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Phone System Guide For Small Business

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There are many phone systems that are available in 2016 for small businesses. They all have different technologies and come in a variety of configurations that offer different features and benefits. The most advanced small business phone systems run on IP networks. This is the same network that many businesses use to connect devices, employees and sources of information.

How to find the right system

The right phone system will empower your people and make them more efficient and productive. Do you need a feature-rich phone? Do your employees work from home or are always mobile? Some of the features that you need to consider are video conferencing, auto attendant, intercom, paging, softphones for using the computer as a phone, CRM integration and presence technology (the ability to identify who is available at any given moment). Will you need unified messaging to notify people through text or email? Do you need IP phones to enable employees to access data? This will also allow them to be easily reached even when they are in other locations other than your office.


Your organization will continue to change whether you like it or not so best be prepared for it, you need a network that will change with you. Its always good to be able to add more features if necessary and have ease of adding more or less handsets without the need to call out expensive technicians.

Which Companies are the best?

That all depends what you are looking for. There are many low cost VOIP companies that have great packages full of features that are easily extendable. Some people however prefer to stick to traditional analogue or digital phone systems for stability and the assurance that their system is completely taken care of by the professionals.


How big should it be?

The size of your system can be determined by counting the number of users and locations that need a phone. Where do you need to put the phones?

You also need to determine how many calls will be coming into and leaving the office at the same time. The total of incoming and outgoing calls at any given moment is the number of lines that you need. Available configurations are 3, 8, 12, 16, 24 and 48. If you get a larger system, you can be sure that they have expansion slots for future use. Accounting for about 25% growth is the ideal number. If your configuration is too low, your clients will get a busy signal and you don’t want.



These are the traditional phone systems. Most businesses today rarely install analogue telephone systems. A business will only install this type if they only have the very basic requirements. For example, if a business only needs one line and 2 extensions then this is a good option to consider.  This is the cheapest and most basic system of all.

Take note that modern analogue phone systems have the ability to have digital extension phones connected to them. An example of this system is the Panasonic KXT-E624.


Now this system is the popular choice for small and medium sized businesses way back during the ‘90s. This telephone system is capable of connecting to a digital phone line and can have proprietary digital phones connected to it. It also has many features.

With the rise of IP and VoIP systems, this type of system is also becoming obsolete.


This is the most flexible system. It allows you to connect any type of line (ISDN, IP/SIP, analogue) and any type of extension (analogue, digital, SIP, IP). It is currently the most popular type since 2009. Examples of this system include Samsung OfficeSERV, Mitel 5000 and the Avaya IP Office.

IP Enabled Telephone Systems

This system is totally based around IP technology. If you use this system, you will be forced to deploy only IP telephones. No digital phones here. Most IP-based telephone systems allow analogue phones to be connected. An example of this type is the Mitel 3300.


Hosted systems are new but are becoming more popular. You won’t have a telephone system in your office but you will need to have an Internet connection. This is usually ADSL broadband. This then forms the ‘lines’ in your office and needs to be connected to a router on your computer network.  You will have IP phones connected through your network switch.

Hosted systems are ideal for those organizations that change in size from time to time or if they have many users dispersed across several locations.

Other types

There are other not-so-popular types of phone systems.

IP Centrex

This kind is normally only available in selected areas and is offered by cable companies.


This kind is being sold in very limited numbers.

BT Feature Line

These lines are analogue lines from BT that allow very basic functionality between them. This is ideal for start ups that only need 2-3 extensions.


There are many excellent brands that offer a wide range of small business telephone systems to choose from. Each brand boasts of a number of features but they all have the basic features in common.

Each has different capabilities. You can also choose from different packages. The prices also differ according to the maker and the features the phone system has. Some are easy to use and some require some training. Some brands may also require some expensive hardware (i.e. desk phone) that is compatible to their system.

To make life easier we provide a free quote service for small businesses, we will match the right suppliers to your needs. Simply fill out the above form to receive 3 separate no obligation quotations.

Best Set Up

There is no one set up that fits all businesses when it comes to telephone systems. Each company is unique and has its own unique set of requirements. Here are a few things to consider before setting up your telephone system.

How do you want to present your company?

Do you want to be seen as a larger company than what you really are? Do you want to be perceived as a friendly business? Depending on your customer base, some customers feel more comfortable dealing with a larger company. In some situations, customers want a higher level of service that is often associated with a smaller company. You can use your phone system to establish your company’s identity.

Factors that affect a client’s perception of your company

Voice of the Company

You can choose from several options when deciding who the voice of the company should be. This voice will be the first voice your callers will hear. Candidates include the founder of the company, a well-known employee or even a professional voiceover. A professional recording for a few messages will cost around £60. The question really is how you want to project your company to your clients.

If you have clients that come to our establishment on a regular basis, a professional voiceover isn’t going to make a difference. On the other hand, if your clients never see your office, you can benefit from a professional voiceover.

Phone Menu

You want to provide your customers with a set of options to make their calls more efficient. This will also make the process easier for both parties. This is the reason why you are setting up a phone system – to make life easier for everyone. Almost all business VoIP providers give the option of dialing by name directory. You can also enable callers to contact different departments such as sales, marketing, support, billing, customer service, etc.  You can also separate them into new or existing customers. The more options you give, the larger your company will appear. On the flip side, more options may irritate a caller who wants to speak to a real person right away so better include that in your options. This is usually designated to the number zero.

Call recording

When you call your bank or any customer service department, you will usually here the message, “This call is being recorded for quality control purposes.”  You can use this if you really aim to use the call for quality control or training purposes.  Don’t use call recording if you really don’t need it. Call recording is useful for resolving issues but it also uses up a lot of resources so be smart.

