When it comes to business phone systems, small businesses can choose among three basic types: key phone system, private branch exchange (PBX), and Voice over Internet Protocol (VoIP).
In this blog, we'll discuss each type and their respective pros and cons so you can decide which business phone system is best for your company.
Key phone system
A key phone system, or key system for short, is the oldest and simplest multiline business phone system among the three types. It is landline-based, which means it transmits signals converted from audio data through physical wires or cables. Setting up a key system requires having a service professional install a hardware system called a key system unit (KSU) on your company’s premises. A KSU is a central switching device that manually determines which phone line to use.
This phone system is suitable for small businesses that have no more than 40 phone operators since it can handle only a limited number of phone lines. These lines are each represented as buttons on a key system phone set. To make a call, users need to pick up the handset and press a button, which allows them to access a line. The corresponding button will light up, indicating that the line is in use.
The great thing about key phone systems is that they are significantly less expensive than PBX. However, they come with only basic analog features, such as on-hold buttons, speakerphones, and an intercom. Since a key phone system lacks advanced features and has limited phone lines, you may be forced to replace it as your business grows.
Moreover, the setup and maintenance of key systems can be costly since they require a service professional to work on site. Finally, key phone systems cannot offer mobility since they need to be connected to the KSU.
Private branch exchange (PBX) system
A PBX business phone system uses a programmable switching device, enabling automatic routing of incoming calls between users on a local network. It also allows users to make internal calls via extensions and share a pool of external lines or trunks for local, long-distance, and international calls.
A key advantage of a PBX system is that it can handle hundreds of phone lines, making it well-suited for organizations with huge call traffic. Unlike a key phone system, a PBX phone system offers advanced call features, such as call queuing, conference calling, automated attendants, music on hold, and call recording. What’s more, it comes with an uninterruptible power supply, so it would remain functional up to a certain time during a power outage.
Unfortunately, when you factor in the cost of hardware and professional setup services, the upfront investment required for a PBX system can be prohibitive for many small businesses.
Voice over Internet Protocol (VoIP) system
A VoIP business phone system uses digital technology to convert voice into data packets and sends them over the internet instead of traditional telephone networks. This significantly reduces communication costs, making it ideal for organizations that make long-distance and international calls. Not only that, but this also allows users to make and take calls from any internet-connected device that has a microphone and speaker — perfect for remote workforces.
Read also: 4 Ways VoIP can benefit remote workforces
Even the most basic VoIP service plans are packed with features, such as caller ID, voicemail, call forwarding, call queuing, three-way calling, and music on hold. Most business VoIP packages already include advanced features such as automated attendants, voicemail to email, audio and video conferencing, find me/follow me, and call recording.
Moreover, unlike traditional landlines, most VoIP services are easy to install, configure, maintain, and use. And since there's no physical installation required, you can easily scale up or down your VoIP service plan to meet your current needs.
Take note, however, that a VoIP system requires a stable internet connection to work effectively, so you need to ensure that your network has adequate bandwidth to handle the call traffic.
Which business phone system should small companies use?
Small businesses are better off subscribing to a VoIP service plan. It allows them to enjoy benefits such as mobility, advanced call functionalities, ease of setup and maintenance, and scalability without breaking the bank.
When you partner with outsourceIT for your VoIP needs, we’ll handle everything from planning, installation, configuration, and maintenance of your VoIP system. Schedule a FREE consultation with us today.