Telephones. We can’t do business without them. But I am going to make a radical suggestion: you are very likely paying far too much for your phone service, and not even getting the telecommunications that your business really needs. At the heart of that statement is the knowledge that the telecommunications industry has changed dramatically over the past decade, and especially in the last three years. Mobile phone networks have become very cost effective and are actually cheaper than fixed lines in many situations. This begs the question, do you really need both a fixed phone line and a mobile phone?
In the residential space, fixed home phone lines are slowly becoming obsolete, especially in urban areas with excellent wireless coverage. In fact, the younger generation get fixed phone lines simply as part of a bundle deal on their internet connection. The Australian Communications and Media Authority (ACMA) shows that one in five consumers have considered dropping their fixed lines to save money.
Business owners have been much slower to follow suit by reducing the number of fixed lines to cut costs. Some of the resistance to mobile phone plans in business has been the ease at which roaming staff can accidentally rack up absurd phone bills, or the huge bills they are paying from their landlines for calls made to mobile phones. But the reality is, these high-cost situations are simply a matter of bad-planning and lack of knowledge about the details of phone plans. With a little bit of education and some policy on phone use, it is possible for a small business to substantially reduce it’s monthly phone bills, while improving client contact, by turning to mobile plans.
Why keep a fixed line?
There are a number of reasons why you, as a small business owner, would keep a fixed line. First is that customers perceive having a landline number as a sign that the business is more established and more professional. When including contact details in printed or digital media, a fixed line is an important confidence fact. Also, by only releasing a fixed line number, you can reinforce the point that your business can only be reached during business hours: publicizing your mobile number means your business is on call 24/7 which is only a good idea if your business provides out of business hours emergency services, but not so great if you want uninterrupted evenings. Of course, you can manage this by switching your mobile phone to voicemail, but simply the fact you have a mobile number published will set a certain expectation among customers. So, if you want privacy after hours, a fixed line will be required.
Also, having a 1800 number, that are only available on fixed lines, can be a good way to attract business, especially if you are in a highly competitive service industry, such as landscaping, mowing, etc.
If you have a larger business, with many incoming calls, you will need to have circular line hunting (also called “round robin” call forwarding). That is, customers call one number and if that is engaged, the call automatically switches to the next available line without delay. Of course, this also means you will have more than one person in the office, working the phones. Currently, round robin call forwarding is only available on fixed line phone plans.
In all of the above scenarios, it is interesting to note that the reason for having a fixed line is to manage incoming calls. This is important to realise, since the bulk of most business phone bills is actually for outgoing calls. Therefore, you may be able to keep your fixed lines for incoming calls, but find cheaper and more flexible ways to manage your outgoing calls.
Another very important reason for keeping a fixed line is for data services: fax and Internet.
Big phone bills... Mobile Phones to the Rescue!
If you look carefully at your monthly phone bill, you will notice that the outgoing costs are the biggest component of your bills. It is also likely that an increasing percentage of those outgoing costs are to client’s mobile phones. So if you want to reduce your overall phone bill, you need to focus on reduce the costs of outgoing calls. There are two ways to do this: reduce the number of calls being made, which is exactly the opposite of what you should be doing as a small business; or dramatically reducing the cost per call.
Unfortunately, with fixed line plans, there is very little ability to reduce the cost of outgoing calls. There seems to be almost no competition in the fixed line space, with all vendors offering very similar outgoing call rates. But it is a different story when it comes to mobile phone plans, where some plans allow unlimited calls to both landlines and mobile phones for set costs. At the high-end, incumbent telcos such as Telstra offer unlimited call mobile phone plans for $129. Nimble competitors such as Kogan Mobile (which is actually reselling Telstra’s own network) offer the unlimited mobile phone plans for as little as $25 a month! If you make more than about 75 outgoing calls a month switching to an unlimited mobile phone plan will almost certainly save you money.
To give you an idea on how much money can be saved, I recently dropped one line in our business that we were using for outgoing calls and replaced it with a mobile phone. It saved us just over $300 a month. But more importantly, because the mobile plan is a fixed price, there are no surprise bills at the end of intense months. I can budget accurately.
Finally, let me state clearly that most ‘small business’ mobile phone plans are dreadful and over-priced. It’s almost like the telecommunications companies know that small business people don’t want to be bothered reading the fine print and therefore these plans, often bundled with fixed line services, screw small business people over with long-term contracts and inflated call rates. There. I said it. (Yes Telstra, I am talking about you!) So if you do plan to investigate the option of switching all your outgoing calls to mobile phones, be sure to look at all the plans on offer and not just take the deal your telco is pushing.
Reducing the number of fixed lines and some easy alternatives.
In addition to rationalising your outgoing calls with fixed price mobile phone plans, I also find that many small businesses pay monthly line rental for fixed line services they rarely use. Take a look at your phone bill and ask yourself, do I really need all these lines? For example, if you currently have separate lines for fax and Internet, then consider combining these services on the same line. Likewise, if you have multiple fixed lines for incoming calls, take a close look at how often both lines are in use. Ask yourself, do you really need that extra line and the extra cost of line hunting, or would a single line with a polite voice mail be nearly as good? Even more interesting, ask yourself if you need to be answering your calls at all... could you get a professional virtual assistant to do that for you? We’ll investigate that option in a later article. You may also consider the use of Voice Over Internet Phone (VoIP) services, which route phone calls over the internet. Again, this is a topic for a future article.
In summary, you should examine your phone bills from the perspective of the value of incoming calls, and the cost of outgoing calls. Seek to maximise the value of incoming lines, while using the great terms and conditions of mobile phone plans to minimize outgoing call costs.