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Overview of Phone Systems


A telephone system is a pivotal part of any business, regardless of the size or type of business looking to install the system. In the past, only large companies and businesses could have budgeted for customized and sophisticated systems. However, there are now many system providers offering telephone systems that will fit the needs of a small company, while remaining within its given budget range.

budgeting for phone systems


A business phone system is made up of four main components. First, there is the base unit. This is the heart of the system, and contains the entire infrastructure of the system. It is what determines how many phones and phone lines the telephone system is capable of handling. …More

Next, there are the units that will be used to make and receive the calls. This is what makes the telephone system tick. There are numerous types of units including handsets, headsets, and desk sets that can be chosen from-ranging from very basic setups, to executive sets and conference table units, as well as wireless sets for flexibility, if needed. These have a wide price range and must be carefully selected depending on the needs or wants of the business.

The wiring of the phone system is probably the most important aspect that must be considered. Planning ahead for wiring needs is a necessity, as any expected growth in the business will need to be accommodated for in advance, in terms of both office space and budget. Check for the ability to install extra phone lines or even an extra unit in the future to ensure that the business is as expandable as possible.

Installation is one of the most time-consuming parts of choosing a phone system. Included in installation is the system configuration, which can be an expensive investment. Some providers will offer installation and setup in their package, so it's worth inquiring whether they can do so. It may even be the case that a provider will offer training for some members of the staff within a chosen package. «Less

phone systems components


There are many different types of telephone systems, and each type will offer different advantages for varying sizes of business; therefore, it's important to ensure that all aspects of the phone system will be met before making a final decision. Before considering a specific type of Business Telephone System (BTS), it's important to understand exactly what employees and clients need.

What is important in choosing a business phone system


There are many aspects of a BTS that must be considered before choosing a provider, mainly based on the size of a company, its expected growth, and the budget set for the system. The most common features that businesses will want their phone systems to have are as follows:

  • Auto Attendant. Also called a digital receptionist, virtual receptionist, or voicemail system, this capability takes the place of a phone operator or a receptionist. It ensures that no calls are missed-day or night. Most providers offer this feature free of charge, allowing it to be a money- and time-saving feature.
  • Automated Directory. This is closely linked to the auto attendant, as it allows clients to find the extension of the person they're attempting to contact without talking to a live operator. This feature should route all calls to preset destinations.
  • Call Forwarding. This is an automated mechanism for rerouting a call to a different phone number or to voicemail, saving both the client and employee time, and allowing for greater efficiency. Call forwarding makes it possible to get calls while one is outside the office.
  • Call Hold. This allows clients to be kept on the phone during confidential conversations or discussions without them being able to hear or listen in. It's also used for keeping clients on the phone until an operator is available to take the call, should phone lines be busy.
  • Conference Calls. This feature allows multiple individuals to participate on a call at the same time. Some providers will limit the number of people who can join on one call; however, this can be discussed prior to the purchase of any package if a greater number of conference calls is desired.
  • Last-Number Redial. A quick and easy way to return a call to a specific office within a workplace, or to return a call to the last client on the phone. This should always be included by a BTS provider.
  • Music on Hold. Closely linked to call holding, this allows music to be played while someone is on hold. It's especially useful for companies with a large number of incoming calls, as it allows callers to stay interested long enough for an operator to answer the call. Some larger companies will use this time on hold to advertise their own business or affiliated businesses with news, jingles, or ads. In other words, it can serve as a very powerful marketing tool.
  • Speed Dial. Similar to the last-number redial, this should always be included with a BTS. Speed dial provides a quick way to store frequently called numbers and dial them with a simple two- or three-digit code.

Types of Systems

There are three basic types of business telephone systems: KSU, PBX, and VoIP. For each of these systems, there is a hosted (cloud) and a nonhosted version. Let's take a closer look at how they differ.

  1. The most basic model of phone system is the Key Business telephone system that uses the Key System Unit (known as the KSU). This type of system is only suitable for small businesses with no more than 40 employees working as phone operators, due to the limitations of the number of phone lines incorporated into it.

    It's an easy-to-use system, relatively comparable to a home telephone system. It has all the basic features a business will need; however, it lacks portability and flexibility. It uses a central switching device-the key system unit-to manually determine phone-line selection.

    The variation of this system is called KSU-Less, which has the same phone capabilities as the basic system; however, it is portable and flexible, as it does not use the central switching unit, and it's entirely wireless.

    KSU-Less does have some serious limitations, though, as it only allows for approximately 10 phone operators, and it's not sold commercially-it must be requested from a phone-system provider. The KSU-Less is an ideal system for a very small business that doesn't intend to expand its workforce. It's not that suitable for small businesses looking to grow.

  2. Another type of system is the Private Branch Exchange system (known as PBX). This is a more advanced system than the KSU and KSU-Less systems, and as such, it has more features that it can access. It uses programmable switching devices, allowing for the automatic routing of incoming calls. This type of business phone system is suitable for a company with 40-plus employees, as it's a much more automated system.

    Another major advantage of the PBX system is that it features an uninterruptible power supply (UPS), allowing a business to remain functional for a period of time, even without electricity.

    A modification of this system is the hosted PBX; the only difference with this system is that the programmable switching devices are no longer installed within the premises of the office; the BTS will be hosted by a telephone provider. The main advantage is the ability for a business to avoid some installation and maintenance costs involved with the standard PBX system, without losing any of the advanced features it initially has to offer.

  3. The latest telephone innovation offered for businesses is Voice Over Internet Protocol (known as VoIP). This is the most advanced system by far, allowing a potential client and phone operator to communicate with each other even if the two are in completely different countries. It works with the use of both the Internet and a computer. However, this also makes it the most costly system, with the cost determined by the number of employees needing to use the system. The main benefit of this system is that all functionalities can be accessed via computer.

