Discount Parachutes

Choosing A Hosted VoIP Provider Based On Price Is A Mistake

Choosing a Business VoIP Provider based on price is like a skydiver purchasing the least expensive parachute. It obviously does not make much sense for the skydiver, especially if he/she wants to live to jump another day. It also does not help increase repeat business for the parachute manufacturer (dead skydivers don’t buy parachutes).

In order to remain competitive, businesses must purchase goods and services at the lowest price possible that will allow them to maintain a certain level of quality. Some decisions require very little analysis because the product or service being purchased is a commodity and the risk of an incorrect decision is easily corrected. The decision to purchase office supplies is a good example.

Other purchase decisions require more analysis because the consequences of making an incorrect decision can have severe or even deadly consequences. Life and death decisions require a thorough analysis with the most weight given to factors that affect survival. Price is not usually high on the list in life and death decisions.

Sky divers do not purchase parachutes solely based on price unless the choice is between 2 identical parachutes. If the choice is between 2 similar, but not identical parachutes, a rational skydiver would analyze the characteristics of each parachute, including the reputation of the manufacturer and choose the parachute that would give them the greatest chance of using the parachute another day. Price would not be one of the primary decision factors.

Savings Can Reduce Profits

Ask yourself the following questions;

• How much can I actually save and what could I lose?
• You cannot save more than 100% of the entire monthly bill on any service. This is obvious.
• The real question you should be asking is;

The Hidden Cost Of Savings?

For example, if your current phone expense is $1,000.00 a month, the most you could possibly save is $1,000.00. Assuming that you were able to get your phone service for free, which is unlikely. That is it, you can’t save any more than 100%.

Reducing expenses is important, but the reduction should not have a negative impact on your company. Choosing a service that is mission critical to your company, like your Business VoIP phone service, solely based on price, can end up costing more, and sometimes much more, than what you were hoping to save.

When evaluating 2 competing products or services, a rational business person would choose the product or service that produces the highest returns. For example, if Business VoIP Provider #1 cost $100 a month less than Business VoIP Provider #2, your first instinct is to choose the cheaper provider, however, there can be significant differences between the two Provider’s VoIP Service VoIP quality, available features, and with the customer service and support provided which you won’t realize until long after you have signed on the dotted line.

The Wrong Phone System Can Have A Financial Imapct

There are many ways a phone system can have a financial impact on a company.

Here are a few;

System Down

What would happen to your business if your phone system suddenly stopped working and it took 1 week to fix? Obviously, this would have a serious financial impact. The negative impact on your company’s reputation could be fatal.

Intermittent Call Quality Problems

Scenario #1: A salesperson could be speaking with a potential customer about a big deal and your phone system suddenly “drops the call”.
Scenario #2 One of your larger customers is calling about about a problem they are having and suddenly they are unable to understand what your customer support person is saying. That can be good and could be the straw that breaks the camel’s back and you lose a good customer.

Inadequate Customer Service

Your business operates 24/7 and you experience a problem with your phone service, can you afford to wait until the morning to get this problem fixed?
Generally, when you pay less, you get less. Any savings you may realize in the short term will pale in significance to the loss of revenue from a decline in productivity and customer satisfaction from a poorly performing phone system.

In order to succeed in the long run, a company must increase revenue and the phone system must be able to support your business objectives.

A small saving can easily turn into a huge loss and that is why it is so important to carefully evaluate the non-price differences.

8 Key Business VoIP Provider Selection Factors

Financial Stability of Business VoIP Provider
This is difficult to determine because most providers are privately held.

Experience

How much experience does the Business VoIP Provider have delivering VoIP? How long have they been in the business? What types of customers use their service. It is a good idea to get references.

Customer Support

Business VoIP phone systems are complicated. You will need to work closely with the Business VoIP Service Provider to implement the features your business needs. What good are great features if you can’t use them.

What VoIP platform are they using?

Is its proprietary, will it scale? How do you get bugs fixed? How do you migrate to another carrier? What happens if the programer dies or leaves the company?

Redundant Facilities?

Are the VoIP Providers facilities redundant? Do they have multiple data centers that are geographically diverse? How does it fail-over? One of the key selling points of Hosted PBX is that it is good for business continuity – but only if the provider has a DR/BC plan as well.

CRM Integration

Does the provider’s platform easily integrate with the popular CRM software platforms like Salesforce.com, Outlook, Act etc.

System Features

Does Business VoIP Provider offer the features I need that will allow my business to execute its strategic plans.

Customization

Can the system be easily customized?

Conclusion

Price, while important, should not be the primary consideration when choosing your next Business VoIP Provider. This choice is one of those decisions that affect every aspect of your organization.

The phone is one of the primary ways your customers and potential customers interact with your company, it is also the primary way your employees communicate with each other. Saving a few dollars on such an important part of your company is probably not a good idea.