4 Small business phone systems header

For small business owners, one of the most important pieces of equipment or software is your phone system. You’re probably going to be using it every day, and if you choose the right one, it can give you a big competitive advantage.

After all, every business needs, well, business communications. Being accessible to clients, suppliers, and employees is a must-have—and it’s something that small businesses can do just as well, if not better, than large enterprises.

If you’re using the right phone solutions, that is. So, how do you choose the right one? What advantages do different telephone systems and service providers offer?

In this post, we’ll break down what to look for in a small business phone system (while keeping budget considerations in mind), where you might be able to compromise, and what features you probably shouldn’t skimp on.

Keep reading to learn more:

What is a small business phone system, exactly?

First, let’s look at what a small business phone system is.

And no, it’s not just your cell phone.

Technically, a small business phone system is a telephony solution that allows your company to make and receive outbound and inbound business calls (at a very basic level). But beyond that, you’ll also probably need something that lets you transfer and forward calls to, say, your personal cell phone.

If you’re like most small businesses, you’ll probably choose between two main types: a business VoIP (voice over internet protocol) service that uses softphones or IP phones, or a PBX system (private branch exchange) that uses traditional phone lines.

  • VoIP phone system: The more advanced—and hands-of—option. It uses your internet connection for phone calls, you can pay as you go without much (or any) upfront investment, and it’s easy to set up. These usually come with “softphone” apps that you can use on Android or iOS mobile phones (and even other mobile devices like iPads).

    You might also come across phone systems that describe themselves as “unified communications” platforms. This is a newer term, and usually these types of phone systems come with other communications channels too, like SMS and instant messaging.

  • PBX systems: The more investment-heavy option. Typically you need to buy more hardware up front and you’d need to pay an IT person to come in and help you with changes like adding users or updating voicemail settings. (Some PBX systems have evolved and are better about this, but generally PBX systems do require more work.)

👉Dialpad tip: If you have a distributed or remote team, or you need to make lots of international calls because your customer base is in different countries, then a VoIP solution is probably your best choice.

9 features that a small business should think about when shopping for a phone system

1. Call forwarding to your mobile phone

If you’re not always at your desk and usually taking calls from your cell phone, this is one of the top features you’ll need.

In Dialpad, you can add your cell phone number really easily in your Settings in two clicks. Now you can make sure that your calls are automatically forwarded to your cell:

adding a call forwarding number to dialpad

2. Easy call transfer (and call routing)

Again, if you run a small business, you’re probably busy and stretched way too thin. Which means you can’t possibly answer every single call you get.

But what if it’s an important client or prospect? You don’t want to miss those calls. This is where a call transfer or call forwarding option would come in handy, and you can set up your calls to go straight to your office manager, or secretary, or even sales team if you don’t pick up.

With Dialpad, you can choose for calls to be forwarded to up to five numbers (landline phones or mobile)—even if they’re not Dialpad numbers!

Whether it’s your colleague’s cellphone or desk phone, a good phone system can make sure that your small business pretty much never misses a call again.

3. The ability to keep your existing business phone number

Unless you’re starting a brand new business from scratch, you’ll need the ability to port over your existing business number. Why? Because the last thing you want is to make your customers and suppliers update your phone number that they already have saved in their contact list.

With Dialpad, it’s simple to port over your existing numbers to ensure continuity. Less work for your clients because they don’t need to update the number they’ve saved for you, and less work for you because you don’t have to spend time changing the numbers displayed on your website or other portals.

4. Cloud-based capabilities and compatibility with your mobile device

A cloud phone system is essentially a phone system that isn’t tied to one location or office. With a cloud phone system, you can make calls from anywhere, it usually comes with a mobile and desktop app, and any software updates will automatically be installed without IT help.

This “easy to use-ness” in terms of setup and admin is a big advantage of using cloud-based systems because you can easily do things like add a new user or new hire to your phone system—yourself.

For example, here’s how easy it is to manage your the admin side of a phone system in Dialpad when you want to change an employee’s business number, edit extension numbers, and more:

adding a phone number for someone in dialpad

If you want unlimited flexibility and functionality, you’ll definitely want a phone system that’s cloud-based and plays nice with mobile devices and handsets. That’s pretty much a non-negotiable.

