What is a Business Phone System? [Quick Guide]

Submitted by Scott Leonardo on Thu, 05/ 09/ 19 - 08: 43 AM

What is a Business Phone System 


OK, I realize that if you're searching for what a business phone system is, you're probably not looking for a generic answer. After all, we can guess what a phone system is, so a business phone system must be for... well... business. This article discusses the different types of phone systems that meet different business needs, as well as where you can purchase such a phone system.

Not a lot of time? Skip to what you need:

Mobile Phones
Business Phone Systems Through Retail
Hosted Business Phone Systems
Other Considerations

Types of Business Phone Systems

A business phone is a generic term to define a phone, whether mobile or desktop, that is used for the specific purpose of conducting business. This can be a cell phone that you purchased for your startup company, a small business phone system that you bought at a retailer, or something more robust that was purchased or leased through a provider.

Mobile Phone

Mobile Business Phone Systems

Yes, mobile phones can be business phones. Many companies allow employees to use their personal devices on their company's private network to save money, however, other companies wish to have more autonomy over their employees' devices.

Mobile phones can be purchased the same way any private consumer would purchase a mobile phone - through a carrier like Verizon or AT&T.

It's important to note that a business choosing to allow employees to provide their own phones for business use should make sure to take precautions with their network security. Any device that's permitted to connect to your company's network represents a potential threat to its security.

Small Business Phone Systems via Retailer 

Retailers like Best Buy or Amazon sell business phone systems that perform basic functions - and that's the key - these functions are pretty basic.

Some by-the-box phone systems can include several lines (provided you have the appropriate other pieces, like a PBX, to handle such a setup), but there are some features that typically don't come with a standard retail option. 

So, it's likely you would be missing out on popular features like mobility (the ability to forward calls from your desktop phone to your mobile device) and conferencing (the ability to host more than three people on a call).

Phone systems like this can range from a couple hundred dollars per phone to over a thousand dollars. This doesn't include any of the installation or the phone service, either. Yes, it's possible to install these systems yourself, but if the Amazon reviews for this Panasonic system (with a PBX) below are any indication, it may be more hassle than it's worth.

Business Phone System Reviews

Hosted Phone Systems

Hosted phone systems mean that the service and physical devices are provided by the phone system provider. They offer the most options, security, and flexibility for your growing business, but the most upfront costs of the three choices.

Hosted phones are done at a flat rate of $17-$45 per month, per phone. Most plans have you owning your phones after 12-24 months, but the catch here is that the cost never goes away. For some business owners, this is fine, because it is a fixed cost that often comes with the option of getting to upgrade your system when new models come out at no additional cost.

If you're a business that needs more functionality than basic calling and receiving or simple three-way conferencing, then a hosted system might be your best option.

SOS Business Phone Systems-min

Other Considerations

I didn't include on-premise systems provided by a service provider because they are essentially the middle ground between retail phone systems and hosted phone systems. They are often more expensive upfront, however, if you're willing to hang on to your phone system for eight or more years, you might see some savings over a hosted system.

At Standard Office Systems, we've found that most business owners enjoy the flexibility of receiving new technology as it becomes available, so an eight year old (or more) phone system might be pushing it.

We go into greater detail the cost differences between hosted and on-premise business phone systems in our blog about the cost of a business phone system. If you're serious about purchasing a phone system, it's worth the read.

At the end of the day, you have to think about your budget and your long term goals for your company. If you project that you'll be hiring more employees in the near future (meaning less than two years), then purchasing your own phone system and installing it might be more trouble than the savings are worth.

Most business owners, office managers, or IT managers have better things to worry about than how to install their phone systems. Speaking with a service provider is a good place to start. You won't be forced into a plan you don't need or want, but fully understanding your options may be in the best interest of your company.

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Posted by Scott Leonardo


business phone systems