Choosing the right phone solution for your business is crucial. It will affect your team’s ability to answer and make calls efficiently. It will also affect the quality of customer support you can provide. There are three main types of small business phone systems and plenty of providers to choose from. We will explore the pros and cons of each type and each phone system provider to help you to conclude what is the best small business phone system for you.

What is a business phone system?

A business phone system is a service your business uses to receive and make phone calls to liaise with suppliers, communicate within the team, and support customers. Businesses no longer have to rely on landline phones and headsets that tie them to their desks. You can run a secure and streamlined phone system using cell phones.

Additionally, communication has developed beyond voice calls to an omnichannel approach including text messaging, online messaging, emails, and video meetings. Many phone service providers offer these add-ons to create a fully integrated communication interface.

The 9 Best Phone Systems for Small Businesses

1. Podium

Podium helps you to turn more customer calls into revenue with a modern phone system that is integrated into a truly omnichannel inbox alongside texts, social media, and even your Webchat. The interface is so well integrated because Podium also offers a webchat, text messaging service, and other reputation management tools such as online review software. The essential plan starts at $249 a month for 3 team members and 1000 contacts and includes their payment system so you can close sales on calls.

2. RingCentral

RingCentral offers businesses cloud-hosted PBX with plenty of advanced features to customize the phone system for business needs. Their core phone system starts at $30 a month. However, it has to be said their core plan has limited features and you can’t mix and match so you need to be on their top plan to get the best customization and support.

3. Nextiva

Nextiva focuses on providing high call quality and simplifying business communication. It’s great for businesses that handle sensitive data such as healthcare businesses because it has HIPAA-compliant features. You can mix and match their plans, starting at $17.95 a month, to get the best custom plan for you. However, you have to be on the top plan to get the feature of voicemail transcription.

4. Ooma

Ooma’s essential plan, costing $19.95 per user per month has 50+ standard features, making an advanced phone system accessible to start-ups from the go. It’s known for having a user-friendly interface and quick onboarding so you can get started ASAP. Although, on the essential plan, you don’t get access to key features such as video communication and integrations with Google and Office 365.

5. Zoom

While Zoom is known for its video calling capabilities, it also has a phone service with two distinct plans. They have a pay-as-you-go plan which is perfect if you’re just getting started. They also have an unlimited calls plan which is perfect if you know you’ll be managing a high volume of calls. If your company has global contacts, keep in mind that international calling doesn’t come as standard.

6. 8×8

This is the phone service for global businesses. With 8X8, you can get local numbers all over the world and unlimited international calling. Plus, video communication supports 46 different languages. While it’s well-suited for business with international contacts, it doesn’t have the best basic entry-level plan for getting started.

7. GoTo Connect

This phone system is made for businesses with globally distributed teams. Their two simple plans can be customized with add-ons to create a communication system that ‘works the way you do’ and supports collaboration within the team. If you’d like to add a toll-free number to your plan, be aware that available minutes are limited.

8. Dialpad

If you’re AI-curious, you’ll be intrigued by Dialpad’s business phone service. AI features are included in every plan such as AI-powered voicemail transcription. Despite this, the starter plan is relatively affordable at $15 a month if billed annually. However, toll-free numbers do not come as standard.

9. Vonage

Vonage has advanced capabilities that make it customizable and scalable, starting with a metered plan as well as offering unlimited calls for larger enterprises. The pro plan includes a virtual receptionist for call rerouting. The main drawback is that you have to enter into a year-long contract with early termination fees.

Types of Business Phone Systems

As well as choosing a service provider to deliver unified communications, you also need to choose the type of office phone system you want to invest in. Three main types vary in terms of functionality and advanced features.

1. Key System Unit (KSU)

A KSU business phone system is the most basic of business phone systems. Think of it as a step up from a standard home phone. Phones operating with a KSU system will typically have buttons and displays to choose lines, use intercoms, call extensions, put people on hold, and more. Lights illuminate when a line is in use. These business phone systems usually have a central switching device that needs to be professionally installed and maintained.

The Benefits of KSUs

They are very easy to use, reducing the learning curve and necessary training for its users.
They usually work with your current phone wiring, reducing the cost of installing the business phone system.
Repairs are usually affordable.
They offer all the basic features you need, including memory dialing, timers, speakerphones, paging, hold buttons, intercoms, and more.
Some modern KSUs use VoIP.

