Tax & admin · 14 December 2019

Start saving money on your telecoms

Telecoms save money

Saving money on your business telecoms, broadband and mobile is always a good idea. However, unlike insurance and other costs, many businesses fail to review their telecoms as they’re a feature that’s easily forgotten about.  

Many people discredit the number of costs that could actually be saved, with the average business not reviewing its telecoms for five years. Recently released data from Onecom shows that SMEs are spending, on average, £2,052 per year on telecoms.

Is that figure worth doing something about?

How do you save money on your telecoms?

1. Number of lines

If you have an ISDN-based phone system, how many lines are you paying for?

If your business has changed you may be paying for lines you are no longer using. If you are still in contract, you may not be able to change things, but if you are past your minimum term, you’ll be able to.

2. Call Patterns

Do you make lots of very short calls or more long calls? Fixed-line call tariffs are, generally, either cost per call- or cost per time-based. If you make lots of calls and pay per call, you are almost certainly paying much more than you should and would be better off with a cost per second tariff.

3. Don’t let your contract switch to standard terms

Many telecoms contracts are for an initial term, perhaps two years.

After this, the terms, and prices can change for the worse. Review your options before the contract’s initial term finishes. Do this early enough so that, if necessary, you can give notice to your current telecoms supplier. Many companies try to add long notice periods so that you are tied in for the long term.

4. Switch to VoIP

Telecom save money
Switch it up: moving to VoIP can lower call costs.

Openreach aims to stop all ISDN-based services by 2025, so you will have to switch fairly soon.

However, the benefits of VoIP mean you are highly likely to save money by switching sooner rather than later:

  • Lower call costs
  • Ability to change line count, up and down, as needed
  • Making maximum use of your internet connection will also deliver economies of scale

Still paying for your handset?

Once you reach the minimum term on your mobile contract, you have paid off the hardware part of the monthly cost.

If you don’t yet need to upgrade the hardware, you should talk to your mobile operator about paying for calls, texts and data only.

Better deals CAN be found…

The mobile operators are not always the best people to get your phones from, particularly for bulk purchases.

Better deals can, almost always, be found elsewhere. Even if you don’t want to add this to your Capex (capital expenditure) spend, you can always ask the mobile operator for the hardware fund. You can then spend that elsewhere, and pay it back to the operator on a monthly basis.

Do you need unlimited calls?

Many businesses take out unlimited call contracts for business mobiles in case people make enormous numbers of calls. It’s like an All You Can Eat deal at your local restaurant; they rely on the fact that you will eat far less than you expect. It’s the same for the mobile operators so you may not be making the savings you expect with unlimited calls.

Don’t ‘bundle’ copper

Depending on what internet connectivity is available, many companies end up with very strange connections. Bundles of copper-based ADSL lines will deliver the bandwidth your business needs but will rarely have the support you need and the contention ratios you want. Avoid these sorts of ‘make-up’ bundles as a way of creating what you need.

Consider the airwaves

If you are in an area with poor internet connections, look at alternatives that are air-based. Line of site, satellite and 4/5G are all options to consider. Some may be short terms options until a bigger line is installed. Others may only be suitable for smaller businesses – but don’t automatically take the Openreach controlled option. The alternatives are often just as suitable, if not more so, and better value.

Save through productivity

Most of what has been discussed above is based on the cost of the telecoms connections. It’s also worth looking at productivity costs. Saving money on an internet connection by installing a slower connection may save a few quid per month, but if your staff cannot work effectively, you’ll lose money on productivity. Cheaper can prove to be a false economy.

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Gary Young is the director of independent telecoms brokerage Equinox. Gary works with companies, charities and other organisations to help them choose the right telecoms packages for their needs and thereby reduce their costs. He is particularly knowledgeable on the integration of IT and telecoms in business. 

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