SHARE

Ready to upgrade your business phone system?

Given today’s seemingly limitless options, choosing the right business phone system, reviewing available pricing structures to determine the best value, and even understanding what makes one provider better than another certainly feels overwhelming.

Read on to learn more about the different types of business phone systems, find out key features to look for, and compare top providers.

 

What is a Business Phone System?

A business phone system is a multi-line VoIP telephone software that provides scalable, flexible, and affordable internal and external business communications–plus advanced features that streamline business processes. 

Unlike home phones or personal cell phones, business phone systems include unlimited extensions, call flow options, and call management features that make it easy for customers to reach multiple departments, agents, or IVR menus via the same telephone number (though multiple business phone numbers are also available.)

VoIP (Voice over Internet Protocol) solutions may also give businesses access to multiple communication channels, not just voice calling. Video conferencing, SMS text messaging, team chat messaging, and virtual faxing are a part of most business phone systems today.

 

Best Small Business Phone Systems

Based on our hands-on experience, the quality of features, feedback from customer reviews, and our industry expertise, we’ve ranked the following business phone systems to help you make the right choice.

Here are the best business phone systems you should consider:

 

Nextiva: Best Business Phone System For Remote Teams

Nextiva is a cloud-based unified communications platform that combines VoIP voice and calling, team collaboration, CRM tools, and more into the Nextiva Business Communication interface.

Key phone system features include: 

  • Call screening, parking, forwarding, routing, and recording functionality
  • Visual voicemail and talk-to-text
  • Unlimited voice calls in the United States and Canada
  • Auto attendants and IVR call menus
  • One-click conference calling for up to 200 participants
  • Real-time/historical call analytics

 

Top Features

Unlike other business phone service providers, Nextiva includes its own native CRM suite for both sales and customer service teams. Agents can access features like intelligent case routing, workflow automation, and Nextiva Call Pops, which instantly display key customer account information during calls with clients.

Nextiva Workhub Launch, GetVoIP News

 

Nextiva’s Cospace feature is a desktop and mobile virtual workspace included with all Nextiva business communication plans.

Cospace is a unified application for file sharing and editing, real-time chat messaging, voice calling, audio conferencing, and video calling.

Nextiva COspace

Up to 250 participants also have access to a team calendar, persistent chat, screen sharing, task management, and meeting scheduling tools within Cospace.

 

Network Reliability And Customer Support 

Nextiva stands out for offering 24/7 phone, email, and chat support with all plans–not just the most expensive pricing tiers.

It also includes a 99.999% guaranteed uptime with 24/7 network monitoring, eight global points of presence, and HIPAA, HITECH, SOC2, and PCI compliance.

 

Plans & Pricing

Nextiva offers a 7-day free trial and three paid plans. The image below outlines pricing for 20-99 users.

Nextiva Pricing

 

For more information, check out our overview of Nextiva pricing and plans.

 

User Experience

The below table outlines the average Nextiva user experience.

What Users Like What Users Dislike
24/7 high-quality omnichannel support available to all users, not just those with the most expensive plan Essentials Plan lacks key features like CRM integrations, SMS, multi-level IVR, and external video calling
Robust mobile app empowers remote teams by providing access to voice and video calling, voicemail management, screen sharing, call routing, auto attendants, chat messaging, and more on-the-go High cancellation fees combined with lengthy contracts and expensive add-on/premium features like CRM connectors, agent wallboards, and IVAs

 

RingCentral: Best For Businesses Needing An All-In-One Platform

RingCentral MVP is a unified Messaging, Phone, and Video communications solution primarily designed to simplify and streamline agent workflows, increasing team productivity across channels.

Top voice calling features for small businesses include: 

  • Local phone numbers in 200+ area codes, international numbers in 100+ countries
  • Unlimited calling in the USA and Canada
  • Unlimited SMS, MMS and virtual faxing
  • Cross-device call presence monitoring
  • Automatic voicemail transcriptions, voicemail-to-text, and voicemail-to-email
  • RingOut one-click calling
  • On-demand and automatic call recording

 

Top Features

RingCentral is celebrated for its advanced–and highly customizable–real-time analytics.

Admins can use pre-made reporting templates that automatically monitor over 30 KPIs relating to agent performance, team meetings, quality of service, and more. Real-time alerts instantly notify managers when performance standards fall below pre-set thresholds. All call data can be filtered by call type, date range, agent, call queues, departments, and more.

RingCentral Analytics

 

Small businesses relying on self-service to manage the majority of customer support requests will appreciate that RingCentral allows for up to 250 single and multi-level IVR menus and submenus.

