How Much Does a Business VoIP Phone System Actually Cost?

Talk is cheap, but communication is priceless. A reliable way to interact with customers, clients, and prospects is vital to running a business. Which makes picking the right phone system a critical choice for your company’s success.

While it was certainly understandable to critique VoIP (Voice over Internet Protocol) phone quality in the past, it has come a long way. Thanks to increasing internet speeds and stronger computing technology (think Gateway PC circa 1998) VoIP has closed the gap in its level of stability and reliability. So unless you’re stuck in a place with crawling connection rates or constant power outages, VoIP can be a great choice for your business.

With the reliability gap closed, the other pressing factor is cost. Let’s explore the two main types of phone systems and see how much bang each one offers for your bucks.

How does the cost of a VoIP system compare to a landline?

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Traditional landlines rely on separate, dedicated copper wires, while VoIP solutions can run on your existing internet connection,  transmitting your voice as data. As a result, VoIP for business can be much cheaper, starting as low as $19.99 a month, plus the cost of running your internet connection. A landline, on the other hand, starts at around $100 for a base unit, with extra charges incurred for each additional user.

What is the True cost of VoIP for Business?

As in many industries, the real cost is more than just the “sticker price.” All the other benefits and drawbacks that surround a service can increase or decrease the value of your purchase. From the cost of ownership and infrastructure to operational costs and equipment, the price is not always what it seems. Which is why weighing all the factors that go into selecting a phone system can save you from thousands of dollars worth of buyers remorse.

Research shows switching from Landline to VoIP can slash phone related costs for a business by 40-80% Intelice Solutions

Cost of VoIP: Usage Fees

International Calls

Traditional phone lines rely on a physical (wired) connection in order to place both local and long distance calls. This means that having international numbers (or placing international calls) can get really expensive, really fast.

However, because VoIP works on web-based connections, it’s a lot cheaper to make and receive long-distance calls. Additionally, for businesses that operate within several countries, or just need to have international numbers, VoIP offers the flexibility to create numbers fast.

Depending on the regulations of each individual country, you can create a phone number, anywhere in the world in as little as five minutes, making VoIP the best bet for a globally distributed business.

Licenses & Subscriptions

Making a decision that will heavily impact how your sales and support teams work is a huge deal. In this area of business, one bad choice can cost you thousands of dollars to rectify, and countless hours down the drain.

Which is why having a flexible solution is key. Switching to VoIP offers users a modern, subscription-based model of purchase. Rather than buying annual licenses for every single person (regardless of how often they use the phone), you have more leeway on making decisions.

Month-to-month commitments let you add or contract your user base after seeing what works for you and your team. This way you’re only paying for the value that you’re getting from your phone.

On the other hand, committing to a phone solution that you love can also open you up to savings and discounts. Going with an annual (rather than monthly) license can let you in on deals that are not available to monthly users.

Lastly because cloud-based solutions have a lot less physical setup, it’s easy to explore what your team needs over a trial, expanding your pool of potential providers. The flexibility to switch if you’re unhappy with the product incentivizes your VoIP provider to stay on top of their game, unlike legacy systems which can lack the pressure to continuously iterate on their product.

Hardware

Power Dialers

Traditional landlines, by default, must include a physical components – often handsets – that are connected to the wall. As we’ve already seen, the ballooning costs of individual phones can add up quickly and eat into your profits.

In addition to their costs, physical handsets also tend to be behind in their user-friendly and easy-to-use characteristics. These less intuitive products make them harder to learn and use in the workplace.

One of the biggest benefits of Voip is that is brings more flexibility to your phone system- literally. Many systems offer downloadable (and user-friendly) VoIP apps that you can access via a laptop or cell phone. This lets you use your laptop or mobile phone as an extension of your office telephone network, rather than having to install a phone in each remote location or purchase separate business phones and devices.

Maintenance

Not having a physical phone system means not having any physical hardware to maintain. Phones breaking, wires fraying, and electric sockets shorting can damage physical phones, sometimes irreparably.

Having to call in an IT crew to run diagnostics on your hardware can get expensive, and time-consuming. Each moment spent handling those issues means less time that your support and sales teams can spend on the phone with clients and customers- driving down your quality of customer service.

Cloud-based software takes no maintenance (since the provider assumes all the burden) and can often be done remotely. Simply reloading an app or restarting the computer is usually all it takes to have your shiny new updates in place. Software updates and maintenance can also be handled automatically during off-peak hours. This eliminates the maintenance costs and the expense of paying an entire crew to come into your office and disrupt employees as they work.

Benefit of VoIP: Added Value

Abandoned Ping Pong table

While there are many clear cost-saving benefits that come with switching to VoIP, some of its many attributes come in a more nuanced way. This value may not be directly reflected on the sticker price, but the advantages are clear cut.

Space

Time is money, but if you’re located in any metropolitan city, you are well aware that space is also money. And lots of it. Which is why in the era of hot-desking and open offices, setting aside an entire room dedicated to holding cables, cords, and wires is wasteful.

VoIP lives where your internet lives — in modems and routers that are small, modern, and portable. This lets you free up that space for far more important uses like events, meetings, and yes even that ping pong table you’ve always wanted.

Integrations

Your team is probably already using a sophisticated stack of software to do their work. The ability to integrate their essential apps into your phone system is emerging as potentially VoIP’s most impactful advantage.

Due to the traditional structure of landlines, adding these modern capabilities is almost impossible on a traditional phone. Advanced features that are easily available on VoIP systems are often inaccessible for a landline. These time-saving superpowers streamline your workflow, reduce manual data input, and ultimately cut costs.

customer retention data

Scalability

Growing businesses need to be able to ramp up their workforce, fast. This is especially true during seasonal swings where you usually see a huge uptick in business. For example, landscaping businesses in the summer, or eCommerce stores during the holidays, need to be able to get employees up to speed ahead of customer demand.

Having a VoIP system lets your team grow with the needs of the company. You no longer have to order and install new phones each time you add a sales or support rep. Simply get online and create a new number when needed, and you’re already ahead of the game.

Can VoIP’s lower costs save your small business money?

The short (and long) answer is yes. From the initial setup to lack of maintenance, the cost of VoIP is lower, making it a win for small businesses. Slashing phone related costs lets your business put money into the things that you actually want to improve– your product and your people. And that’s the biggest benefit of all.

Further Reading:

Proven Benefits of VoIP for small businesses with big plans

VoIP Risks Resolved: How to Address Security Threats

Is VoIP a reliable service for your business?

The phone system for modern business