ModSquad uses a Coverage Calculation Model along with ongoing monthly costs as their primary pricing strategy.
ModSquad provides outsourced customer support and moderation primarily through a network of 10,000+ “mods” – remote workers, essentially independent contractors working from home (in 70 countries) to support ModSquad clients. Its remote workers and clients are supported by operations centers in Sacramento, Austin, London, Costa Rica, and the Philippines.
ModSquad’s Coverage Calculation Model
ModSquad does not use an FTE model for pricing. Instead, it deploys a Coverage Calculation Model where “you’ll pay only for the exact number of coverage hours you need, when you need them.”
Here’s an example of pricing Modsquad made public, where a Modsquad client receives 2,500 support requests each month (1,250 phone calls, 625 emails and 625 chat sessions).
For this client, each phone call has an Average Handle Time of about 5 min. With 1,250 phone calls per month, ModSquad is looking at 6,250 minutes of phone support. With 80% occupancy rates, phone support agents will be on their desks for 7,812.5 minutes to provide in-bound phone support, or 7,812.5/60 = 131 hours of phone support for month.
Similarly, 625 emails require 50 hours of monthly support, and 625 chat sessions require 50 hours of monthly support, for a total of 231 hours for phone, email and chat support.
In this example, the client wants to handle 25% of all incoming support queries, leaving 75% for ModSquad agents. This translates to 173 hours (231 * 0.75).
In addition, ModSquad includes time spent by Team Leads (40 hours in this example) to ensure agent productivity and step-in as needed.
This takes the total to 213 support hours per month.
The approach above forms the basis of ModSquad’s Coverage Calculation Model to estimate total monthly support hours, which is then used to calculate Modsquad’s pricing.
ModSquad Pricing Model Overview
ModSquad charges $21.30 per hour for Tier 1, English-speaking support, and $15.25 for non-native English-speaking support (by mods in Costa Rica and the Philippines). The company may reduce this fee if the client has simple processes that require minimal agent training.
In addition, ModSquad applies a 15% loading factor to account for project management, raising the baseline hourly fees by 15%.
The example below shows sample pricing calculations using non-native mods at $15.25 per hour ($17.54 with 15% project management loading).
As shown in the table above, the 15% add-on raises non-native hourly fees to $17.54 per hour.
ModSquad charges $34 per hour for a Team Leader, who may or may not be required on all projects.
In addition, the company charges a one-time setup fee of $3,150 which may vary depending on project complexity.
A minimal engagement costs $3,750 per month (baseline).
If clients have even lower support needs, they could sign-up for “Shared Services” which offers per minute pricing ($1.30 per minute; $1.50 including the 15% project management overhead charge).
Shared Services requires a minimum commitment of 800 minutes per month, or $1,200 at the loaded cost of $1.30 per minute. Shared Services may include a one-time setup fee of $1,200.
When exploring your customer support outsourcer options you don’t always have to brace for ongoing monthly fees. Learn more about flexible, variable cost outsourcing for customer service.
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