RIngCentral Voice Calls

 

Admins can edit call flow paths at any time with RingCentral’s drag-and-drop Visual Dial Plan Editor, take advantage of numerous call routing strategies, and rely on NLP and AI to automatically evaluate and respond to customer requests.

 

Network Reliability And Customer Support 

RingCentral offers 24/7 live chat and phone support on all its plans, with upgraded paid support options like dedicated account managers, priority support, and personalized implementation and team training via RingCentral Professional Services.

RingCentral University, its free online training program, provides a high level of customer self-support that is vastly superior to competitor knowledge bases.

Thanks to its geographic redundancy, 99.999% guaranteed uptime, 7 layers of network security, end-to-end encryption, multi-factor authentication, and fraud mitigation tools, RingCentral offers strong security and a consistently high call quality.

 

Plans & Pricing

RingCentral offers a free 15-day trial. The image below outlines RingCentral MVP pricing and plans for 1-20 users, and further details are available on our RingCentral Pricing overview.

RingCentral Pricing

 

User Experience

The below table provides a quick outline of the standard RingCentral user experience. 

What Users Like What Users Dislike
The RingCentral App for desktops is intuitive and easy-to-use, especially when compared to other VoIP providers More affordable plans lack essential integrations like Salesforce and Zendesk
Highly customizable analytics provide insight that helps to improve workflow and identify key issues as early as possible Limited hardware compatibility seems designed to force users to purchase new business phones from RingCentral directly

 

GoTo Connect: Best Business Phone System for Teams of 10 or Fewer

GoTo Connect is a small business phone system with a cloud-based voice, video, and chat messaging app designed for smaller teams that require scalable solutions, but don’t need especially advanced calling features. 

It comes with over 100 calling features, including:

  • Unlimited extensions and unlimited calling in the US/Canada
  • Audio conferencing for up to 10 participants
  • Individual and shared voicemail boxes
  • Call hold, call queues, unlimited ring groups, simultaneous ringing
  • Custom hold music, playlists, greetings, and messages
  • Directory Assistance

 

Top Features

GoTo Connect is best known for its Dial Plan Editor, popular for its overall ease of use and the advanced call routing and call flow strategies it offers.

GTC dial plan editor

Admins can create “utility nodes” according to agent schedules, preferred language, caller ID, user groups, and more. These nodes automatically shift according to call volume and agent availability, cutting down on the number of missed calls and callbacks. With unlimited auto attendants and submenus, pre-made recording templates, and customizable greetings, call and personalized.

GoTo Connect also includes call filtering tools that let users whitelist high-priority numbers so VIP clients avoid waiting on hold.

GoToConnect Queues

 

These filters also automatically forward VIP calls to specific preset dial plans or extensions–and automatically reject blacklisted numbers.

 

Network Reliability And Customer Support 

Unfortunately, GoTo Connect’s customer support is consistently criticized by both past and current users because of difficulty connecting with live agents and slow turnaround times. Even its website chatbot doesn’t offer much quality assistance.

This is especially frustrating as GTC heavily advertises its alleged “24/7 support,” but doesn’t specify that it’s only available to Standard and Premium customers.

Though GoTo Connect offers SSO and 2FA, it doesn’t provide end-to-end encryption. However, it has 10 global data centers to keep network performance consistent as well as SOC 3, CCPA, and HIPAA compliance.

 

Plans & Pricing

GoTo Connect offers a free 14-day trial, and the image below outlines pricing and plans for 2-10 users. Our GoTo Connect Pricing breakdown provides additional information.

GoTo Connect Pricing

 

User Experience

The table below provides insight into the GoTo Connect user experience. 

What Users Like What Users Dislike
GoTo Meeting video conferencing included with every plan Lack of third-party software integrations, and included integrations are often too industry-specific to be useful to many users
Integration with 180+ desk phones let small businesses keep existing equipment Mediocre customer support, including a lackluster online knowledge base, means teams must be willing to “solve their own problems”

 

8×8: Best Phone System For Small Businesses With International Clients

8×8 is a cloud PBX business phone system offering unlimited local and global calling in 48 countries, along with SMS, team chat, and video meetings. 

It’s compatible with over 25 PSTN carries, and top phone features include: 

  • Call recording+cloud storage (or Dropbox storage)
  • Native CRM tools
  • Multi-level auto attendant
  • Visual Voicemail
  • Call Queuing, Call Monitoring, and Ring Groups
  • Caller ID, Call Blocking, Do Not Disturb
  • Click-to-Call

 

Top Features

One of 8×8’s top features is its post-call survey tool, which includes IVR-powered questions that make it easy for customers to provide quick–but still valuable–feedback regarding agent performance.

