BENEFITS OF HOSTED PHONE SYSTEMS FOR SMALL BUSINESSES

Small firms seeking phone systems with all the bells and whistles should think twice before investing in traditional on-site Private Branch Exchange (PBX) systems. Hosted Phone systems offer all the features of the traditional PBX, but with more functionality and significant cost savings because there is no equipment to buy, lease or maintain. And in today’s chaotic economy, Hosted Phone Systems are more flexible to adapt to changing business requirements.

“The final decision for a new phone solution falls into two categories – outsourcing vs. owning,” says Jeanne Sauer, a California-based consultant who specializes in Hosted VoIP (Voice over IP). “The outsource model [phone system hosted by telecommunications provider] has become very attractive to small and medium-sized businesses who are looking for a new phone system or need to expand or upgrade their current solution because capital expenditures are difficult to fund. As a result, the Hosted model has been taking off in the last few years.”

There are several Canadian companies that have entered the Hosted Phone market, but not all systems are alike. Some providers offer their service over the Internet, which has disadvantages including the potential for degraded voice quality, less security and, if connectivity fails, loss of productivity from telephone outages.

Quality of service, in particular, is a key issue with hosted VoIP solutions. If the service is offered over the Internet there is no guarantee that voice data gets priority over other data coming through the line, particularly if the site has a lot of traffic, which can impact voice quality.

With that in mind, Allstream Small Business, a Canadian owned and operated company, offers a Hosted Phone solution running on a dedicated, business grade, secure private data network.

“Since our system doesn’t run on the public Internet it is much more reliable,” says Allstream Small Business’ Russ Friesen, VP National Small Business Markets. “You don’t have to worry about dropped calls or phone system outages. Our solution is run on a network used only for voice traffic so you enjoy business-grade phone service and the same voice quality that you are accustomed to.”

Hosted Phone systems also offer the extra reliability of built-in disaster recovery.

“If you own a CPE solution [Customer premises equipment] you must buy back-up power supplies to keep the system power running, although there are no guarantees the system will work in an emergency situation when the whole network goes down,” explains Sauer. “But uninterruptible power runs your Hosted Phone System and redundancy and back-up for the telephone switch is built into the service. In the case of an emergency situation at the customer site, the Hosted Phone System will continue to receive messages and the business can reroute incoming calls to alternative phone numbers or a cell phone, via the web portal from any computer that is connected to the internet.”

The major advantage of hosted phones for small companies is that there are no large capital expenditures, unlike on-site PBX where the price of buying or leasing equipment and installation can add up to $10,000 in upfront costs, plus an additional $10,000 over five years to run the system. Alternately, the Allstream Small Business Hosted Phone System comes with no set-up or installation fees (because the provider hosts the system), and costs around $15,000 to run over five years.

So not only is a company saving $5,000 over five years with the Allstream Small Business package, it’s easier on cash flow as there are no large upfront bills, which can be difficult for smaller companies to afford. Instead, clients pay only a fixed monthly fee – which can be planned for and budgeted.

“The money you save by not purchasing equipment can be better used to invest in and grow your business,” points out Friesen.

Since not every employee necessarily requires the same features, Allstream Small Business offers two packages to choose from, depending on individual employee needs. The basic package (16 calling features) is $25 per month per phone on a three-year plan and the standard (24 calling features and 14 web-based tools) is $50 per phone per month on a three-year plan. So firms simply choose the number of phones they need.

Sauer notes this flexibility sets Allstream Small Business apart from its competitors and makes the solution particularly attractive.

There are other long-term costs associated with an on-site PBX that make Hosted Phone solutions even more advantageous. With on-site systems, there are ongoing technology upgrade costs – often every six months – which you must invest in or the PBX becomes obsolete.

With an Allstream Small Business Hosted Phone System, all repairs, upgrades and system maintenance are performed free of charge so there are no surprise costs down the road, making it easier to manage ongoing cash flow.

“You don’t take on the risk of obsolescence,” says Friesen. “You just pay your predictable monthly fee.”

Sauer also notes that Hosted solutions are green by design.

“You reduce your company’s energy consumption because Hosted phone systems have superior energy efficiency as compared to a PBX,” she says.

But there are other advantages beyond cost savings. Hosted phones also increase productivity and efficiency.

For example, Allstream Small Business’ package has all the efficiency tools you would expect from an on-site PBX, such as caller ID, voicemail, speed dials, call waiting, call transferring, forwarding and extension dialing. But it also has new and powerful features not available with many PBXs such as visual voicemail, click to call, call logs, automatic call distribution groups and auto attendant.

“Allstream Small Business has included all the important applications that businesses need to be successful without requiring them to pay any additional fees,” says Sauer. “These features are attractive to small companies because it makes them appear to be larger firms to their clients.”

This, according to Friesen, is why so many small businesses are turning to their solution.

“We offer big company phone services on a small business budget,” he says. “You get all the features of a standard PBX with enhanced functionality at a lower cost.”

Hosted Phone systems are also hassle-free. The Allstream Small Business solution comes with 24/7 technical support, management and monitoring so if a problem should occur a trained technician can deal with it quickly. This means less possibility of disruptions in phone service – which is something no business can afford.

In addition, web-based tools allow designated staff to add or move lines, change system options and set individual preferences. This is also a cost-savings as your firm won’t have to maintain an on site technician or contractor to deal with phones, or take too much time away from any employee’s main function in order to administer the system. You don’t need specialized technical knowledge to create company directories and speed dials, or to set up and manage call or hunt groups.

There is no major staff training required so the transition to the system isn’t time consuming or costly.

With the ability to customize and set the system up to optimize work flow, productivity is increased.

“With a CPE solution you need to call your vendor to schedule and coordinate adding new employees, new lines and possibly new line or trunk cards,” notes Sauer. “This is a very time consuming process and comes with fees for providing the service. Hosted Phone systems allow the customer to control their business communications. The online administrator portal is accessible from anywhere at any time. It’s easy to set up new users and you can say goodbye to pricey service calls for changes

Today’s workplace isn’t defined by bricks and mortar and many employees move between work and home offices and various job sites or employ contractors who work remotely. Hosted Phone systems offer features that allow seamless transition between locations.

“You can make any phone your business phone so it is great for working at home or staying in touch on vacation or to connect remote workers,” adds Sauer.

For small to mid-sized businesses with several locations, hosted phone systems are an ideal solution, offering uniform feature functionality in multiple branch offices and providing consistent operations for your business.

“The sweet spot for Hosted systems is often those multi-location businesses that have between five to 50 employees,” says Sauer. “They struggle with owning and managing multiple CPE based systems and various vendors and contracts across their locations. The idea of one vendor, one bill, and one phone solution is very attractive to these businesses.”

Today’s marketplace is changing on a daily basis, which makes long-term planning difficult. Your company may have to shrink in size or expand quickly. You may need to change processes or operational structure. Firms have to be flexible to stay competitive.

However, on-site phone systems don’t offer this adaptability. There are no refunds if you need to reduce the number of seats, nor can you add seats without costly purchases.

With the Allstream Small Business Hosted Phone System users can be added or removed at any time so the system is flexible to accommodate a company’s changing needs.

With so many cost savings and efficiencies, Sauer predicts that an increasing number of providers will be entering the rapidly growing hosted phone market in the near future to keep up with increasing demand. But she cautions that firms need to look carefully at the various solutions offered and the technology and infrastructure backing their service.

“Allstream Small Business is uniquely positioned because they are in the Canadian market today and making investments for future applications, features and benefits,” explains Sauer. “Allstream Small Business has made investments in the infrastructure so the small and medium sized firm can focus on their core business, not the phone system.”