Important: Keep mindful of your objectives at all times

There will be many options to choose from. There are many things to consider when choosing the set of features for your phone but it is important to always be mindful of your objectives. Don’t lose sight of what’s important. Don’t be swayed by salesmen who are not thinking about your long-term goals.

You want to answer an important phone call with a live person as quickly as possible because the longer it takes to be answered, the more irritated your caller will be. You can lose a sale or worse, a customer if this always happens. You will be known as a company with poor customer service and you can lose your business.

In general, answering 80% of calls with a real person within 30 seconds of the call is considered good. Abandoned calls should be under 7% of your total calls.

Personal and business smart phones can now be an extension of your company phone. Most VoIP providers have apps that work with Android and iOS phones. If you have a mobile workforce, they can now be empowered to answer customer calls or call customers using their personal smartphones.

You can also control the level of access to your staff with the use of call menu options. You can group incoming calls into high priority and low priority. You can then set rules for the high priority calls. You can have several extensions ring, forward them to several numbers when unanswered or go directly to employee smartphones.



You will be able to get the cheapest prices from a KSU or KSU-less system. But, these systems only offer you a limited number of features, especially the KSU-less system. It is a very basic system and is good only if you have very basic needs and have no plans for growth in the immediate future. A KSU-less system is priced between £30 to £250.


A Key telephone system is ideal for a small business that has up to 40 employees. It has a central unit called a KSU which allows users to have functionality beyond a regular phone. This type costs around £200 to £600 per extension.


If you are sure that you will be expanding or growing your business constantly, a PBX is a good choice. This type is above the other 2 systems mentioned. It is used by businesses that have more than 40 employees. A PBX also has a central unit where all phone lines are tied into. It also has more advanced features than a KSU. The average cost per extension of this phone system is £600 but can go up or down depending on the features required by the client and the number of users. You can actually get an Orchid PBX starting at £100 when they are on sale so be sure to check out sales and promos first.


VoIP uses high-speed Internet in order to send data and then complete the message through a standard phone line. This kind of system works well for any size of company, whether big or small. The price averages around £100 to £120 but you can also combine it with a PBX system where it will cost anywhere from £600 to even over £2300.


Hybrid systems are a combination of 2 systems such as a VoIP/PBX. You can also combine a KSU and a PBX system. If you have an existing telephone system, it is best to ask your supplier if you can upgrade it by combining another system. Your supplier will calculate the cost according to your specifications.

Keep in mind that phone systems for small businesses will cost higher as you add more advanced features and phones. Factor in the cost of installation especially for Key and PBX because these two require professional installation.

Budget System

Now that you have an idea how much each type of system costs, let’s move on to your budget system. Aside from the system itself, you also have to take other costs into consideration when planning your office phone system.

The costs for each call and phone for a KSU and KSU-less system depends on your supplier. You can buy phones from a shop or online. If you have an existing telephone, you can ask the supplier if you can use it with their system. Usually, if your phone is analogue and the system is analogue, you can very well use it. The tricky part comes if your system is digital. It is much harder to install and find compatible phones.

A lot of businesses are turning to VoIP or IP PBX because of their call rates. They are very cheap compared to a traditional phone call made over a traditional phone line however, since VoIP uses the Internet to send and receive calls, you really need is a good Broadband connection. A managed Broadband will cost you around £22 to £35 per month depending on your provider. It is a good idea to get your Broadband and VoIP from the same supplier because they can prioritise your phone calls over the Internet so you always get smooth, good quality calls.

You should also budget for telephone numbers. Each number will cost you around £2.40 with VAT already included. As for UK call prices, it depends. Some calls are free while some cost 1p to 4.8p per minute. These are for landline calls. Directory enquiries are usually 50-60p each. Calls to mobile devices cost 10-12p.

International calls are charged on a per minute basis as well.  The VoIP supplier will usually provide you with packages. Each package will contain a group of countries with the same call rates. You can expect to be charged 1.50p to 2.40p per minute. Some countries even go as high as 12p per minute. But, if you compare these calls to a regular phone line, they are still more affordable.

You can also get SMS text packages. They are usually packaged in 100, 500 and 1000 text messages. The prices are £9, £44 and £86 respectively.

Other charges include European geographical numbers, USA freephone numbers, call recordings, inbound call barring, call me back buttons, etc. Be sure to ask only for what you need so that you can stay within your monthly budget.

As for the hardware such as phones, with VoIP, you only need a minimal amount of hardware as you can use your computer to make and receive calls. You only need a good headset with mic. You can also use a traditional phone but ask your supplier about it.

System Expansion

Some businesses change phone systems because expanding their existing telephone system proves to be too expensive. Moving to another kind of system is much more affordable. If you know you will be expanding or moving, a PBX or VoIP systems are the best choices for you. PBX can be expensive though but it is great for a large company.

On the other hand, VoIP is a much cheaper option as there are no physical infrastructures that need to be moved or expanded. Everything exists on a virtual world. If you need to expand your VoIP, just tell your supplier and in just a few minutes, you can have your extra numbers and users.

VoIP is portable. You can even move it from one country to another without a significant amount of cost.

Additional Costs and Maintenance

I’ve already mentioned the other costs involved in a business telephone system but perhaps one of the most important is repairs and maintenance. You need to have a contingency plan for your phone system should you encounter problems such as a power failure, a down Internet connection or a natural catastrophe. What happens when the power goes out? Will you still be able to make calls? How long will the system be back up and running if your Internet goes down? These are just some questions that you need to ask your provider.

You should also ask about after sales support and if they have continuous support. Will they be able to fix your system remotely or do they need to send an engineer? If so, how long before he gets deployed? What happens while your system is down?

Generally, getting a repairs and maintenance contract at the beginning will guarantee you peace of mind. You will also avoid paying huge fees in the future should your system need repairs.