The digital upgrade

The complete guide to small business phone systems

Posted by Casey Solomon

An effective telephone system remains an essential part of any small business communication solution. According to Google, 60 per cent of consumers prefer to contact small companies by phone, even if they've found them online.
Therefore, your phone system must be able to provide a high-quality, professional service at all times.

What's more, many small enterprises will need to review their phone services in the coming years as the underlying infrastructure supporting them changes. After 2025, traditional landlines won't be an option anymore, so if you're one of the estimated two million UK businesses still using these legacy networks, you'll need to investigate other options.

Therefore, there's never been a better time to seek out a better small business telephone system that can help lower the cost of calls, improve your efficiency and deliver a better connectivity experience for both employees and customers.

So what do you need to know when looking for a new small business phone system to ensure you're getting the best solution for your firm?

What is a small business phone system?

Whether you're a growing business, a startup, a sole trader or freelancer, being contactable by phone is essential. Many businesses - especially those that are just starting out - may think they can get by with a consumer-grade solution or a standard mobile tariff. However, there are many reasons why it's not a good idea to rely on these options to represent your business.

A dedicated small business telephone system will provide you with many more options to promote and grow your business, from the ability to choose your own geographic or non-geographic number to sophisticated call handling features to give your customer service a boost.

What types of business phone line options are available?

The first step should be to understand the different options available to you for telephony services. There are several roads you can go down, so it's important to understand what these are before you commit to a contract.  

Finding a small business phone system can be a bit confusing, with jargon like 'PBX system' and 'ISDN' seeming alien to many non tech-savvy small business owners. However, by searching out options aimed specifically at firmslike yours, you can take a lot of complexity out of the process.

The most common option for small firms is Voice over Internet Protocol (VoIP). These lines use internet connectivity to make and receive voice calls. They require a compatible device, such as a computer or a VoIP-enabled handset and offer a highly-reliable, flexible system for firms of all sizes.

VoIP options usually fall into one of two categories. These are:

  • On-premises VoIP - This requires you to have all the equipment needed for your telephone system on-site. While this offers a high level of control over your phone system, it does need a big upfront investment, and is therefore more suitable for larger businesses.
  • Hosted VoIP - Sometimes known as cloud telephony, hosted VoIP sees your provider take care of all the hardware and infrastructure, meaning all you need is an internet connection. It's cheap and easy to get started, so is the most popular choice for small firms.

There are other options for business telephony, such as SIP trunking and IP PBX solutions, but these are typically geared towards larger businesses that need to run multiple lines, and are often both too technically complex and too expensive to be practical for small companies.

But what about landlines? These are also not recommended for any business today, as their lifespan is now very limited. While businesses in some locations may still be able to buy these options, the phase-out of this technology has already begun. Many phone exchanges have already stopped selling new copper lines, and this will be extended to the entire country by the end of 2023, with networks set to be switched off completely by 2025.

When does a small business need a cloud phone system?

For many small firms and entrepreneurs, a hosted VoIP system is likely to be the most compelling option. This combines low costs and ease-of-use with the option to add powerful extra features that can scale up with your business. Signs you may benefit from a cloud-based phone service include:

  • You may need to add extra lines in the future
  • You need to keep costs low
  • You must be contactable in several locations or when on the move
  • You need to add extra services such as advanced call handling or video

How do business internet phone systems work?

An IP phone system works by breaking up your call into digital packets, which are then sent over an internet connection in much the same way as other data. However, these packets are given top priority ahead of other network traffic to ensure you don't suffer from any issues such as latency or drops in quality. 

Typically, an internet phone system will consist of a handset at your end and a cloud server managed by your provider, through which every phone call you make or receive is routed. All data is held securely, while you can usually make any changes to your system via a simple-to-use online dashboard, which can let you set up call flows, call forwarding, voicemail messages and other essential customer service features.

What is softphone networking?

Softphone networking enables you to make and receive calls from anywhere, on any device, without the need for a dedicated handset. All you require to make this a reality is an internet-connected device and a microphone such as a headset. 

This can allow you to access your phone system on a desktop or laptop PC via a web browser, for example, which can be particularly useful if you need to connect from both home and the office. It can also be accessed via a mobile app, enabling you to make calls using your mobile data without actually using your personal mobile number or tariff, much like with consumer services such as WhatsApp.

Find out more about how bOnline's VoIP phone systems can benefit small businesses.

Working remotely? Use any device anywhere!


