, depending on your budget and needs.

Q. Can I run the business from my home?

Ans. Yes. It’s possible, provided you have a dedicated office space to work without being disturbed. This is why a customer service centre is one of the most popular small business ideas.

Q. Should I hire remote employees or in-office staff for my customer service business?

Ans. You can hire remote or in-office staff. There are no hard rules. It all depends on the nature of your business and how you would like to run it.