    Similarly to the previous system, the VoIP system can also be hosted, offering the same advantages as the basic VoIP system, with less installation and maintenance involved for the business using it, as the service provider hosts the main telephone system.

Choosing a Vendor

Do some serious research into providers before settling on one. Doing so will allow you to find a phone system that is tailored to the size and type of business you have. And always plan for growth when choosing a phone system-one that is suitable at the time of installation may be useless within a year, so a flexible system that can accommodate expansion is a necessity.

The following are important factors to consider when choosing a BTS:

  • Budget
  • Current needs
  • Features that may become necessary in the future
  • Desired productivity-enhancing features
  • Growth and expansion of the business
  • Maintenance, and related costs
  • The number of employees using the system
  • The frequency of incoming calls
  • The training necessary for current and new employees

When all of these factors are considered, it should become easier to choose the system suitable for the size and type of business in question, allowing for growth in the future as well.

Calculating Costs

There are numerous costs to consider when setting up a business phone system. Factors that determine the overall cost have to do with the type of system that is being set up, and the equipment that is already owned by the business.

For KSU and PBX units, there's a cost for the base unit, which can vary greatly due to the fact that it determines how many outside lines, extensions, and accessories the phone system can handle. Generally, the base unit can range from $500 up to several thousand dollars, depending on the size of unit a business needs.

Handsets can cost a large sum of money should your business need anything above a basic model. Basic models can be simple headsets or handheld phones that sell for as little as $10 to $20 each. Wireless handsets and headsets are a bit more expensive, running from $20 to $100 each. Executive or receptionist sets can cost as much as hundreds of dollars per set.

A Computer Telephone Integration (CTI) system will cost thousands of dollars, but it can be a boost for medium-to-large businesses and can be a good investment for smaller businesses as well, as it can help with employee productivity and efficiency.

Installation, training, and maintenance should also be taken into consideration when setting a budget for a BTS. Installation may be included in a package, or it may be less costly if the building housing the office is under renovation, as it means the provider can work with the current internal layout rather than working around any preexisting items that are part of an office.

Training may also be included in the package. However, there may be additional charges for any additional employees that need to be trained.

Maintenance can usually be done remotely, but costs can begin to mount if an engineer has to visit the business premises to fix or solve an issue. Many companies offer reasonably priced service plans.

Purchasing Tips

  • Ensure that the BTS has the capability to be upgraded. If there's a massive boom in business, it's important that the system has the ability to handle a higher volume of incoming and outgoing calls. Also, if the system isn't currently connected to a computer system, this may become a problem as the business grows, and a computer system may become advisable.
  • Budget to cover any unexpected maintenance that may be necessary. It's an easy oversight to make, but ensuring that the funds are available means that there's never a cause for panic or stress. It's also advisable to begin budgeting for a system upgrade in advance, should the business expand at a fast rate.
  • Don't be dazzled by fancy features that are unlikely to be used much in your business. Know which features are essential for your business, and which are appealing yet optional. If something is missing from the package, see if it can be added, and if there's something unnecessary, see if it can be removed to save money. Be sure that the selected package fits the criteria of what is needed.
  • When choosing a provider, it's important to ask whether training is included for those employees who will be using the system. If it is, find out whether such training applies to employees who are hired after the system is in place.
  • Verify the reputation of a provider with current or previous clients, if possible, to ensure that they're quick and responsive to issues or problems, and to check that they're fully qualified to install all features of the selected telephone system. Choosing a reliable provider is as important as acquiring all the desired system features.

Comparison Checklist

Some of the key factors you should take into consideration when comparing vendors are listed below.

Print Checklist

( Show Text Version )

  1. Basic Features
    • Number of phones supported?
    • Auto attendant?
    • Automated directory?
    • Call forwarding?
    • Call hold?
    • Conference calls?
    • Last-number redial?
    • Music on hold?
    • Speed dial?
  2. Extra Features
    • Free training?
    • Ability to upgrade?
    • Future-proof?
    • Hosted by provider?
    • International call support?
  3. Charges
    • Cost of central unit?
    • Cost of installation?
    • Cost of accessories?
    • Cost of maintenance?
    • Cost of handsets/headsets?
    • Cost of employee training?
  4. Service and Support
    • Free live online assistance?
    • Free live phone assistance?
    • Training videos available?

( Hide Text Version )

Phone Systems Purchaser Checklist

Glossary of Terms

  • Auto Attend: Also known as a virtual receptionist, digital receptionist, or voicemail system. Auto attend allows users to navigate a phone system using voice commands or numerical commands entered from the caller's keypad.
  • Base Unit: The main component of the telephone system, primarily defining the number of phones and phone lines that can be connected.
  • BTS: Business Telephone System.
  • CTI System: Computer Telephone Integration System, used to coordinate a telephone and a computer.
  • Handset: A telephone unit that is placed on, or held to, the ear and spoken into for communication.
  • Hosted PBX: The same as the PBX; however, the system itself is located on the premises of the telephone system provider.
  • Hosted VoIP: The same as the Voice Over Internet Protocol system; however, it isn't situated on the office premises as is the standard VoIP system; rather, it is hosted on the premises of the system provider.
  • Key System Unit (KSU): It allows users to manually direct telephone calls to certain phones or phone lines.
  • KSU-Less: Similar to the KSU; however, it uses telephone systems with built-in electronics to perform all of its functions.
  • Private Branch Exchange (PBX) system: It has programmable switching devices to allow incoming calls to be automatically routed to the correct phones and phone lines.
  • System Provider: The company that provides the units, installation, and maintenance of the BTS.
  • Voice Over Internet Protocol (VoIP): An advanced system that uses the Internet and computers, allowing for fast and convenient communication with clients.

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