  • Make business calls from your computer
  • Available for Windows and macOS
  • Sync contacts from your mobile
  • One-click call audio & video meetings


  • Superior call quality & HD voice
  • Available on iOS & Android devices
  • Powerful call controls in your hand
  • Join meetings from anywhere
  • Never miss a call

How do you set up a small business phone system?

Ease of setup should be a key consideration when selecting a small business phone system. While some on-premises solutions will require you to have infrastructure installed on site, which may add to the time and cost of getting started, cloud-based hosted VoIP services can often be set up quickly with no technical know-how.

Can I install my small business phone system myself?

In most cases, small business owners should find it very easy to set up their own hosted VoIP phone system. In just a few steps, you can quickly get up and running without the need for an engineer visit, installation or expensive hardware.

Provided you have the right equipment - which may be nothing more than an internet-connected desktop or laptop PC - you simply select the number you want, choose a tariff with your new provider, and they will do all the work for you. The process can be completed in as little as two minutes and all you have to do is connect your new device to the internet - either by cable or Wi-Fi - and you're all set.

When transferring an existing phone number from the traditional PSTN landline network, allow for ten days - though it may often be completed sooner. Transferring a number is important for continuity and future-proofing businesses.

What equipment is needed for a small business phone system?

Small businesses that take advantage of softphone systems will need very little equipment in order to get up and running. In fact, as long as you have an internet connection, a laptop or desktop PC and an attached microphone and speaker, you've got a working phone system. If you have decent Wi-Fi, you won't even need to plug in a cable and be tethered to a desk. 

For firms that want to take full advantage of a hosted voice system while retaining a more familiar feel for your users, however, it may be useful to maintain traditional handsets. To ensure they work with hosted voice solutions, you'll need hardware that's compatible with VoIP services.

If you purchased your existing desk phone handsets in the last few years, there's a good chance they'll already have this capability, in which case you can simply plug them in and start making calls. However, it's vital you check this before you sign up for a business VoIP system in order to avoid any unpleasant surprises. If your legacy handsets do need to be replaced, this can add time and expense to your migration to cloud voice, so check with your provider for discounts or packages that include phone hardware.

Other than this, the only thing you'll need to get up and running with a VoIP phone system is a decent business broadband connection. As this technology uses internet data connectivity to transmit voice, you'll need to ensure your connection meets minimum speed requirements in order to enjoy a quality service. 

For a single line, this should be well within reach for the vast majority of businesses. Most VoIP providers recommend a speed of around 10Mbps for both upload and download to be able to make multiple calls at the same time, though higher speeds may be necessary for services such as video.

As the average broadband speed in the UK is around 50Mbps as of 2021, this should be more than adequate to manage a quality VoIP phone system. However, more rural and remote businesses should check with their provider beforehand to ensure they meet these requirements.

Do small business phone systems work well for remote employees?

As noted above, a hosted VoIP phone system is ideal for firms that have remote employees, whether they are connecting from home or need to be contactable while out working off-site. This is because, thanks to softphone services and extra features such as call forwarding, it's easy for users to make and receive calls wherever they are, no matter what device they're using.

This is a feature that is likely to be increasingly important for many small businesses in the coming years, as the transition to a more flexible, hybrid way of working looks set to become a permanent fixture in the post-pandemic norm. 

Figures from the Office for National Statistics show that 84 per cent of workers who had experienced home working because of Covid-19 said they planned to carry out a mix of working at home and in the office in the future, with most people aiming to spend at least half of their time at home. 

It's therefore essential that businesses have the right technology in place to support this, both to attract and retain talented workers and to ensure that productivity remains high.

Can small firms keep their existing business phone number?

Another advantage of a VoIP phone system is the ability to choose your own numbers. If you already have an existing phone service with numbers that your customers are familiar with and are used on your signage and advertising, it is usually a very simple process to transfer these phone numbers to a digital phone number for use with a hosted voice system.

All you have to do is let your new provider know you wish to keep your number and all the work should be taken care of. There may be a small fee involved in this and it will typically take between ten and 20 days to complete the process, but this ensures you can maintain business continuity and keep serving existing customers and partners without interruption.

If, however, you want to expand your range of numbers, select more memorable contact information or choose a particular local or national number, this is also an option when selecting a VoIP telephone system. 

For instance, you may want to use a particular area code to indicate a local presence for a certain location, or use a more metropolitan number such as an 020 London prefix. Whatever you want, a good small business VoIP provider can help you add these numbers in a matter of minutes. 

Find out what VoIP options bOnline can offer to small businesses that can get them up and running quickly and cheaply.


