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How Much Does a Phone System Cost for a Small Business?

This article was updated on April 9, 2024

Small-business phone systems are surprisingly cost-effective nowadays — especially if you go with Voice over Internet Protocol (VoIP) technology. This is encouraging news for small business owners who rely on communication to turn a profit. While you rejoice in the extra wiggle room in your budget, let’s break down how phone-system pricing works.

Illustration of a hand holding an office phone. Above the hand is a piggy bank with a money symbol, representing cost savings. Floating around the phone are cloud icons.

What Drives Phone System Costs for a Small Business?

The cost of a small-business phone system will vary depending on numerous factors. A cloud-based VoIP system, for example, can cost around $15 to $40 per user, per month. Some of the factors that influence price include:

  • Number of Users — Most pricing plans will have a per-user cost. You need to decide if every employee needs a phone line or if you can get by with one line for multiple employees. Consider how your customers communicate with your business, whom they need to reach, and the frequency of calls. Some providers also offer volume discounts, meaning the more users you add, the lower the price per user will be.

  • Phone Model — If you need to purchase desk phones for your new system, you’ll find a wide range of prices as you shop around. One IP desk phone can cost anywhere from $50 to $300, and you may have to pay an additional labor charge to program it. However, the beauty of VoIP technology is that it doesn’t require a traditional phone. Most VoIP providers have an app you can download directly to any device, like a smartphone, laptop, or tablet. So instead of investing in expensive hardware, you can have your employees use the devices they already possess to make calls. 

  • Training Costs — A new phone system will require some form of staff education — an often overlooked factor when budgeting for a new phone system. The cost of training will vary depending on the number of employees and locations. To help you save money on this expense, Vonage makes it easy for new business phone customers, offering a helpful library of tutorials and live training sessions.

  • Desired Features — Do you just need a few phone lines and a way to capture voicemails? Or are you looking for a system that’s a bit more feature-rich? More features will mean a higher cost, but the price tag is usually worth it for businesses with significant communication needs. For example, Vonage’s Advanced pricing tier offers 40+ voice and unified communications features — auto attendant, visual voicemail, on-demand call recording, call groups, spam shielding, and much more.

Now, if you’re not so sure about using an internet phone, you may be wondering …

How Much Does an Office Landline Cost?

Basic landline services without internet (aka plain old telephone services, or POTS) generally cost around $15 to $40 per month, per line. You’ll also have to pay for POTS phones, telephone line installation services, and maintenance fees — all of which can add up fairly quickly.

If you’re determined to go this route, you should know that landline business phone systems may not be an option in the near future. As much of the world switches to internet-based phones, many providers are halting landline services altogether. This is largely due to the higher costs of maintaining copper wire infrastructure for landlines versus cloud- and internet-based phone services.

A recent story in the Times of San Diego points to this inevitability. It shares the story of Joyce, a native San Diegan living in a condo. She received a letter stating her phone provider would no longer offer copper-wire landline services to her building at the end of the month. The article mentions Joyce’s story is becoming more common, because telecom giants see “the writing is on the wall; landlines are a dying breed, and it’s time to move on.”

So while you can pay for this “dying breed” of communication, there’s a good chance that even the cheapest landline phone service won’t be around much longer. This means you’ll likely have to pay for an internet-based phone system anyway when that time comes.

How Do I Setup a VoIP Phone System for a Small Business?

Setting up a VoIP phone system for your business is easy with Vonage — here are the general steps to follow:

  1. Pick a pricing plan.

  2. Select the number of users.

  3. Check out through our handy ecommerce system.

  4. Create your online account.

  5. Choose which numbers to use on your account, and purchase an extension for each of your users. You may be able to use an existing phone number based on your current carrier, or you can choose an available number from Vonage’s inventory.

  6. Set up the phone hardware you want used and have employees download the Vonage app onto their devices.

  7. Train your employees on how to use the new phone system.

Vonage is trusted by large brands like Allstate, Domino’s, DHL, The Princeton Review, and many others — but we understand the unique needs of small businesses as well. Let us help your small business communicate more efficiently and delight customers, prospects, and staff. Get started today!


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