The Cons of KSUs

The business phone system is not portable, and neither are the phones, limiting its use to on-premises with desk phones.
These systems are not very scalable.
There are limited customization options.
You must pay for installation and maintenance, both of which should be done by a professional.

What About KSU-Less Systems?

There are also phone systems called KSU-less systems. These are similar but wireless, and you don’t need a central switch or cabinet. Each phone has all the circuitry it needs to deliver all of the features.

Pros

They require less wiring, making them affordable, portable, and easier to install and maintain.
You can easily move or sell a KSU-less phone system.
A single point of failure is less likely to cause company-wide communication issues, contrary to the possibilities with a KSU system. With KSU-less systems, the damage only affects a single unit.

Cons

They are not scalable at all. You can typically include only four to eight phone lines in a KSU-less system, making them a good choice only for very small businesses.
You will not get all the features you need from your business phone system. For example, you can only make one call at a time. You also don’t get call tracking and voicemail.

2. Private Branch Exchange

Another common type of small business phone system is a private branch exchange (PBX). This type of system lets you share business lines between internally installed phones. There are several outside lines (called trunk lines) that all employees share. In other words, you don’t need external lines for various internal phones to reach each other. Simply put, it lets multiple people connect without having to use the public switched telephone network (PSTN).

The Benefits of PBX

Monthly costs tend to be low.
You have more control than you do with a KSU system.
The business phone system can integrate with CRM software and other programs.
You can also connect modems and fax machines to the system.
You get even more features than KSUs, including automated features.
You can assign functions to individual lines.
PBX systems are more scalable than KSU systems.
They are available as cloud-based systems, which are sometimes closer to VoIP systems. VoIP PBX phone systems are even available.

The Cons of PBX

Initial installation, hardware, and software costs are high.
You need to manage the system internally, which requires expertise and adds to the cost.
There will be maintenance costs.
Power outages can lead to downtime.
Scalability is still not great, especially across multiple sites.

You are responsible for the network security of these phone systems.

2. Voice Over Internet Protocol (VoIP)

Voice over internet protocol (VoIP) systems are easily among the most popular business phone systems. Among the list of the best small business phone systems, VoIP lets you include a long list of features you can’t get with the others because it relies on the internet. As of 2021, the industry was worth $85 billion and is expected to reach $102.5 billion by 2026.

The Benefits of VoIP

It makes useful features and add-ons accessible to companies of all sizes. Some of these features include music on hold, voicemail-to-email, conference calls, call recording, and auto attendants.
Features like auto attendants let your team work more efficiently, potentially reducing the number of team members you need.
This is the most affordable type of phone system in terms of initial installation and continued use, especially when it is completely independent of a KSU or PBX system.
Your VoIP provider can install this cloud-based phone system incredibly quickly, especially if you have a strong Wi-Fi connection.
The system is portable, only requiring a stable internet connection. This allows for remote work or access to the system when visiting clients or going off-site.
You can access the phone system on any internet-connected device, including tablets, computers, smartphones, and nearly any other internet-enabled mobile device.
The systems are very easy to scale because the lines are digital, not physical. This is good for permanent and temporary increases in your needs, such as adding a new location, increasing the number of users, or preparing for a spike in call volume during the holidays.
You can also add features without having to buy new hardware, reducing the costs when you scale up.
Business VoIP systems let you send documents, videos, and images while talking. Some even support video conferencing or work with programs that do.
Better, clearer quality of calls, improving the customer experience, and reducing your team’s frustration.
Large enterprises can feel more approachable with a VoIP system.
Small companies, including those with limited manpower, can get the features of a large enterprise. And the auto attendant feature can make your company appear larger and more professional.
VoIP tends to be more secure than other traditional phone systems such as a landline phone, thanks to encryption and other features.

The Cons of VoIP

You need a strong internet connection. Latency and jitter can be concerns if your connection isn’t fast enough.
If the power or internet goes out, so does your VoIP service.
The team still needs to be provided with up-to-date hardware – a cell phone compatible with the phone service provider’s mobile app.
There is no location tracking if you make an outgoing call. So if someone calls 911, you need to provide the address; they can’t track it.