8x8 post call survey

 

These surveys can pose simple yes/no questions, ask for ratings on a scale of 1-10, and allow willing customers to leave more detailed voice recordings of feedback. Teams needing more conversation-based feedback can automatically transfer customers to dedicated post-call survey voice channels or call queues.

8x8 auto attendant

 

8×8 also includes a variety of programmable ring patterns, including round robin, sequential, simultaneous ring, and more. Ring group members can be re-ordered via a drag-and-drop menu, and admins can set the amount of time before a call is forwarded to the next member.

 

Network Reliability And Customer Support 

8×8 phone support is only available Monday-Saturday from 6:00AM to 6:00 PM, which means it may not be ideal for businesses operating outside the standard Monday-Friday work week.

However, online tech support chat via the Otto chatbot is available 24/7. Users can also create support ticket request forms on the 8×8 website.

8×8 offers a 99.999% guaranteed uptime and has GDPR, HIPAA, CPNI, and FISMA compliance, along with TLS and SRTP encryption. The provider also has 35 global points of presence to keep the network running smoothly.

 

Plans & Pricing

8×8 offers a free 30-day trial, and pricing information is shown in the image below. Our comparison of 8×8 vs RingCentral offers more insight into how well the former stacks up against its competitors.

8x8 pricing

 

User Experience

The table below outlines the average 8×8 user experience. 

What Users Like What Users Dislike
Advanced, AI-powered analytics, including Active Call monitoring, Company Summary, and Call Detail Records Higher learning curve than most providers, especially regarding auto attendant and IVR configuration
Extension-level call recording, on-demand or automatic call recordings and transcriptions Some key features like Intelligent IVR, Quality Management, and Interaction Analytics available only with expensive paid add-ons

 

Dialpad: Best Small Business Phone System to Handle High Call Volumes

Dialpad’s business phone system provides excellent value to small businesses with high call volumes but without the current budget to hire additional agents. It includes voice and video calling, team chat, virtual faxing, and SMS texting. 

Voice calling features include:

  • Call recording and real-time transcription
  • Automatic spam detection
  • Call Routing, Call Forwarding, Call Failover
  • Visual Voicemail
  • Unlimited US and Canada Calling
  • Click-to-Call
  • Multi-level auto attendant

 

Top Features

One of Dialpad’s top features is its AI-powered in-call voice assistance, Vi (short for “Voice Intelligence.”)

 

Vi offers real-time agent coaching, picking up on potential action items and caller sentiment according to trigger keywords and phrases. When Vi “recognizes” something a customer says, it pulls up relevant information from the internal knowledge base, displaying vital information on the agent’s screen. This prevents agents from putting callers on hold, and increases first-call resolution rates.

Users can also create Dialpad Departments, which are essentially more advanced ring groups. Departments are groups of agents that receive specific customer calls based on preset criteria. Each Department can contain up to 30 phone numbers.

Dialpad Department

 

Department Operators have admin privileges, but only within their specific Department. Operators can view real-time call transcripts, set Department schedules, access call recording and call barge, and set up failover numbers in the event of a service outage.

 

Network Reliability And Customer Support 

Dialpad offers a 99.9% uptime guarantee to all customers except those on the Enterprise plan, who have a 100% guaranteed uptime.

With built-in network redundancy, number failovers, and automated data backups, Dialpad offers a high level of reliability.

All Dialpad Pro and Enterprise users have 24/7 phone support, and all other plans include 24/7 chat and online ticketing. Support add-ons are available for purchase, and include a dedicated account manager and professional deployment services.

 

Plans & Pricing

Dialpad offers a free 14-day trial, and the image below outlines available plans. Our Dialpad Pricing overview offers further details.

Dialpad Pricing & Plans

 

User Experience

The table below offers insight into the Dialpad user experience. 

What Users Like What Users Dislike
Automated post-call notes and speed coaching help agents understand where they need to improve Most affordable plan only offers integrations with Google Workspace and Microsoft 365
Each plan includes call recording, call transcriptions, and custom routing options that are usually reserved for top-tier plans More advanced plans require users to purchase either 3 or 100 licenses

 

Vonage: The Scalable Small Business Phone System

Vonage offers two options for small business phone systems: the unified Vonage Business Communication (VBC) suite or scalable communication APIs that allow users to add new channels and features a la carte. 

