AI vs. Human: Restaurant Phone Costs

Estimated reading time: 10 minutes

Key Takeaways

• Using human staff for phone answering involves many costs beyond wages, including benefits, taxes, recruitment, training, management overhead, and the significant cost of missed calls and errors.
• The estimated monthly cost for a human dedicated to or significantly involved in phone duties can range from $2,500 to over $4,000.
• An AI phone agent typically has an initial setup cost followed by a predictable monthly or annual subscription fee, often ranging from $200 to $1,000 per month, which usually includes maintenance and support.
• Direct cost comparisons show that AI agents are often significantly cheaper than human labour for handling restaurant phone calls.
• Beyond direct costs, AI agents help save money by reducing missed orders and reservations, freeing up existing staff for in-house duties, efficiently handling peak call volumes, and offering custom integration.
• AI provides a more predictable expense, reducing financial uncertainty compared to variable human labour costs like overtime or unexpected absenteeism.
• Implementing an AI agent can be a strategic move for restaurants looking to save money, improve efficiency, capture more business, and enhance customer experience by ensuring every call is answered reliably.

Table of Contents

• Understanding the Costs of Human Labour for Phone Answering
• Understanding the Costs of an AI Agent for Phone Answering
• Direct Cost Comparison: Cheaper or Not?
• Beyond Direct Labour: Additional Ways AI Can Help in Saving Money
• Conclusion
• FAQ

Understanding the Costs of Human Labour for Phone Answering

Using people, or human labour, to answer phones in a restaurant seems simple, right? You just ask a host or a server to grab the calls when they ring. But when you look closer, there are many costs involved with paying people to do this job. It’s not just their hourly wage.

Think about someone standing at the host stand. They might be seating guests, cleaning menus, and also answering the phone. The time they spend on the phone is time they aren’t doing other important tasks. When you pay someone for an hour of work, that payment covers everything they do in that hour, including phone calls.

So, the cost of having a human answer the phone is tied directly to their pay, which is a big expense for any business.

Direct Wages & Hourly Costs

When a restaurant hires someone to work, whether it’s a host, cashier, or another front-of-house staff member who handles calls, they have to pay them a salary or an hourly wage. This is the most obvious cost of human labour.

These wages can be a significant expense. For example, if a restaurant needs someone dedicated or partially dedicated to the front area to manage calls, that person’s salary adds up quickly over a week, month, or year.

Hourly rates can change depending on where the restaurant is located – big cities often have higher wages than smaller towns. Plus, there can be extra costs like paying more for hours worked after a certain time (shift differentials) or paying time-and-a-half if someone works more than 40 hours in a week (overtime). Minimum wage laws also mean that wages can increase over time.

This direct payment for hours worked is the foundation of the human labour cost. It’s a predictable cost per hour, but the total cost can vary based on how many hours are worked and if there are extra payments like overtime. Keeping staffing levels just right to cover phones and other duties is a constant balancing act for managers trying to control costs and focus on saving money.

Also, if an employee leaves their job, the restaurant has to find and pay someone new. This process itself costs money. Replacing just one front-of-house employee can cost a restaurant around $1,056 on average. This shows that the expense of human labour isn’t just the hourly pay; it includes the cost of dealing with staff changes too.

So, while paying a person seems straightforward, the total amount spent on wages, including potential overtime or the cost of finding new staff, makes human labour a substantial expense for any restaurant, which factors into the overall Human Labour vs AI Agent cost for restaurants comparison.

Benefits & Payroll Taxes

Paying a staff member their hourly wage is just the beginning of the cost of human labour. There are other mandatory and optional expenses that employers have to pay on top of the base salary.

Think of it like this: the number on the employee’s paycheck is only part of the story for the restaurant owner. Employers are also responsible for things called benefits. These can include offering health insurance, contributing to a retirement plan for the employee’s future, or providing paid time off for vacations or sick days. Not all restaurants offer all these benefits, but many do, and they add significantly to the cost per employee.

Besides benefits, employers must pay payroll taxes. These are taxes taken out of an employee’s pay and matched or paid by the employer. Examples include Social Security and Medicare taxes, which contribute to future retirement and healthcare benefits for workers. There are also unemployment insurance taxes, which help workers if they lose their job.

