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Costs to Consider When Buying a Small Business Phone System

Small business owners may not know the actual costs associated with owning a phone system until they have one.

Small offices with only a hand full of phones and phone lines have the challenge of how much phone system will be right for them. Buy too much and you waste money, buy to little and you don't get the features that you need.

Here are the costs to consider when purchasing equipment:

  • Price - the initial price of the equipment
  • Installation - Changes to existing wiring in the building
  • Monthly service for dial tone
  • Monthly service agreement, maintenance contract, or hourly rate for service calls
  • Insurance on the equipment
  • Taxes on the equipment

I was at a networking event this week and spoke with an attorney who had just moved here and opened her office a couple of months ago. Her father bought a phone system for her office and paid $4000 for the equipment and installation. They have four lines coming in and there are only two attorneys in the office. Definitely over kill!

Here is the problem, an internal phone system requires a second line to transfer a call to another phone that's outside the office. If a receptionist wants to send the call to a cell phone then she puts the caller on hold and dials the cell phone on a second line then bridges the two calls. Or if someone in the office has forwarded their extension in the office to their cell phone then the system will use a second line here also. So for a small office you have to have several extra phone lines to transfer calls out with an internal phone system. I know of a real estate office that purchased over $100,000 in phone equipment and spend many thousands each month for phone service and most of their realtor's have their extensions forwarded to their cell phones.

We recommend analyzing the number of people you will have in your office and make sure you will not be over buying equipment. Small offices should:

  • Get a simple phone system or a 4 line phone system
  • Transfer calls out using the Flash button

By using a simpler phone system you keep your costs down when making any changes to the staff. You may not need to have a technician on site to make changes. By using the Flash button to transfer calls to a cell phone you don't need as many phone lines so your monthly phone bill goes down.

Internal phone systems are great once your business gets to a particular size but for the small office they are nothing more than money out the window.