Vonage offers over 50 VoIP features, including:

  • Click-to-call
  • Call blocking
  • Agent Directory
  • IVR and virtual receptionist
  • ACD
  • Call park, call flip, call queueing, call waiting
  • Shared line appearance
  • Call spam shield

 

Top Features

Vonage’s Call Announce feature automatically plays customers’ responses to IVR prompts to agents before they connect to the customer, preventing repetition and ensuring the agent has the information they need to best assist the caller.

Vonage Calling

 

Call tags, summaries of the customer’s issue, contact information, and more are played, allowing the agent to transfer the call to an agent with a more appropriate skill set if needed. If an agent chooses not to accept the call, they can send calls to voicemail or reject it outright.

Vonage CA

 

The Conversation Analyzer is an AI-powered tool that uses NLP and Speech Analytics to automatically transcribe conversations, offering insight into support quality, call resolution speed, and customer satisfaction levels. Admins and business owners can search transcriptions for keywords, and can even connect it to their third-party CRM tool for additional data analysis.

 

Network Reliability And Customer Support 

Vonage’s lack of adequate customer support is a common user complaint, with reviewers citing slow response time and the fact that Vonage makes it difficult for customers to connect with a live agent for billing questions.

Additionally, there is conflicting information on support hours. Though Vonage claims to offer 24/7 support, their website states that their live chat support team is not available on evenings and weekends, and that phone support is limited in the evenings.

Vonage is HIPAA, PCI, and GDPR compliant, and uses AES 256-bit encryption. It has a 99.999% guaranteed uptime.

 

Plans & Pricing

As of this writing, Vonage does not offer a free trial. The image below outlines Vonage Business Communication tool pricing for 1-30 users. Our extensive review of Vonage Pricing offers more details.

Vonage Cloud Pricing & Plans

 

User Experience

The table below offers insight into the Vonage user experience. 

What Users Like What Users Dislike
On-demand, company-wide, and automatic call recording rules store up to 15 hours of audio/video per extension and allows admins to email recordings or play them directly in the Admin Portal General lack of onboarding support, requires customers to pay for specialized onboarding assistance
High scalability thanks to add-ons like Visual Voicemail, Call Queuing, Call Recording, Call Monitoring, Call Groups, and more Audio conference calling is only available for up to 30 participants

 

Zoom One: For Current Zoom Users That Need A Business Phone System

Zoom One is an all-in-one communication and collaboration tool combining Zoom Phone, Zoom Meetings, team chat messaging, and collaboration tools in one interface. Though a Free Plan is available, it doesn’t offer any voice calling features and focuses primarily on video calling.

Zoom One Phone features include: 

  • HD call quality with noise and echo cancellation, plus typing noise suppression
  • Visual Voicemail
  • Toll-free numbers
  • 3-way ad hoc conference calling
  • Automatic and manual call recording
  • Shared Line Appearance
  • Unlimited auto attendants and IVR menus

 

Top Features

Most Zoom One users upgrade to the unified communications plan from Zoom Meetings because they need a more advanced business phone system. Therefore, the team collaboration features Zoom offers are generally the biggest draw.

Zoom Whiteboard

Zoom One offers unlimited whiteboards, unlimited calling, 10 GB of cloud storage, and meeting capacities of up to 1,000 participants. 

Zoom is also celebrated for its huge number of third party-integrations and APIs.

Zoom Apps

 

Even though Zoom Phone itself is a bit more basic than most options in this piece, the fact that it can integrate with virtually any CRM, project management, marketing, or workforce management tool makes it one of the most customizable communication tools on the market today.

 

Network Reliability And Customer Support 

In addition to 256-bit encryption, Zoom offers Single Sign-On, FEDRamp, SOC 2, GDPR, and HIPAA compliance. However, Zoom doesn’t offer (or at least, publicize) a guaranteed uptime. However, its global points of presence and live systems monitoring page suggest a high degree of reliability.

Zoom One Customer Support is excellent, offering 24/7 chat with a live agent for all users. Though 24/7 phone support is available only for top-level plans, Zoom’s extensive online knowledge and thriving user community allow for a high degree of self-service.

Plans & Pricing

The image below outlines available Zoom One pricing and plans, and our piece on Zoom Phone provides more pricing information.

Zoom One Pricing

 

User Experience

The table below outlines the Zoom One user experience. 

What Users Like What Users Dislike
Large number of third-party integrations and APIs, plus frequent additions due to Zoom’s overall popularity Lack of a shared voicemail box for call groups can slow down the callback and resolution process
Advanced video calling features streamline remote team collaboration within a familiar, intuitive interface Phone call analytics need improvement, as of this writing, still limited compared to most providers

 

Ooma: Best Out-of-the-Box Small Business Phone System

Ooma is one of the more basic small business phone systems on our list, but it’s a solid choice for teams that want to continue using their existing analog hardware, need an affordable cloud calling tool, and want to avoid an extensive installation and setup process. 

