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How to Choose the Best Phone System for Your Business

Updated: Mar 1, 2023

  • Choosing the right phone system is an important factor when setting up your small office.

  • You will need to decide what kind of system you want and where you want the equipment to be located.

  • Today's phone systems offer businesses of all sizes a wide range of valuable calling, collaboration and mobile tools.

  • This article is for business owners looking for answers on what to consider when choosing a phone system.

Here are some questions that need to be answered before you make a phone system purchase.

  1. Are your employees in a traditional office environment where they require desk phones, or will they be more mobile, using their cell phones as their main communication tool.

  2. What type of phone service do you want? An internet SIP based system or a traditional analog system connected to the PSTN (Public Switched Telephone Network) provided by your local telephone company.

  3. Do you require the basic features available with typical multi line PSTN service, a more advanced PBX (Private Branch Exchange) or a full Unified Communications solution.

To help you find answers to these questions, please read the following Pros and Cons for these Small Business Phone Systems.

  • Traditional Landlines

  • Internet based VoIP or SIP systems

  • Cloud and on-premises systems

  • Virtual Phone Systems

Traditional Landline Systems

  • Landlines are traditional phone systems installed and maintained by your local phone company.

  • They function on the public switched telephone network (PSTN), and consist of analog lines running on copper cables. Each line is only capable of handling one call at a time.

  • Your phone company can install a Multi Line system that will give you very basic calling features or a PBX that will enable you to route calls to extensions and provide basic voicemail functions.

Pros: Analog landline systems are very reliable, with excellent voice quality.

Cons: These systems are more expensive to install and maintain. The lack of features make them restrictive in today’s business environment.

Internet Based Phone Systems

  • IP Phone systems use the same internet network as your workstations and servers making installation easy and inexpensive.

  • IP PBX systems running on SIP (Session Initiated Protocol) provide small businesses all the communication features that were previously available on very expensive enterprise PBX systems.

  • IP Phone systems give remote workers access to the business's phone system from their mobile devices or computer. Voicemail to email, Fax to Email, Presence, Video Conferencing and much more are available with these systems.

Pros: IP Phone systems provide a huge list of features at a significantly lower cost. These systems are easy to set up, configure and maintain. For businesses upgrading their phone system, existing phone numbers can be ported to provide a seamless transition.

Cons: These systems rely on your internet connection. Phone service will be lost during internet outages or power failures..

Best for: Small businesses wanting the functionality of a sophisticated phone system at a reasonable price and businesses that want their remote employees to have access to the phone system

If you decide that an IP based system is best for you, your next decision is how you want it hosted. While landline systems require you to install the equipment at your business, IP based systems give you the option to buy your equipment outright and self-host or lease an IP PBX hosted in the cloud.

On-Premises IP PBX Systems

  • With on-premises systems, all the equipment,including the PBX hardware to keep the phone system running, is installed at your business.

  • On-premises systems require a larger capital expenditure since you are purchasing the equipment upfront.

  • Once the on-premises system is installed, you will then incur monthly fees for your SIP , which is what allows you to make and receive calls.

  • Your IT staff is responsible for maintenance, repairs and upgrades of the system.

Pros: You are always in control of your service. You and your IT team ensure it is up and running and can make changes to the system at any time.

Cons: There is a higher upfront cost since you have to buy all the equipment. Additionally, you need someone on staff who can service and maintain the system.

Best for: Businesses that don't feel comfortable using the cloud and want total control over their system and access to the equipment at all times; businesses with regulatory or compliance requirements that may be difficult to meet in the cloud

Cloud-Based IP PBX

  • Your PBX is hosted on a remote server where all maintenance and upgrades are handled by the provider.

  • You only have to purchase the physical IP Phone sets used in your office.

  • Typically charged as a monthly fee based on users or call volume.

Pros: There is no PBX hardware to purchase and maintain, thereby lowering your initial investment cost.

Cons: You aren't in control of the hardware. If the system goes down, you have to rely on your provider to fix it as quickly as possible.

Best for: Start up businesses that want to keep capital costs low. Great for home based or mobile employees.

Virtual Phone Systems

  • Virtual phone systems connect those who call a main business phone number to remote workers on their mobile or home phones.

  • These systems are essentially a call-forwarding solution, transferring calls to an employee's cell or home phone instead of a desk phone when a customer calls the main phone number.

  • These systems do include many features, such as automated attendants, voicemail, call forwarding and online faxing.

Pros: This type of service allows businesses with offsite employees to present a professional image at all times. It also gives remote workers access to various phone system features that mobile and home phones don't offer.

Cons: Virtual systems aren't full-featured phone systems. They do not have the Unified Communication abilities of IP based systems.

Best for: Small businesses with remote workers or sole proprietorships

Check out our IP Phone Page for more Information


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