Stop Overpaying! The Ultimate Guide to Cutting Business Telephone Service Costs

Small and Medium-Sized Businesses

October 7, 2024 | By Shirmattie Seenarine

TL;DR: This blog breaks down how to audit your current phone bill, identify unnecessary costs, and negotiate with providers for better deals. Whether you’re using analog or cloud-based systems, you’ll learn how to maximize savings by leveraging your current equipment and avoiding unnecessary fees. By transitioning to a cloud phone system, you can improve scalability, eliminate maintenance headaches, and ensure business continuity


 

Decode Your Business Telephone Expenses

Understanding your telecom expenses is not just a matter of managing costs; it’s a crucial step in safeguarding your business’s financial health.  These expenses can become a hidden drain on your budget if left unchecked.

This article and its comprehensive checklists are your tools to stop overpaying and take command of your business phone service. It’s time to understand what you’re paying for and make informed decisions. Here’s what to look for when you log in to your telecom account or read your business telephone service bill:

Hidden and Arbitrary Fees

Whether your business uses analog phones or has already transitioned to a cloud phone system, unnecessary or unexpected fees can be a significant issue.

Whether your business uses analog phones or has already transitioned to a cloud phone system, unnecessary or unexpected fees can be a significant issue.

 
Pro Tip #1
Pro Tip #1Tax and Fees Can Be Significant
Ask providers to quote you the total with taxes and fees included or request a tax assessment for your quote. Most of the time, the advertised cost is not the final total because it does not include hidden fees, which can easily be 20% to 30% on top of the quoted monthly recurring cost.

Evaluate Your Equipment Needs

  • One of the most significant concerns for businesses already using cloud phone systems  is whether they can retain their current phones when switching to a new cloud provider. Many cloud phone systems allow you to bring your own devices (BYOD), which means you can keep your existing phones if they are compatible with the new provider’s system. However, not all providers support BYOD and if they do, your phones may still not be compatible with the new phone system. So, it’s important to ask upfront, as replacing phones can be a substantial expense.

      

  • If you are considering moving to a cloud-based phone service, you will need to replace analog phones that rely on physical hardware and dedicated phone lines with phones that leverage Voice Over Internet Protocol (VoIP) technology, like IP Phones and softphones. Some providers offer rental options, while others may include phones at no additional cost. Speak with different providers to uncover the best pricing for your business.*
Pro Tip #2
Pro Tip #2Analogue Phones are Legacy & Expensive
If you are not convinced that moving to a cloud-based phone system is right for your business, read the section titled, Cut Costs Instantly: How Analog Phone Users Can Benefit from Cloud Technology.

Business Phone Number and Rollover Numbers

Many businesses, especially those with analog phone systems, pay for multiple phone lines. These often include rollover numbers, which are additional lines tied to the primary business phone number. Rollover numbers allow incoming calls to be automatically redirected to another line if the primary line is busy. However, most companies today find they no longer need as many rollover numbers. Overlooking rollover numbers means paying for lines with little or no traffic.

 

Negotiate Discounts

  • If you are moving from one cloud phone system to another and your current phones are compatible with the new phone system, leverage this to negotiate a discount, especially if your new provider offers free telephones. Since the new provider won’t have to incur the cost of supplying you with phones, they may be willing to provide you with a lower rate.

    

  • For businesses with analog phones, negotiations come in the form of discovery. Speak to as many providers offering cloud-based phone service to uncover the best price.

 

Upgrade Your Business Phone

Keep going if you find a great cloud-based phone system provider. Ask about free add-ons and phone features.

  • Free add-ons, such as a business mobile app or a softphone, can significantly enhance your business operations. They allow you to make and receive calls from your business phone number on a smartphone or other devices. If you’re promised free add-ons like a softphone, be sure to ask if there are additional costs, such as licensing fees. Don’t hesitate to ask the phone service provider to waive additional fees.
  • Choosing the right features and functionalities is key to enhancing your business communication and collaboration. Beyond basic calling features, consider inquiring about instant messaging, video calls, conferencing, voicemail to email, and other features that can streamline your daily operations.
  • When considering new phones, especially those offered by the phone service provider, it’s vital to do your research. Inquire about the brand and model and assess how they align with your business needs. For example, is it a Polycom phone? Is it a Polycom VVX 500 or a Poly Edge E400? Both are reputable, but one may be better suited for your business based on its features.
Pro Tip #3
Pro Tip #3Devil in the Details
Don't scrutinize your phone bill just one time. Conduct a deep dive regularly. Compare what you're being charged with and what you're using. A feature important to your business in the past may not be so important anymore.