These extra costs – benefits and payroll taxes – aren’t small. They can add another 20% to 30% or even more to the employee’s base wage. So, if an employee earns $15 per hour, the actual cost to the restaurant might be closer to $18 or $20 per hour when you include all these additional expenses.

These added costs are often less obvious than the hourly wage but are a very real part of the cost of human labour. They are costs that the restaurant has to pay regardless of how many calls the employee answers. They contribute to the overall expense that owners consider when comparing human labour vs AI Agent cost for restaurants, looking for ways to potentially be cheaper and find areas for saving money.

Understanding these benefits and payroll taxes is key to seeing the full financial picture of employing staff, and it shows that the expense goes well beyond just the hourly rate.

Recruitment, Training, and Management Overhead

Another cost tied to using human labour is the money and time spent on finding new employees, teaching them how to do the job, and managing them day-to-day. The restaurant world is known for having employees move between jobs quite often – what’s called high staff turnover.

When an employee leaves, the restaurant needs to find a replacement. This involves advertising the job, sifting through applications, conducting interviews, checking references, and handling all the paperwork for hiring someone new. All of these steps take time and money. As mentioned before, replacing one person can cost over a thousand dollars just for the replacement process itself.

Once a new person is hired, they need to be trained. This means teaching them everything from how to use the Point of Sale (POS) system, how to interact with guests, how to handle money, and importantly, how to answer the phone properly – taking reservations, handling takeout orders, answering questions about the menu or hours, etc. Training takes time, not just for the new employee, but also for the manager or experienced staff member who is doing the teaching. While someone is training, they aren’t working at full speed yet, which can also impact productivity.

Then there’s the ongoing cost of management. Managers spend time creating work schedules, supervising staff, checking their work, giving feedback, and handling any issues that come up. This management time is part of the total cost of having employees. Scheduling alone can be complex, ensuring there are enough people on hand, including someone to answer the phone during busy periods, without overstaffing and wasting money.

These expenses – recruitment, training, and the time managers spend – are often called “overhead.” They are necessary costs for managing human labour. They don’t always show up as a direct hourly cost on a paycheck, but they are very real expenses that add to the overall financial burden of employing staff. When considering Human Labour vs AI Agent cost for restaurants, these overhead costs are significant factors that make having human staff more expensive compared to an automated system that doesn’t require hiring or constant supervision. Finding ways to reduce turnover and streamline training is a way to potentially start saving money on human labour costs, but these costs are always present to some degree.

Costs of Inefficiencies, Errors, and Missed Calls

Beyond the direct costs of paying people, there’s another type of cost associated with human labour that’s harder to see: the cost of things going wrong or not happening at all. This includes inefficiencies, making mistakes, and especially, missing phone calls.

When staff are busy, they might not be able to answer the phone quickly, or at all. A ringing phone that goes unanswered is more than just annoying; it’s a missed opportunity. If someone is calling to make a reservation for a large party, or to place a big takeout order, and no one answers, they will likely just call another restaurant. That lost reservation or order is money that the restaurant could have made but didn’t. This is called an “opportunity cost.”

Errors can also happen. A staff member might write down a reservation incorrectly (wrong time, wrong number of people), forget to mention a special, or get a takeout order wrong over the phone. These mistakes can lead to unhappy customers, wasted food, or having to fix the error, all of which cost the restaurant money and can damage its reputation.

Research shows that restaurants can significantly boost their business just by getting better at answering the phone. Restaurants might see a 15% to 30% increase in the number of reservations they successfully book if they improve their phone answering system. For a busy restaurant, this could mean making $10,000 or even more in extra revenue every month just by not missing those calls.

This lost revenue from missed calls and potential costs from errors are indirect but very real expenses associated with using human labour, especially when staff are juggling multiple tasks. Unlike the predictable costs of wages and taxes, these costs are variable and depend on how busy staff are and how well-trained they are at handling phone interactions perfectly every time. Reducing these inefficiencies and errors is a key way restaurants can improve their bottom line and is an area where an alternative like an AI agent might offer a cheaper solution by capturing more business and making fewer mistakes. These points are crucial when looking at the full Human Labour vs AI Agent cost for restaurants picture and identifying areas for saving money.

