Ours is an era of proliferating communications platforms. Email, web-based chat support, messaging through social media – all are heralded as low-cost effective ways for businesses to “stay connected” with customers. Nonetheless, real-time voiced communication – or in other words, the phone – is still a very powerful tool for business communications, and an office of any size would be more efficient with a full-featured phone system.
Once you’ve decided that a phone system will enhance your business communications, you must choose between two options: whether a) to purchase a phone system, or b) to opt for a hosted solution. During this decision-making process, you should consider your business’s lifecycle stage, as I’ll explain further.
PBX: The “Brain” of the Phone System
A phone system is much more than the ringing handsets like the one sitting on your desk at the office. Handsets are a relatively minor investment compared to the PBX, or brain, of the phone system. The PBX is the computer responsible for everything that makes modern phone systems indispensable to office productivity: the auto attendant, caller ID, conference calling, voicemail-to-email forwarding, etc. So what are the cost considerations to keep in mind when deciding between purchased PBX vs. hosted PBX ?
Cost Considerations: Purchased vs. Hosted
Choosing hosted PBX makes for a relatively small up-front investment as your only initial cash outlay is for handsets. Typically, though, your recurring monthly costs for phone service will be higher with a hosted provider than if you had purchased your own PBX. That’s because with a hosted solution, you will be required to pay for phone service per seat, rather than per trunk. (A seat is one extension; a trunk is a line leading into the PBX and capable of servicing many seats). Stated another way, buying a PBX saves you money in the long run, as it allows you to purchase phone service wholesale, or by the trunk.
A couple of other considerations related to your stage in the business cycle: for more established businesses, there are the obvious tax benefits of buying your own equipment. For smaller business and startups, the minimal maintenance costs of hosted PBX are a plus (as system maintenance is the host’s responsibility).If, ultimately, you opt for a hosted PBX provider, choose one whose technical support staff are local vs. offshore, ideally one that sells phone systems from a well-known manufacturer. (This will come in handy should you decide to switch providers, or to purchase a PBX of your own, down the road.)
Despite the wide variety of communications options available today, the phone remains an important tool for doing business. If you are an established company and intend to use your phone system for years, the money you save on monthly service will soon more than cover the cost of purchasing your own PBX. However, if you are a startup, the need to keep capital expenditures to a minimum while solidifying your financial footing may make hosted PBX a better solution.
Locally-owned & located in Downtown Bend BendTel provides a complete solution for all business communications needs – from phones to fiber-backed Metro Area Ethernet.