Evolving Small Businesses – Phone Lines

Study after study has shown that Canadian small businesses are lagging in their spending on information and communications technology (ICT). When speaking with CleverHost’s existing and prospective clients, this has definitely rung true.

This is the first blog entry in a series we’re calling “Small Business Evolution,” and it is something seemingly mundane – phone lines.

Phone lines are not the most glamourous topic in the world, but they’re certainly an important one. Many small businesses feel having a phone line of some sort, whether it’s a landline or a cell phone, is a prerequisite for doing business. And in reality, it is, because lots of customers still prefer the phone over email or instant messaging/chat. You need to serve your customers in the manner they feel most comfortable with.
On the other hand, most small businesses simply call the incumbent phone company in their area and get set up. It’s the easy thing to do. Call Ma Bell, get a phone line or two, perhaps a fax line, and then buy some phones. The downside? That service now costs roughly $50 a month depending on where your business is located.

$50 a month for the privilege of making and receiving phone calls. Ridiculous.

Many of you have heard of Voice over IP (VoIP) in its various incarnations whether it’s Skype, TekSavvy’s TekTalk service, RingCentral, or Google Voice. The most popular flavour of VoIP is called a SIP trunk, which boils down to an Internet-based replacement for traditional landlines.

Calling it an Internet-based replacement is a bit of a generalization though. The signal certainly travels over the Internet for a period of time, but as soon as it hits the provider’s infrastructure, the conversation then traverses a private network. This private network is shielded from the typical jitter and packet loss you can experience with consumer-grade, very low cost solutions.

The benefits? Depending on the SIP trunk provider, prices range from $20-40 a month. Even on the high end, you could be saving your business $120 per year, per line. That increases exponentially if you can replace multiple phone lines with a few SIP trunks instead. Of course there are a few things to consider before replacing landlines with SIP trunks, such as:

  • Your business needs a high speed Internet connection – each phone call typically requires 128kbps (that’s less than watching a YouTube video)
  • If your business’ Internet connection is DSL, you’ll need to get the ISP to turn on dry-loop DSL or switch to cable Internet
  • If you don’t have high speed, make sure you put together an report comparing your existing expenses with the potential expenses to make sure it still makes sense to make the switch
  • If you don’t have an Internet connection, there are other reasons for installing one
    • You can switch to a high speed debit/credit terminal, eliminating the need to wait for debit/credit transactions to finish before making a call
    • You can also use the opportunity to eliminate a traditional fax machine with an IP fax service, driving further efficiencies
  • If you want to keep your existing phones, you will need to purchase a voice gateway – this voice gateway converts the connection from a digital to analog signal, making your traditional phones useable

There can be start-up costs, but these are minimal. The long term advantages in cost and time typically weigh heavily towards replacing traditional landlines with SIP trunks. In addition, business-oriented VoIP providers provide very high quality phone calls. Calls on SIP trunks are so good some customers have said they’re even clearer than traditional phone calls.

This is just the first in a series of blog entries designed to help small businesses make incremental steps towards increasing their use of new business-oriented solutions and applications. Our intent is to help small businesses save money, save time, and ultimately streamline and automate their processes so that they can spend more time running the business, and less time on non-revenue generating activities.

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