Let’s take a moment to see an example of what an AI phone answering system for restaurants can look like and how it works. This video shows how such a system can interact with callers and handle tasks, giving you a better idea of the technology we’re discussing and how it can fit into a restaurant’s operations.

Understanding the Costs of an AI Agent for Phone Answering

Now, let’s look at the other side: using an AI agent, a smart computer program, to handle phone calls for a restaurant. This is a newer technology, and the costs involved are quite different from those of human labour. Instead of paying wages, benefits, and taxes, you typically pay for the technology itself.

An AI agent can do things like answer common questions, take reservations, manage waitlists, and even process simple takeout orders over the phone, using a voice that sounds like a person. The cost for this service usually involves a few different parts.

Understanding these costs is important for restaurant owners to see if this digital assistant is a cheaper option than hiring or using existing staff for phone duties. It’s about comparing the total financial commitment for each approach.

Initial Setup/Implementation Costs

When a restaurant decides to start using an AI phone agent, there’s usually a cost to get everything set up and connected. This is like buying a new piece of equipment or software for your business – there’s an upfront fee to get it installed and ready to go.

This initial cost, sometimes called an implementation fee, covers the work needed to integrate the AI system with the restaurant’s existing technology. For example, the AI might need to connect with the restaurant’s reservation system (like OpenTable or Resy) or their Point of Sale (POS) system for takeout orders.

The amount of this setup cost can vary. It might depend on how complex the restaurant’s current systems are and how much customization is needed to make the AI work exactly how the restaurant wants it to. A simple setup might have a lower fee than a complex one that needs lots of tailoring.

This is often a one-time cost paid at the beginning. After this initial investment, the restaurant can start using the AI agent. While it’s an upfront expense that doesn’t exist with simply using existing human staff, it’s part of the total cost of switching to or implementing the AI technology. When comparing Human Labour vs AI Agent cost for restaurants, this setup fee is a factor to consider, although the ongoing costs are usually the bigger part of the long-term expense. It’s an initial investment that, if the AI is cheaper over time, helps in saving money in the long run.

Monthly or Annual Subscription Fees

Once the AI phone agent is set up, the main ongoing cost is typically a regular fee, usually paid every month or once a year. This is similar to how you pay for streaming services or software – you pay a subscription to keep using the service.

These subscription fees are how the company providing the AI agent covers the costs of running the system, keeping it updated, and providing support. Unlike human wages which can vary based on hours worked or overtime, these fees are usually fixed and predictable.

Research into these AI-powered solutions for restaurants shows that these ongoing costs can range significantly. Depending on how many calls the restaurant receives and what specific features they need (like taking complex orders vs just simple reservations), the monthly fee could be anywhere from $200 to $1,000.

Some services have different ways of charging. Instead of a flat monthly fee, some might charge based on the number of calls the AI handles or the total time spent on calls. For example, these per-call or per-minute charges might average between $1.36 and $2.69 per call. Other services might offer simple, flat monthly fees, such as $350 per month for their basic plans, regardless of the exact call volume within certain limits.

These subscription fees make the cost of using an AI agent very different from the cost of human labour. The expense is for the service itself, not tied to individual hours worked by a person. These predictable, often lower monthly fees are a big part of why an AI agent can be seen as a cheaper option, helping restaurants in saving money on their phone answering operations compared to the variable and often higher costs of employing staff for the same task.

Maintenance and Support Costs

With any technology, there’s a need for maintenance and support to make sure it’s working correctly. This is true for AI phone agents too. However, one key difference compared to human labour is how these costs are handled.

For human labour, maintenance involves things like training, supervision, and dealing with issues like an employee calling in sick or needing a break. These add to the management overhead and can be unpredictable.

For most AI platforms, the cost of keeping the system running smoothly, fixing any technical problems, and making sure the software is up-to-date is usually included in the monthly or annual subscription fee. This is a significant advantage in terms of cost predictability.

Think about it: if a human employee gets sick, you might need to pay overtime to someone else to cover their shift, or service might suffer. If the AI agent has a technical glitch, the support team from the AI company handles it, and that support is typically already paid for within the regular fee.

This means the maintenance and support costs for an AI agent are generally lower and much more predictable compared to managing human labour. You don’t have unexpected costs popping up because the AI needs a break, gets sick, or decides to quit.

