How Phone Savvy is your Company?

By Elias Terman

We’ve all experienced it. You call a business and the results are frustrating – confusing voice mail, dropped calls, dead air, and long waits. If you’re like me, you’ve even taken your business elsewhere because of a company’s inability to handle your incoming call in a professional manner.

Now try this: call your own business. Ask to be transferred to different departments within your organization. How “phone savvy” is your organization? The results may surprise you.

This article is the first in a series on how to ensure that your business is providing the best phone experience possible to your customers, prospects, and staff. In it, we’ll explore three options for acquiring a business telephone system: purchase, lease, and subscription service. Choosing the option that’s right for your business depends in large part on your company’s specific needs, size, and resources.

Buy vs Lease – Which One is Right for Your Business?

Purchase or lease agreements are the most common options for acquiring a phone system. Under these types of arrangements you typically acquire the phone equipment from either a Value Added Reseller (VAR) or a used equipment broker. There is a lot of used equipment on the market these days so if you have the time and technical resources to find and negotiate a bargain, then consider purchasing a system on the secondary market. For sophisticated applications, you may want to consider partnering with a VAR. They are skilled in implementing highly customized solutions (e.g. high volume call centers, unified messaging, and other specialized applications). Look for VARs that have been certified by the manufacturer and that can provide customer references from businesses similar to yours (in size and/or industry).

Depending on your financial structure, leasing may provide certain advantages. Leasing a system reduces upfront capital requirements by spreading payments over an extended period of time, which reduces your initial cash outlay. Purchasing a system requires the highest upfront capital investment. Purchasing used equipment may reduce your cash outlay; however, keep in mind that the warranty contracts for used equipment are usually shorter and financing can be harder to obtain.

Be sure you understand the hidden costs associated with lease or purchase agreements. It’s important to research and understand the direct and indirect costs of each option as well as the tax implications. Consult your accountant and/or tax advisor before making your final decision, and be sure you read the fine print!

Subscription Services – No Upfront Capital Investment

The third option is to subscribe to a monthly service that includes the phone system. If your business does not need a highly specialized system, subscription services are an excellent solution for getting a feature-rich telephone system without paying any upfront capital or finance charges. For a monthly fee, this option usually includes the telephone sets, local and long distance service, data transport, and Internet access. The tax advantage of this option is that the monthly recurring costs may be deducted as operating expenses. Some providers also offer a trade-in allowance for your old system against any installation costs for the new system.

Businesses with limited in-house technical resources tend to prefer this option as the company offering the subscription service owns and maintains the equipment, as well as delivers and manages the voice and data services. This option also provides business customers with increased flexibility, as additional telephone sets can be quickly added as the business grows.

Tips to Remember

Before you begin shopping for a new phone system, remember these three tips: