| In the process of helping small businesses with | | | | changes |
| their telephone and Internet needs, I have | | | | - Charges for additional wiring |
| observed over and over that they were making | | | | - Cost of additional phones |
| the same common mistakes in contracting for | | | | When you add up all of the costs associated with |
| telephone and Internet services, causing them to | | | | your system, you may find that you can save |
| pay significantly more than required on a monthly | | | | money by replacing your older system with a |
| basis. Further, I have found many situations in | | | | newer small office phone system, with a payback |
| which businesses were failing to make the | | | | often less than one year. |
| maximum use of the services they had. | | | | 6) Internet-based Phone Service |
| The purpose of this document is to discuss ten | | | | Using a properly-equipped phone system, you can |
| practical ways to reduce your monthly bill, or to | | | | get some or all of your phone lines supplied via |
| improve the cost effectiveness of the services | | | | the Internet, otherwise known as VOIP. VOIP |
| you already have. | | | | lines are significantly less expensive than a regular |
| 1) Overtrunking. | | | | phone line, and as an added benefit, can often be |
| This sounds like a complicated term, but it simply | | | | up and running within an hour of your order. |
| means that you have more phone lines than you | | | | Internet-based lines can also allow you to receive |
| need. Phone companies love to sell phone service | | | | multiple incoming calls for a flat monthly fee, |
| in packages of multiple lines, and they want you | | | | keeping your customers from ever getting a |
| to pick the number of lines you think you will | | | | busy signal. |
| need in two years, rather than what you need | | | | Make sure to select a business-class carrier for |
| today. | | | | your Internet-based phone service, to ensure the |
| Don't fall for these tactics! Buy the number of | | | | best possible quality of service. |
| lines you need today. You can add more lines in a | | | | 7) Direct Inward Dial |
| matter of a few days if needed. Generally, a | | | | Direct Inward Dial, or DID, allows for a specific |
| business needs one phone line for every four | | | | phone number to be assigned to each user on a |
| people they have in the office, with one extra. | | | | properly-equipped phone system. Callers can then |
| So, if you have four employees, two, or at most | | | | reach the person they are calling directly, without |
| three lines should be sufficient. | | | | having to go through a receptionist. This saves |
| One of the challenges of having more employees | | | | you time and money by not having to use an |
| than lines is that you need a way to share the | | | | employee to answer phones and direct traffic. It |
| lines you have. You can use a small-office phone | | | | also gives your customers quick access to the |
| system to efficiently share lines, and such a | | | | person they need. |
| system will often pay for itself in less than a year | | | | You can also use DID to monitor the result of |
| if it allows you to reduce your number of lines. | | | | your ad campaigns, by assigning a different DID |
| 2) Eliminate Dedicated Fax Lines | | | | number to each campaign. You will know the |
| In most cases, businesses today are paying for | | | | source of the referral based on the number that |
| at least one dedicated fax line. Except for very | | | | was dialed. In the same way, businesses can |
| unusual circumstances, you can easily do without | | | | assign unique DID numbers to departments and |
| this. A number of companies now offer for a few | | | | divisions. |
| dollars a month a dedicated fax number. When | | | | 8) Reduce Long Distance Charges |
| someone sends a fax to this number, it | | | | In today's market, long-distance phone service |
| automatically shows up in your email box - | | | | provided by a major carrier costs approximately |
| wherever you are. As an added advantage, each | | | | 5 cents per minute. If you use VOIP, you can cut |
| of your employees can have their own number, | | | | this rate significantly, in some cases by half. |
| saving someone from having to sort and | | | | 9) Reduce Cell Phone Usage |
| distribute inbound faxes. Another option is a phone | | | | Cell phones have become critical to operating a |
| system that will automatically detect an inbound | | | | small business, whether used to stay in touch with |
| fax on any line, and route it to a fax machine. | | | | customers, or with staff members. Unfortunately, |
| For outbound faxes, it is easy to share one of | | | | cell phones can be very expensive, and should |
| your other lines for this purpose. | | | | only be used when appropriate. In too many |
| 3) Eliminate Services That You Don't Need | | | | cases, I see businesses using cell phones because |
| Another way phone companies take advantage | | | | they don't have a good phone system handling |