This reliability and included support contribute to making the AI solution a more financially stable option. It leads to lower overall overhead because you’re not dealing with variable costs like unplanned time off or the need for constant supervision in the same way you are with people. This predictability helps restaurant owners budget more effectively and is a key factor in determining if an AI agent is cheaper overall, helping with long-term saving money goals.

Predictability of AI Costs

One of the biggest benefits of using an AI agent for phone answering, from a cost perspective, is how predictable the expenses are. With human labour, costs can fluctuate. You might have higher payroll costs one month because of unexpected overtime during a busy period, or costs associated with finding and training new staff if someone leaves.

AI solutions, on the other hand, offer very consistent and easily budgeted costs. As we discussed, you typically pay a fixed monthly or annual subscription fee. This fee usually covers the AI service itself, maintenance, updates, and support.

This means a restaurant owner knows exactly how much the AI phone answering system will cost them each month. There are no surprises like sudden increases in wages, the need to pay for last-minute shift coverage, or the unexpected expense of recruiting a new employee to answer phones.

This predictability is a huge advantage for managing a restaurant’s budget. It makes financial planning simpler and reduces the risk of unexpected expenses that can eat into profits. During peak times, like dinner rushes or holiday periods, the AI system can handle the increased call volume without requiring extra pay or causing staff burnout, all while staying within the predictable cost structure.

By offering such stable and easily budgeted costs, AI solutions help restaurants reduce financial uncertainty. This predictability is a key reason why AI agents are often considered a cheaper alternative in the long run, especially for businesses looking seriously at saving money and gaining better control over their operating expenses. The consistency in spending is a major factor when comparing the overall Human Labour vs AI Agent cost for restaurants.

Direct Cost Comparison: Cheaper or Not?

Now that we’ve looked at the different kinds of costs for both human labour and AI agents, let’s put them side-by-side to see which one is typically more expensive. This comparison helps us clearly see where AI can be cheaper and how it helps in saving money.

Here is a simple table summarizing the estimated monthly costs for a restaurant using either a human employee dedicated to or significantly involved in phone answering, versus using an AI agent. Remember, these are estimates, and actual costs can vary depending on the specific restaurant, location, and AI service used.

Looking at this table, the key takeaway is clear: based on these typical estimates, the cost of using human labour for phone answering is significantly higher each month compared to the subscription cost of an AI agent.

For just one full-time employee whose duties include significant phone answering, the estimated monthly cost, including wages, benefits, and a portion of recruitment/training costs, can easily reach $2,500 to over $4,000. This doesn’t even fully account for the potential cost of missed calls and errors.

In contrast, an AI agent subscription typically falls within the $200 to $1,000 range per month, even for busy restaurants with high call volumes. These fees usually cover all the necessary costs like maintenance and support, which are extra expenses or overhead when dealing with human staff.

Research confirms that AI agents are usually cheaper, especially for restaurants that get a moderate to high number of calls. This is because the AI can handle many calls at once without getting overwhelmed, needing breaks, or making the kinds of human errors that lead to lost business.

The ability of an AI agent to handle calls consistently and efficiently, 24/7 if needed, without the added costs of benefits, payroll taxes, overtime, or the risk of missed calls due to busyness, creates a tangible area for saving money. The difference in the total estimated monthly costs shown in the table highlights why many restaurants are considering AI as a much more affordable way to manage their phones and improve their bottom line. The AI provides a lower and more predictable expense compared to the many varied and sometimes hidden costs associated with dedicated human labour for this task. This direct comparison clearly shows the potential for an AI agent to be significantly cheaper as part of the overall Human Labour vs AI Agent cost for restaurants analysis.

Beyond Direct Labour: Additional Ways AI Can Help in Saving Money

While the direct cost comparison already shows that an AI agent is often cheaper than human labour for answering phones, the savings don’t stop there. AI technology can help restaurants save money in other, less direct ways by improving how the business runs and capturing more opportunities.

These benefits go beyond just reducing payroll expenses. They impact revenue, staff efficiency, and overall operational effectiveness. Let’s look at some of these additional ways an AI agent can contribute to a restaurant’s financial health.