Choose your number to get started

What to look for in a small business phone system

Whether you're looking to grow your business, reduce costs or simply get ahead of the curve in preparation for the landline switch-off in 2025, you'll find there are a wide range of phone options available, not only in terms of technology but also the features that are on offer and the type of provider you can sign up with.

Choosing the right partner for your small business telephone system is just as important as selecting the most suitable technical solutions. Get this wrong and you could find yourself locked into a lengthy, expensive contract that doesn't meet the needs of your business.

How much does a phone system cost for small businesses?

The good news is that a strong, feature-rich phone service is highly affordable for even the smallest business, and can save you a lot of money when compared to a landline. 

For example, bOnline's VoIP systems start at just £6 per user for an entry-level package, while options with unlimited calls and a wide range of extra features can be secured from £12.95 plus VAT. This compares very favourably to legacy landlines, which may cost firms upwards of £30 a month just for line rental, with extra charges for calls on top of that.

Being able to buy the exact number of lines you use, which can then be scaled up as you grow, also means you aren't wasting money on services you don't need. What's more, VoIP options may be particularly beneficial if you frequently make international calls. 

As IP technology relies on internet connections, there's no difference in cost or quality whether you're connecting with a colleague next door or a supplier on the other side of the world. As a result, small firms could see savings of as much as 80 per cent for some users.

How do you choose the best small business phone system?

Before you make a decision on which offering to go for, there are several key questions you need to answer. By identifying exactly what you need from a phone service early, you can compare small business phone providers to see which best meets your needs.

Some questions you should have in mind as part of this include:

  • Reliability - What guarantees does the provider offer for uptime, and what contingencies are in place should disruption occur?
  • Usability - How easy is the system to set up and maintain? Will there be a lengthy waiting period or need for an engineer visit?
  • Contract length - How long will you have to sign up for, and what penalties will there be if you want to exit your contract early?

Don't forget to look at resources such as online reviews. What existing users have to say about a provider can give you a great insight into how they work with customers and how suitable they are for businesses like yours.

What features should a small business think about when shopping for a phone system?

High-quality calling is only a small part of what an effective hosted VoIP phone system can offer. If you want to provide the best level of customer service, or improve your employees' efficacy and productivity, you should look to take advantage of some of the wide range of additional features that a good phone system can provide. These include:

  • Call handling - This feature covers tools such as call forwarding, call menus (call flows), and call queuing, which help ensure that your employees are always available, no matter where they are and that customers and partners won't end up waiting on hold or being passed around from person to person before they find the answers they're looking for.
  • Customisation tools - The ability to record customised greetings for your phone, set up your own business hours, preset call flows and add tools like voicemail to email ensure you provide a professional experience to users.
  • Integrations - Being able to add services such as video calling and connectivity with tools such as Salesforce, Microsoft Office and other essential business functionality helps you build a complete unified communication service. This ensures employees always have the information they need at their fingertips to provide the highest level of customer service.
  • Reporting - Tools such as call reporting and recording tools help business owners gain a complete picture of what's going on in their business. This can include monitoring and recording calls for proof of what was discussed, or analysing traffic patterns to gain more insights into how your business is doing.

How do small business phone systems differ from each other?

There are many types of small business phone system, which may each have their pros and cons. Options include large-scale communications providers, dedicated small business services and all-IP offerings. Some names you may be familiar with include GoTo Connect, Ringcentral and HiHi Connect, but these are just the tip of the iceberg, and many other providers large and small offer very similar services.

For example, some business connectivity platforms, such as Microsoft Teams, offer traditional phone services as part of their offerings. These can offer great integration with other services to help build a unified communication solution. However, these may end up being more complex and expensive than a dedicated cloud VoIP system that has been designed from the ground up with small business owners in mind.

Cost and complexity aren't the only factors that differentiate providers. Other considerations include the level of service and support you can expect to receive. For instance, while you could go directly to one of the UK's larger business phone providers such as BT for your comms needs, you may find this offers a less satisfying user experience.

Firms that primarily cater to large enterprises may not be able to give you the personal level of support you need as a small business owner, and could treat you as little more than a minor entry on their balance sheet. 

Therefore, entrepreneurs, startups and growing enterprises may find it beneficial to opt for a provider that has more experience meeting the needs of small firms. This can ensure they get a more personal level of service, as well as keeping things simple for small business owners who may not be especially tech-savvy.

Learn more about how an effective hosted VoIP phone system can support growing businesses.