Its calling features include: 

  • Virtual extensions
  • Ring groups
  • Virtual Receptionist
  • Basic analytics and call logs
  • Hold music
  • Call parking
  • Call recording

 

Top Features

Ooma is well-known for its mobile app, which is surprisingly robust for a more basic phone system.

Mobile users can transfer and flip phone calls from a softphone desktop app, send messages to groups, access voicemails, make international phone calls, connect with team members via in-app extension dialing and conference rooms, and update Ooma user preferences.

Ooma Call Transfer Tree

 

Ooma also automatically creates a virtual receptionist upon installation, which can be customized with text-to-audio menu options, language preferences, ring groups, call routing strategies, and different modes for after-work hours.

ooma caller info match

Its Caller Info Match feature works with your existing CRM system to provide call pop ups of customer contact information, account overviews, order history, and more.

 

Network Reliability And Customer Support 

Ooma offers 24/7 customer support via live chat, and phone support from Monday-Friday from 7:00 AM to 7:00 PM, and Saturday/Sunday from 8:00 AM to 5:00 PM.  It also includes a somewhat clunky online user knowledge base.

Unfortunately, Ooma offers little insight into their network reliability and security processes, but does explicitly state it is not HIPAA compliant and that it has “multiple connections” to Tier-1 international carriers.

Ooma does offer end-to-end encryption, but only when making calls to other Ooma users. Our own research found that Ooma also doesn’t offer two-factor authentication.

 

Plans & Pricing

The image below provides an outline of available Ooma Office pricing, and our Ooma Review offers more insight.

ooma office pricing

 

User Experience

The below table provides a summary of the typical Ooma user experience. 

What Users Like What Users Dislike
Auto-configuration technology works with your existing phone hardware, only takes a few minutes to set up and configure Issues with dropped calls and low overall call quality, plus no information on guaranteed uptime provided on the Ooma website
Solid, easy-to-use mobile app ideal for on-the-go team communication A lack of more advanced features, especially third-party integrations

 

Avaya: For In-Office Small Businesses Prioritizing Quality Hardware

Avaya Cloud Office is a small business phone system with features like: 

  • Unlimited calling and SMS in the US
  • Automatic Speech Recognition
  • Text-to-speech in 20 languages
  • Voice Effects to adjust tone, pitch, etc.
  • Call logs
  • Visual voicemail and voicemail-to-email
  • Call forwarding
  • HD Voice
  • 200+ third-party integrations
  • File sharing and editing
  • Video calling

 

Top Features

Given that Avaya has long been an established telecommunications hardware provider, it’s no surprise that it offers some of the highest quality equipment in the industry.

Avaya hardware

 

Users can connect smart devices like Alexa to their business phone systems, and can choose from three deployment options for Avaya Rooms, the provider’s physical office equipment. Avaya Rooms offers an HD CU-360 camera that shows remote and live participants on desktop and mobile devices.

Avaya Spaces Dashboard

 

Avaya Spaces is another standout feature, functioning as a virtual team communication and collaboration space that unites voice, video, chat, task management, and more into one platform.

 

Network Reliability And Customer Support 

Avaya is HIPAA, GDPR, and PCI compliant, and has SOC 2 Type 2, ISO 27001, and HIGHTRUST security certifications. It offers a 99.9% guaranteed uptime.

Customer support teams are top-notch, solving 84% of live chat support requests in under an hour, and resolving 91% of outages in under 2 hours. Their Expert Systems automatically resolve issues before they impact service, handling 96% of minor problems without needing human intervention. Phone, email, video and 24/7 live chat support are available for all customers.

 

Plans & Pricing

The image below outlines available Avaya pricing, and more information on Avaya Pricing is available in our service provider overview.

Avaya Pricing

 

User Experience

The table below outlines the typical Avaya user experience. 

What Users Like What Users Dislike
Unlimited audio conferencing calling Analytics aren’t as detailed as competitor platforms
Scalable for up to 250,000 users Users constantly complain many inbound calls don’t show up on desktop and mobile devices, leading to numerous missed calls

 

Grasshopper: The Best Business Phone For Solopreneurs and Micro-Businesses

Grasshopper is a no-frills business phone system provider that offers limited features for a fair price. Toll-free and local numbers are available, and unlimited PBX calling within the US and Canada is included with every plan.

Grasshopper is the best fit for new businesses, solopreneurs, or micro businesses of 5 or fewer employees that really just need a business phone number for added privacy and credibility.