Reducing Missed Orders and Reservations

We talked earlier about how missed calls mean missed business. If a customer calls to book a table or place a takeout order and the phone isn’t answered, that’s revenue lost. Humans can only answer one call at a time, and during busy periods, many calls can be missed.

An AI phone agent doesn’t get overwhelmed. It can handle many calls simultaneously. This means virtually every call is answered promptly.

Research shows that improving how calls are handled can lead to a direct increase in successful bookings and order captures. For a busy restaurant, this could mean adding thousands of dollars in revenue each month just because fewer potential customers are giving up and calling somewhere else.

This increase in captured business is a direct financial benefit. It’s not just about reducing an expense (like payroll); it’s about increasing income. By ensuring fewer calls result in lost business, the AI agent helps the restaurant make more money, which is a very important way of saving money relative to opportunity costs and increasing profitability. This contribution to capturing maximum revenue strengthens the argument for the AI agent being the cheaper overall solution when considering the total impact on the business’s finances, far beyond just the direct Human Labour vs AI Agent cost for restaurants.

Freeing Up Existing Staff for In-House Duties

In many restaurants, it’s the existing staff – hosts, servers, bartenders – who have to juggle their primary jobs with answering the phone. This can pull them away from their main responsibilities, especially during peak hours.

When an AI agent handles all the incoming calls, it frees up these human staff members. The host can focus entirely on greeting guests, managing the waitlist in person, and seating tables efficiently. Servers can dedicate their attention to taking care of the diners in the restaurant, improving the guest experience and potentially leading to better tips. Bartenders can focus on making drinks and interacting with customers at the bar.

Research suggests that shifting phone responsibilities to AI agents allows human staff to concentrate on providing great hospitality and improving the in-person service. This leads to smoother operations and reduces stress for the staff during busy times.

This isn’t just about making staff happier; it’s also about efficiency. When staff can focus on their core roles, they can be more productive. This increased efficiency can mean the restaurant needs fewer staff during certain periods, or that the existing staff can handle a higher volume of customers without needing extra help. This improved workflow and reduced need for additional staffing (especially during unexpected rushes) are forms of saving money by optimizing the use of your human labour force, even if that force is no longer answering the phone. This efficiency gain is an indirect but powerful way an AI agent can make operations cheaper overall.

Handling Peak Call Volumes Efficiently

Think about a busy Friday night. Everyone seems to be calling the restaurant at once to try and make a last-minute reservation or order takeout. With human labour, staff can only answer one call at a time. This means potential customers calling might get a busy signal, be put on hold for a long time, or simply give up. This leads to lost business, as we discussed.

An AI agent doesn’t have this limitation. It can handle multiple phone calls simultaneously. It can answer every call immediately, greet the customer, understand their needs (reservation, takeout, question), and handle the request without putting anyone on hold or sending them to voicemail unnecessarily.

This ability to manage high call volumes without dropping calls eliminates the problem of busy signals and lost business during peak times. By ensuring every call is addressed, the AI helps capture all potential revenue, avoiding the “cost” of lost customers who couldn’t get through.

This is a major advantage over human labour during busy periods. While you could schedule more staff to handle calls during peak hours, that significantly increases your payroll costs. An AI agent handles the surge within its regular subscription fee, making it much more cost-effective for managing busy periods. This capacity to handle volume reliably contributes significantly to saving money by maximizing revenue capture and avoiding the variable costs associated with overstaffing humans just to answer phones during rushes. It reinforces how AI can be a cheaper and more reliable operational tool.

Custom Integration

Modern AI systems aren’t just basic answering machines. They can be quite smart and tailored specifically for different types of restaurants. Whether it’s a fancy fine dining spot, a casual pizza place, or a quick-service cafe, the AI can be customized to understand the specific menu items, know the restaurant’s policies (like pet-friendly seating or corkage fees), provide accurate directions, and even speak in a tone that matches the restaurant’s brand.

Research points out that advanced AI systems can be customized for various restaurant types, which improves the customer experience. This tailoring helps the AI handle calls more effectively and accurately, which in turn reduces the chance of errors or misunderstandings that could lead to customer complaints or operational issues.

