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Finding the Best Phone System for Your Business: Step 4

Step 4: Lay Out Your Budget

First and foremost: what does your budget look like? If you have a very small budget, with limited funds for long-term support, that will shape the infrastructure choices you’re making now. Likewise, if your business prefers running lean, and emphasizes service-based purchases, you’ll be looking for less asset-heavy options. One option to keep in mind is that with any budget size, you can look for a vendor who can help transition your infrastructure over time, rather than investing immediately in a new system. Rather than making a big investment up front, some vendors offer hybrid solutions to help you phase in a new system while you phase out the old one. You can minimize downtime and reduce the budgetary issues that may come up with a full, immediate system migration.


Businesses approach communications expenses in one of two ways: capital expenditures or operating expenses. There are benefits and costs to each model, so the final decision is a subjective one. On-premises solutions are capital-heavy, and require a high initial cost up-front. These capital expenditures may be more costly up front than a cloud model, but they also allow for amortization over time and have no additional monthly costs. Cloud solutions, in contrast, have minimal initial investment in assets, with a predictable monthly cost model that can grow or contract as needed. A cloud model is more flexible than an on-premises solution, which can be attractive to growing businesses, but could end up costing more in the long-run if user seats run extremely high.


Phone systems are priced all over the place. Some that boast low monthly fees have hefty up-front costs and vice versa. Others are reasonably priced at the outset and on a monthly basis but then require regular and costly upgrades or service fees. The best way to compare apples and oranges is to look at the total cost of ownership. Your vendor can help you determine this number. A word of caution, however, on focusing too strongly on total cost of ownership: be careful not to overemphasize cost in choosing your phone system. Finding a system that will serve your business well for the length of time you plan to have it is what’s most important. Short-term savings on a system that offers lower quality of service will ultimately have a negative impact on customer satisfaction and worker productivity. Selecting a higher quality system even at a somewhat higher price point secures your future in ways that are well worth the initial investment.


Like a vehicle, your phone system can be leased or purchased. As with any other capital expense, there are upsides and downsides; both are legitimate options. Leased equipment can be replaced more frequently, allowing your technology to stay up to date, which can be great if your company is focused on being cutting-edge. But the downside of leasing equipment is that you don’t fully own the product, and you lack some control over the product. Purchasing a phone system outright can be a great option if you want full control and to minimize future cost in the form of interest rates and fees. The downside of buying your system, however, is that once you’ve invested in a particular solution, you’re basically stuck with the technology until you are ready to overhaul your system again.

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