Its features include: 

  • Voicemail and transcription
  • Toll-free, local, and vanity phone numbers
  • Unlimited extensions per user, up to 5 phone numbers/user
  • Call forwarding, call routing, call transfer
  • SMS texting and online faxing
  • Call logs

 

Top Features

Grasshopper’s Instant Response feature helps capture leads by automatically sending a text message to missed calls from unrecognized phone numbers. These responses let the caller know their message has been received, and can include a link to let customers schedule their preferred callback time.

Grasshopper Dashboard

 

The Ruby receptionist add-on gives Grasshopper users access to live virtual receptionist services, meaning customers will speak with a “real person,” not an IVR menu, if team members miss a call. For those interested in auto attendant features, Grasshopper offers a Professional Voice Studio for outsourced, high-quality call menu greetings and voice prompts.

Grasshopper mobile access

 

Its visual voicemail feature includes both transcriptions and MP3 recordings of voicemail messages, which can be forwarded to up to 15 email recipients.

 

Network Reliability And Customer Support

Grasshopper offers 24/7 phone, email, social media, and website chat support, along with how-to tutorials and troubleshooting tips within their online knowledge base. Though the features are basic, Grasshopper is known for fast, high-quality support.

However, Grasshopper is not HIPAA compliant, and their website contains alarmingly little information regarding guaranteed uptimes, security certifications, and overall network monitoring strategies.

 

Plans & Pricing

Grasshopper follows a different pricing model than the other providers in this piece, as pricing is structured according to the desired number of users, not specific features. This means all plans come with the same features, and paid add-ons are available regardless of the desired number of extensions or lines.

A free 7-day trial is available. Though the image below shows basic Grasshopper plans, our piece on Grasshopper Pricing offers more information about associated features and costs.

Grasshopper Pricing

 

User Experience

The table below outlines the average Grasshopper user experience.

What Users Like What Users Dislike
Easy-to-use, quick set-up process, little to no learning curve Limited features–especially a lack of call recording–and few third-party integrations means many new or micro-businesses eventually outgrow Grasshopper
Per-user pricing structure means all users have access to the same features $25.00 activation fee, $75.00 auto attendant add-on fee

 

How Does a Business Phone System Work?

Business phone systems work by using VoIP technology to manage calls virtually, over the Internet, instead of via the PSTN’s copper wiring.

How Does VoIP Phone Work

As shown in the image above, business phone systems break up the outbound speaker’s audio into smaller data packets, which then travel to the destination device over the Internet, where they are reassembled into audio.

Because VoIP calling is powered by the Internet, users can make/receive business calls anywhere with a stable broadband Internet connection–and on any device that connects to the Internet.

 

Business Phone System Features

Though there are well over 50 standard VoIP phone system features, we’ve highlighted the most important features for small businesses below.

 

Business Phone Numbers 

In addition to allowing small businesses to port in their existing business telephone numbers, virtual phone systems offer four types of VoIP numbers:

  • Local Numbers give businesses a local presence regardless of where their office is physically located. These numbers use area codes tied to a specific city or county, as customers are more likely to work with local small businesses. Local numbers are especially popular with fully remote companies and SMBs with multiple locations across several cities/states.
  • International Numbers have number prefixes specific to a country, so businesses can project a global presence or gain the trust of international clientele.
  • Toll-Free Numbers, with number prefixes like 1800, 888, 877, etc., ensure that the business itself, not the customer calling the business, is charged for the cost of the phone call.
  • Vanity Numbers are toll-free numbers that contain words/phrases relevant to the business, making it easier for customers to remember. Common examples are (1)800-FLOWERS, 888-BESTBUY, or (1)877-KARS4KIDS.

 

Call Routing

Call Routing automatically distributes calls to specific agents, ring groups, departments, or voicemail boxes according to preset rules and/or responses to IVR prompts–without putting the customer on hold or forcing them to hang up and call another number.

Call Routing

Popular call routing strategies include list-based routing, skills-based routing, VIP/relationship-based routing, time-based routing, most idle routing, and round robin routing.

 

Call Forwarding

Call Forwarding automatically sends (forwards) unanswered calls to additional business telephone numbers instead of sending these calls to voicemail, ending the calls, or making customers call additional phone numbers themselves.

Call forwarding

For example, if you miss a call at your desk phone, call forwarding will instantly forward the call to your mobile phone. If you don’t answer on your cell, the call is forwarded to your home phone, then to your voicemail box, to another agent, or back to the main menu. Call forwarding settings can be customized and edited at any time, and admins can set the number of rings before the call is forwarded to the next number on the list.