While this customization might add a bit to the initial setup cost, it reduces long-term operational risk and helps maintain a high level of service. A happy customer is more likely to return, which contributes to the restaurant’s long-term revenue and stability. By handling specific inquiries correctly, the AI also reduces the need for staff to interrupt their work to answer complex questions from the phone system, further boosting efficiency. This capability indirectly helps in saving money by reducing potential problems and improving the guest experience, adding another layer to why an AI agent can be a cheaper overall solution when looking at the full scope of restaurant operations and the Human Labour vs AI Agent cost for restaurants.

These additional benefits—increasing revenue from captured calls, improving staff efficiency, handling peak times smoothly, and providing tailored, accurate information—all contribute to making an AI phone agent a much cheaper overall solution than it might appear from just comparing direct labour costs. They highlight how AI technology helps restaurants in saving money and improving their financial performance in multiple ways.

Conclusion

Let’s wrap up what we’ve learned about the costs of human labour vs AI agent cost for restaurants. We’ve seen that while using staff to answer phones seems like the traditional way, the costs add up quickly. When you consider not just wages, but also benefits, payroll taxes, the expense of hiring and training new people because of turnover, and the significant cost of missed calls and mistakes, using people for this task can become quite expensive. Our comparison table showed that the estimated monthly cost for even one full-time employee focused on or heavily involved in phone duties could range from $2,500 to over $4,000.

On the other hand, an AI agent typically involves an upfront setup cost and then a regular monthly or annual subscription fee. These fees, often between $200 and $1,000 per month, are usually predictable and include maintenance and support.

An in-depth look at the Human Labour vs AI Agent cost for restaurants reveals that AI agents often provide a significantly cheaper and more reliable solution for handling phone calls, especially for busy or growing establishments. The direct cost comparison clearly shows the potential for substantial monthly savings on what would otherwise be payroll expenses.

But the cost savings extend well beyond just payroll. AI reduces missed revenue opportunities by answering every call, enabling staff efficiency by freeing them up for in-house duties, delivering predictable expenses, and handling peak call volumes without getting overwhelmed. These factors all contribute to the AI being a more cost-effective and ultimately cheaper option for managing restaurant communications.

While there remains a crucial place for human touch and hospitality in the dining experience itself, implementing an AI phone agent can be a strategic move for restaurants aiming to save money, improve efficiency, capture more business, and stay competitive in an increasingly tech-driven industry. Based on the financial breakdown, for many restaurants, an AI agent represents a clear path to reducing costs and increasing revenue compared to relying solely on human labour for phone answering.

https://callin.io/restaurant-phone-answering-service-2/ https://www.7shifts.com/restaurant-labor-costs-playbook/ https://priceithere.com/answering-service-cost-2025/ https://thebossman.ai/ai-voice-agent-benefits-restaurants/

FAQ

Questions About Human Labour vs AI Agents for Restaurants

Q: Is an AI phone agent really cheaper than using my existing staff?
A: Yes, in most cases, especially for busy restaurants. While you might use existing staff, the cost includes not just their time spent on calls, but also benefits, taxes, recruitment/training costs, and the money lost from missed calls when staff are busy. An AI agent’s predictable monthly subscription is typically lower than the total cost of dedicating human time and dealing with inefficiencies.

Q: How does AI save money beyond just replacing a person?
A: AI saves money by capturing more business (reservations, takeout orders) that might otherwise be missed calls, freeing up your human staff to focus on serving in-house customers (improving efficiency and experience), handling high call volumes without extra cost, and providing consistent, error-free information tailored to your restaurant.

Q: What are the main costs associated with an AI phone agent?
A: The main costs are usually an initial setup or implementation fee (often one-time) and a recurring monthly or annual subscription fee. These fees typically cover the service, maintenance, updates, and support, offering predictable expenses unlike human labour costs which can have variable components like overtime.

Q: Can an AI agent handle complex calls like specific menu questions or special requests?
A: Modern AI agents can be customized to understand detailed menus, restaurant policies, and handle various types of inquiries accurately. While extremely complex or unique requests might still require human intervention, AI can handle a large percentage of common calls efficiently, only transferring when necessary.

Q: Will using an AI agent negatively impact customer service?
A: A well-implemented AI agent can improve customer service by answering calls immediately, providing accurate information 24/7, and ensuring no call goes unanswered during peak times. It also allows human staff to provide better service to in-person diners. The key is choosing a system that sounds natural and is customized to your restaurant.