How to Choose a Business Phone System: 8 Features to Look for

For most companies, the best small business phone system will be a VoIP phone system. These systems are the most scalable and affordable, letting you increase your volume of phone calls as your company grows. They also incorporate the most features into your business phone system. Your ability to customize your phone system according to your business needs will enable you to experience improved efficiency. Using a virtual phone system also gives you the flexibility to answer phone calls from your mobile device, which proves useful to those always on the go.

When looking for a VoIP phone system as a small business owner, these are the key features you should be looking out for.

1. Call Forwarding

This is a great fallback if your customer representatives are struggling to keep up with the volume of calls. Instead of the call hanging up or asking them to leave a voicemail, the customer is automatically forwarded to another business phone number. This means they can still get through to someone when they first called.

2. Omnichannel Communication

Communication doesn’t only happen over phone calls these days. There are various other communication channels you can integrate with a VoIP phone. So whether you’d like to introduce team messaging with SMS capabilities or be able to transition from voice calls to a video conference to better support a customer, look out for an omnichannel interface in your chosen phone system.

3. Visual Voicemail

Listening to voicemails can eat up a lot of time for customer representatives. Streamline the process with voicemail transcription. The voicemails are automatically transcribed and sent to team members so they know who is waiting for a callback and can quickly assess who to prioritize.

4. Automated Callbacks

Difficulty reaching a customer representative is the main cause of frustration for customers using a small business phone system. Reduce frustration with automated callbacks. If the team is too busy to take the call straight away, the customer is asked the date and time they’d like the business to call them back. Then the phone system will add the customer to the call queue of a customer representative at the chosen date and time, eliminating the need for waiting or repeated attempts to get through.

5. Integrations

What other systems does your team use when interacting with each other and customers? Salesforce, HubSpot, Google Workspace? Have these in mind when choosing your call management system because many service providers will offer integrations with popular business tools, allowing you to streamline and automate processes.

6. Call Analytics

A lot of useful insights can be gained from reporting call data on both customer and agent behavior for continued improvement as well as effective planning for the future. The kind of analytics that can be collected about a given period from your contact center include call volume, call abandonment, and First Call Resolution Rate (FCR).

7. Call Transfer and Call Routing

For a call to end with a satisfying resolution, the caller needs to be talking to the right person within the relevant department, with appropriate access and skillset. Call routing helps with transferring the caller to this person. It puts in place Interactive Voice Response (IVR) prompts that will establish the department, access, and skills needed and automatically transfer the caller to a suitable representative.

8. Cloud-based Capabilities

Hosting your IP phone system in the cloud comes with a lot of benefits. Cloud systems have advanced security, encrypting personal data, and enable additional features like video calling. As it is hosted on the cloud, it is accessible from softphones anytime, anywhere.

All-in-One Small Business Communication & Growth Solution

Podium is well-equipped to improve your communication internally and externally. We offer a VoIP service for all your phone call needs. Our toolkit also includes our omnichannel inbox where you can review all your communication channels in one place including text, social media, online reviews, and of course phone calls. From nurturing new leads to supporting existing customers to closing repeat sales, keeping in touch with your audience is easy.

With all the conversations going on and the people you’ll be in contact with, it’s important to stay organized for a smooth transition throughout the customer journey. A spreadsheet just won’t cut it. So invest in our CRM software built for small businesses. Keeping your contacts organized elevates the customer experience.

Get started with Podium Phones today if you’re ready to take your phone strategy to the next level.

FAQs

What is the best business phone system?

When finding the small business phone system that’s best for you, look out for key features including call forwarding, call routing, integrations, and omnichannel communication. The Podium VoIP phone system connects with an omnichannel inbox where you have access to all forms of communication within the business, streamlining customer communication.

What are the benefits of business phone systems?

Business phone systems can customize the functionality, add-ons, and integrations that fit your business needs. For example, some phone systems have both a desktop app and an iOS and Android app for mobile phones so the team can work in-office or on the go. Advanced features are also available for IVR-directed call transfers, automated callbacks, and visual voicemails, speeding up and streamlining the communication between customers and companies.

What is the difference between a business phone service and a business phone system?

There are different types of phone systems, the main ones being Voice over Internet Protocol (VoIP), Key System Unit (KSU), and Private Branch Exchange (PBX). Each one of these can be delivered by different service providers, each with different functions, features, and pros and cons.

The 9 Best Small Business Phone Systems + How to Choose

Streamline your entire business.

Get started now