Cut Costs Instantly: How Analog Phone Users Can Benefit from Cloud Technology

Switching from analog phones to cloud technology is more than just a trend—it’s a strategic move that can lead to substantial savings and improved business operations. Here’s why making the switch could be one of the best decisions for your company:

 

No More Maintenance Hassles  

Traditional phone systems require ongoing maintenance, often resulting in downtime and repair costs, not to mention regular maintenance fees passed on by your phone provider. On the other hand, cloud-based systems are maintained by the service provider, relieving your business from the burden of system upkeep, and ensuring your operations remain smooth and uninterrupted. Cloud-based systems alleviate maintenance hassles, allowing you to focus on your core operations.

 

Significant Cost Savings 

Many businesses experience a significant reduction in their monthly telephone bills after switching to the cloud, largely because it eliminates the need for multiple lines, maintenance contracts, and the hidden fees associated with analog systems. These can lead to substantial cost savings, providing your business with a more secure financial future.

 

Business Continuity

One key advantage of cloud-based systems is their resilience. In the event of a power outage or disaster, your phone system remains operational because it’s hosted remotely instead of on-premises. Remote hosting ensures that your business can continue operating and communicating with customers, providing a sense of security and preparedness for unforeseen circumstances.

 

Scalability and Flexibility

As your business grows, so does your need for additional phone lines. Cloud systems allow you to easily add or remove lines as needed without new hardware installations. This flexibility ensures your telecom system grows with your business rather than holding it back.

Pro Tip #4
Pro Tip #4Regularly Review Your Telecom Setup
Even after making the switch, periodically reviewing your telecom setup is wise. Technology and business needs change, and what worked last year might not be the best solution today.

Essential Checklist for Cutting Business Telephone Costs

  • Audit Your Telecom Bill [__]

    Start by reviewing your current bill in detail. Record all the charges, including the number of telephone lines, maintenance fees, and any other recurring costs. Consider whether you still need all the rollover numbers or if they're merely adding to your expenses without providing real value.

  • Evaluate Contractual Obligations [__]

    Determine if you're locked into any long-term agreements that might include penalties for early termination. Knowing this will help you plan your transition to a new provider without unexpected additional costs.

  • Compare Cloud Providers [__]

    Contact 3-4 cloud phone service providers to get quotes. Ask for a complete breakdown of all fees, including taxes and additional charges, so you understand the actual service cost.

  • Consider New Phone Hardware [__]

    If you're moving to a cloud-based system, you must replace your old analog phones. Some providers offer rental options, while others may include phones at no additional cost. Be sure to factor these costs into your decision. If you have previously migrated to cloud telephony, determine whether your existing phones belong to you or the provider. If they were purchased, determine whether they are compatible with the new provider's system. If they are, use this as a point of negotiation. Providers often offer discounts when you bring your own devices, as it reduces their costs.

  • Assess Your Network Infrastructure [__]

    Ensure your business locations have the network connections to support a cloud-based phone system such as Power over Ethernet (PoE) switches. If not, plan to upgrade these connections before making the switch.

  • Plan the Transition [__]

    Work with your chosen cloud phone service provider to set a porting date—the date your phone numbers will transfer from your old provider to the new one. If you are migrating from analogue phones to cloud telephony, avoid disruptions by ensuring your new phones are set up and evaluated before this date. On the porting date, your old phones will stop working once your phone numbers are moved to the new phones, which will be operational after porting is complete. If you are simply switching between cloud phone providers, work with your chosen cloud phone service provider to set a porting date. If you're concerned about potential disruptions, ask for temporary numbers from your new provider and forward calls from your current provider to your new one during the transition until you have been officially moved to the new provider. Note that not all providers provide temporary numbers.

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