 

Omnichannel Communication

Omnichannel customer service and communication combines all your business communication channels (video, calling, SMS, etc.) into one unified, automatically-synced interface.

What is Omnichannel Customer Service

 

This means customers and employees can easily switch between channels during a single conversation or support interaction without missing a beat. For example, a customer could start a customer support interaction with a phone call, and end that same interaction on a video conference with screen sharing for better assistance.

Omnichannel communication not only cuts down on app switching, it also lets customers choose their preferred way to connect with your company. Plus, it makes it easy for multiple reps to work on the same support ticket without the customer needing to repeat themselves each time they speak to a different agent.

 

Visual Voicemail

Visual Voicemail automatically transcribes voicemail messages, then sends these transcriptions to agents as emails, text messages, or displays the text directly in the softphone interface. 

This way, agents don’t lose time listening to longer messages, can better prioritize callbacks, or send reply texts to callers they’ve missed with relevant information.

 

Automated Callbacks

Automated Callbacks (also called Customer Callbacks) let customers select their preferred date and time to receive a callback from a business, allowing them to avoid waiting on hold for extended periods of time or having to call back multiple times until they reach an agent.

Once the customer schedules their callback, the call is automatically placed in a relevant agent’s call queue, speeding up the resolution process and keeping customer satisfaction rates high by reducing hold times.

 

Third-Party Integrations

Third-party integrations allow small businesses to connect existing software and other applications they’re currently using to their business phone system, eliminating the need to switch between windows to access multiple tools.

Integrations make it easy for teams to access additional features that may not be offered by the VoIP provider, while APIs let IT teams customize their own features and apps to integrate with their phone system.

Common third-party integrations include marketing tools like MailChimp, chat apps like Slack, project management apps like Asana, CRM software like Salesforce, and industry-specific apps like Canva, Curve Dental, or Shopify.

 

Interactive Voice Response (IVR) 

IVR is an interactive call menu that automatically plays when a customer dials your business phone number, providing prompts and information that allows for a higher level of customer self-service.

IVR Call Flow

Customers can enter in their responses to IVR prompts via dial pad touch tone, or speak their responses into the phone directly. NLP (Natural Language Processing) and editable call flow paths analyze the customer’s response, sending calls to relevant agents, departments, or playing helpful pre-recorded information.

IVR increases first call resolution rates and keeps agents free to assist with higher-level calls or to work on priority projects.

 

Call Recording and Call Monitoring

Call recording records all business calls automatically or on-demand, saving these recordings in a searchable database that lets managers conduct quality assessments, review call histories, and protect themselves in the event of a false accusation by a client. Many recording tools allow agents and admins to pause and restart recordings during conversations, protecting clients’ most sensitive information.

Most call recordings are also transcribed, which allows for faster call reviews and lets managers search for specific words/phrases or review detailed voice analytics.

Call monitoring lets managers listen to agent conversations with clients in real-time, while call whisper lets managers give advice to agents during live conversations (without the caller hearing.) Call barge (call takeover) lets managers immediately take control of any customer-client call that clearly needs a higher-ups intervention.

 

Reporting and Analytics

Small business phone system providers offer customizable and pre-made reporting templates that provide insight into customer and agent behavior, call center and contact center activity, and even AI-powered analysis.

These reports can be generated automatically or manually, and can be shared and exported to other team members.

Common KPIs and metrics to track include:

 

Types of Business Phone Systems

Here, we’ll explain the available types of business phone systems, focusing especially on the differences between premise-based and cloud-based solutions.

 

Premise-Based Phone Systems 

An On-Premise (Premises-Based) business phone system means all necessary telephony equipment and hardware (servers, handsets, wiring, etc.) are physically located on the business or office premises. 

It also means the end user (AKA, your company) is responsible for managing business phone system installation, upgrades, maintenance, and securitynot the phone system provider themselves.

 

Landline Business Phone Systems 

Though standard landline telephones operating via the PSTN are still available as premises-based solutions, most companies have made the switch to on-premise PBX systems.

Why?

Because not only do old-school landlines and cordless phones lack the features of cloud-based VoIP phone systems, they’re also incredibly expensive to operate. Above all, standard phone systems are well on their way to becoming entirely obsolete–with most experts estimating they’ll be mostly gone by 2025.

 

Traditional PBX Systems 

Like landlines, Traditional PBX (Private Branch Exchange) also uses the PSTN to manage inbound and outbound business phone calls.

However, an on-premise PBX essentially provides your business with its own private telephone data network, meaning you’ll cut down on the costs of additional phone lines.

