November 28, 2020 is a daily online magazine covering small business news. We help entrepreneurs transform ideas and innovations into greatness.

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VoIP Phone Systems


VoIP Business Phone System Costs

Can VoIP dramatically reduce the cost of your company's phone service? Absolutely! But VoIP won't automatically improve your bottom line. In fact, if you don't do your homework it could actually end up costing more than your current phone service.

Maintaining clear channels of communication is important to your bottom line, but it comes at a price.

Although traditional KSU and PBX phone systems seem straightforward, costs quickly add up when you consider the long-distance charges that are incurred in a business with multiple locations or a geographically diverse employee base.

VoIP business phone systems are designed to eliminate the expense of internal long-distance and international calling. They also offer features that combine the benefits of telecommunication solutions and electronic data applications. But as a cost-conscious business owner, you're very concerned about the net impact a VoIP business system will have on your bottom line.

Comparing costs from one VoIP business vendor to another can be elusive. Your best bet for securing favorable pricing is to understand how VoIP system pricing structures are designed and how you can get a handle on managing costs.

Pricing Structure Essentials

Pricing for business-grade VoIP phone systems varies dramatically because it's difficult to estimate the hardware upgrades you'll need to make in the transition from digital to VoIP. Expect to pay initial set-up fees for hardware and installation. If you can't use any of your current phones or hardware, the cost of startup equipment might hurt a little. Once your infrastructure is in place, you will be assessed a monthly fee from your vendor.

The cost of a VoIP conversion depends on factors that include the system's features, your existing telecommunication infrastructure and your existing data network resources. A complete VoIP system for a typical small business will run $8,000+, while a more complex 64-phone, dedicated server solution can cost in excess of $35,000.

Other Considerations When Buying VoIP Phones for Business

  • Carefully evaluate the numbers before you commit to a VoIP transition. If your company is a single-site operation without a large number of remote workers or high long-distance bills, a VoIP business system may not be a wise business investment.
  • At the same time, evaluate the additional benefits your company can achieve through VoIP. In some cases, the ability to centralize and integrate your phone system with other applications may outweigh surface-level cost considerations.
  • Be diligent about analyzing and assessing your current phone system before you purchase new equipment. If you can repurpose at least part of your current system, the savings will be worth the effort.

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