| of bundling is to add services to the package such | | | | their call traffic. |
| as inside wiring maintenance, call waiting, voicemail, | | | | By making your cell phone an extension on a |
| etc. These services are fine if you really need | | | | phone system, you can ensure that only calls that |
| them, but very often, you are paying for | | | | actually need to go to your cell phone actually get |
| services you don't need and will rarely use. Some | | | | there. You can also place calls from your cell |
| examples are listed below: | | | | phone through your system and save money on |
| Inside Wiring Maintenance - This is an optional | | | | long distance. |
| charge you pay to have the phone company take | | | | 10) Get Carriers to Compete for Your Business |
| care of the phone wiring inside your office. It is | | | | You would not think about making a major |
| similar in concept to an extended warranty, which | | | | purchase without comparing prices from multiple |
| rarely makes sense. Wiring generally does not go | | | | vendors. As such, why should you purchase |
| bad, and if you do need maintenance, it is usually | | | | phone or Internet services without competing |
| cheaper in the long run to pay a vendor to do | | | | quotes from multiple vendors? |
| this. In addition, the "fine print" often limits what is | | | | One of the reasons that phone service is so |
| actually covered. | | | | expensive today is that the Bell companies had a |
| Call Waiting - This is a wonderful service, but in a | | | | monopoly for so many years. Now, when |
| business, it is usually more trouble than it is worth. | | | | competitive carriers and pricing are available, |
| Can you imagine putting a large customer on hold | | | | many businesses are still in monopoly mode, and |
| to respond to a call waiting beep? | | | | thus order phone service from their local phone |
| Voicemail - Your business likely needs some | | | | company without obtaining competing quotes. |
| approach to taking messages when nobody can | | | | Never order any phone or Internet service |
| answer the phone, but the phone company's | | | | without getting a competing quote from other |
| voicemail service is seldom a cost-effective way | | | | carriers. Since it can be a challenge to figure out |
| to accomplish this. A small office phone system, | | | | which vendors service your area, use a |
| or a multi-line answering machine will usually make | | | | carrier-independent company to get quotes for |
| more sense. | | | | you. |
| 4) Cramming | | | | Also, beware of multi-year "discount plans" with |
| If you look closely at your phone bill, you will | | | | phone companies. These are often used to lock |
| often find charges for services you did not order, | | | | you into a higher price, preventing you from easily |
| and do not want. In an effort to increase their | | | | taking advantage of reductions in costs or new |
| profits, phone companies will add items onto their | | | | technologies. Remember, telecom and Internet |
| bills on behalf of other companies. These charges | | | | costs are trending down, not up, so locking in a |
| do not necessarily relate to your phone service. | | | | rate for two or three years seldom makes sense. |
| One common cramming situation I see involves | | | | Bonus Cost Saving Idea: |
| Internet search engine enhancement, where a | | | | 11) Advertising on Hold |
| company charges you to help with your search | | | | Once you get customers or prospects to call |
| engine ranking. We find that many companies are | | | | your business, you should take maximum |
| paying for this when they don't even have a web | | | | advantage of the opportunity to help them |
| site. | | | | understand your business and products. Consider |
| Check your bill carefully, and question any charge | | | | using advertising on hold to clearly communicate |
| that you don't understand. If you are not | | | | your message to your callers. The equipment to |
| comfortable doing this, get help from a company | | | | play your advertising message to callers is |
| that specializes in phone bill analysis. | | | | inexpensive, as is professional recording services. |
| 5) High Total Cost of Ownership (TCO) | | | | In summary, there are many ways to save |
| If you have a phone system, you need to be | | | | money on Internet and telecom costs, and few |
| aware of how much it costs you to operate that | | | | small businesses are taking advantage of all of |
| system on a yearly basis, particularly if you have | | | | them. In today's soft economy, it is more |
| an older system. When calculating the overall TCO | | | | important than ever to squeeze every extra |
| for a phone system, consider the following: | | | | penny out of your routine operating costs. By |
| - Yearly maintenance contract cost | | | | using the above tips, you can potentially save |
| - Average yearly service calls and repair costs | | | | significant money, beginning today. |
| - Cost for vendor to do moves, adds, and | | | | |