Although this offers your company greater control, note that a standard PBX phone system is fixed to a single location (within your office building, where the hardware is located.

It’s also accessible only to connected devices, like desk phones–so agents can only use their business telephones when they’re physically at the office. Finally, the sheer expense of an on-premise PBX system, which can easily run up to $20,000 to install, means it’s just not an option for small businesses.

 

Cloud-Based Phone Systems 

A cloud-based phone system uses Internet-powered VoIP (Voice over Internet Protocol) to offer provider-managed business telephone communications hosted offsite, within the virtual cloud.

Cloud phone systems are much more affordable than on-premise systems, as they can work with existing equipment, don’t require in-house IT teams since the provider manages maintenance and upgrades, and offer scalable month-to-month bundled payment plans. Most companies switching from landlines to virtual phone systems save at least 50% on business communications costs.

Our comparison of VoIP vs landlines offers additional information.

 

VoIP  

Because VoIP (sometimes called virtual telephony or IP telephony) isn’t connected to the wired PSTN, your business phone system is accessible anywhere, and on any device, with an Internet connection. This means agents can take calls on their desktop computers via a softphone interface, on mobile phones via iOS or Android mobile apps, or on tablets.

Cloud phone systems offer flexibility, scalability, and the incalculable benefit of numerous advanced VoIP service features–all for a fraction of the cost of premises-based systems.

For further explanation on the differences between cloud-based and premise-based phone systems, check out our comparison of VoIP vs PBX.

 

Cloud PBX Systems

Cloud PBX (Hosted PBX or Virtual PBX) phone systems also provide businesses with their own private phone system. However, unlike on-premise PBX, cloud PBX is hosted in an offsite data center and managed by the third-party PBX provider, not the end user.

This means businesses avoid the expenses of purchasing hardware, in-house IT teams, and maintenance. Hosted PBX makes it much easier to scale phone lines up or down, as it doesn’t require the installation of physical wiring and cabling.

Best of all, Cloud PBX systems give users access to the mobility and advanced features of VoIP business phone systems. Our overview of Virtual PBX phone systems provides additional details.

 

SIP Trunking

SIP Trunking is a gateway that establishes a connection between your existing premise-based PBX system and VoIP virtual telephony, allowing you to simultaneously keep your on-site PBX equipment and get the benefits of VoIP.

The below diagram offers a visual explanation of the differences between hosted PBX and SIP Trunking:

Yes, SIP Trunk users are still responsible for purchasing and maintaining their own PBX equipment. However, SIP Trunking creates a virtual connection to the PSTN that makes adding virtually unlimited phone lines and communication channels much easier–while combining all telephony solutions in one structure.

Our guide to Hosted PBX vs SIP Trunking further explains the differences between these two types of cloud-based business phone systems.

 

How to Choose a Business Phone System

Finding the right small business phone system shouldn’t just be about pricing and available features.

Take into consideration smaller details like contract lengths, guaranteed uptime, support channels and availability, and overall ease of use. Think about how long it will take your team to adapt to and learn to use the potential provider, and whether or not on-demand video or in-person user training is offered. Remember to ensure that the platform is compatible with any hardware/equipment you plan to continue to use, as well as compatibility with your preferred third-party software.

Above all, do your research and don’t rush into a decision. Once you’ve narrowed down your list, check out our head-to-head comparisons (like this one of Avaya vs RingCentral) and rely on our interactive business VoIP review page for more information.

 

Small Business Phone Systems FAQs

Below, we’ve answered some of the top business phone system FAQs.

A business phone system works by facilitating VoIP communication, which breaks up voice audio into smaller data packets that travel to their destination via the Internet, where they then reassemble. VoIP phone systems make it easy to add new phone numbers and extensions, as no physical copper wiring is required. VoIP telephony means scalable, mobile calling anywhere with Internet access.
Most business phone systems require little installation and work with your existing hardware (desktop computers, smartphones, etc.) You’ll need a strong Internet connection, a router, a modem, and a few other key pieces of VoIP equipment. The setup process of the system itself usually entails developing call flow paths, recording IVR systems, assigning agents to extensions and call groups, and more.

Top business phone system benefits include:

  • Cost savings of between 50-70% compared to landline phone systems
  • Additional communication channels
  • Advanced VoIP features like visual voicemail, IVR, and automated callbacks
  • More detailed real-time and historical analytics
  • Improved internal collaboration
  • Higher first call resolution rates
The two main types of business phone systems are on-premise and cloud-based, with the latter being the most popular. The most common cloud phone types are: - VoIP - SIP Trunking - Hosted PBX