👉Dialpad tip: That “anywhere” accessibility could be annoying if you’re relaxing on a beach in the Maldives, so you may want to turn your phone off if you’re taking some well-deserved PTO.

5. Caller ID

This is a basic one to have. Everyone screens incoming calls nowadays—no one wants to pick up a telemarketer’s call.

In Dialpad, for example, you can choose which Caller ID to show when you call someone:

using different caller IDs when calling from Dialpad

Neat, eh?

6. In-call security and encryption

If your calls involve discussion of sensitive data and information, then you’ll want some level of security. Ideally, you want enterprise-grade security levels—always check with your provider to see what their security features are like.

7. Visual voicemail

If you’re a busy person and miss phone calls sometimes or can’t always find time to listen to all your voicemails, you’ll want this.

Visual voicemail is basically a feature that transcribes your voicemails to text, which means you can read them at any time (like during a meeting).

Dialpad’s Voice Intelligence (Vi) technology transcribes not only your calls in real-time (more accurately than Google), but also your voicemails—and even gives you the option of forwarding voicemails too:

forwarding a voicemail in dialpad

8. Call recording

Call recording is a useful feature to have for some small businesses. Not everyone will use this, or use it often, but if you close deals on the phone or do lots of pitches over the phone, having recordings is useful because it allows you to review calls in the future.

Whether you need evidence for important issues discussed on a client call or you want to analyze calls to see how you can improve a pitch in the future, call recordings make all of that easier.

9. SMS (internal and external)

Ah, texting. Everyone does it today, and some people even prefer texting to calling. Can’t blame them—it’s super convenient.

If you work with clients or prospects who also prefer texting (or you yourself would rather text), then look for a phone system that lets you send SMS messages from the app.

For example, did you know that you can use Dialpad’s app to not only make phone and video calls, but also send SMS texts? We actually have a customer that’s a school that uses this feature to text students (because if there’s anyone who loves texting nowadays, it’s Gen Z):

sending an sms text from dialpad

The 10 best small business phone systems on the market

1. Dialpad

dialpad small business phone call and unified communications platform


Dialpad is an AI-powered cloud-based business communications platform that has a built-in phone system. And it's designed for small businesses (and even enterprise-level organizations) that need an easy-to-use, deploy from anywhere phone system.


👉Dialpad tip: See how Coye law firm, a small firm of about 20 staff, uses Dialpad's phone system to work from anywhere (like beautiful France).

Features:

  • Easy administration and scalability: No IT? No problem. Dialpad is easy for admins to set up and manage with minimal help. You can add and set up new phones and users in minutes—without hiring an expensive IT consultant.

  • High call quality: Because of Dialpad's unique split cloud architecture, it ensures a level of call quality from pretty much anywhere in the world

  • Conference calls—with video: High quality audio and video capabilities to enhance all your virtual meetings.

  • SMS and instant messaging: Text people both internally and externally from your Dialpad account. If the person you're texting doesn't have the Dialpad app, no sweat! They'll just receive your message as an SMS.

  • Cloud-based mobility: Stay connected with any device from anywhere. Unlike many other platforms that only let you join calls from a browser, Dialpad is browser-based, meaning you can do anything in a browser—just like you'd do in the app:

    browser based conference calling in dialpad

  • Call waiting

  • Worldwide customer support: 24/7 live chat support and 24/5 phone support—around the world, not just in the US

  • Integrations: Even with the Standard plan, you can integrate Dialpad with Microsoft 365 or Google Calendar, which makes for easier scheduling:

    google calendar dialpad integration

  • Portability: Keep all your original numbers when you move to Dialpad.

  • 100% uptime SLA

  • Awesome hold music options (or go custom):

    choosing on hold music in dialpad app

  • Contact center solutions like IVR, queuing, recording, and analytics.

  • Call transfer: Forward, transfer, or route calls according to your needs.

  • Auto attendant: Dialpad's Virtual Receptionist streams and sorts calls in real time according to your settings.

  • Local numbers: Help build your brand’s profile by assigning local numbers.

  • Voicemail: Audio and visual voicemail options keep you up to date with missed calls

    visual voicemail in dialpad

Pricing:

Standard plan at $15 USD/mo/user, Pro plan at $25 USD/mo/user, 14-day free trial available

Security features:

  • SOC2® Type II and GDPR-compliant

  • Member of the Cloud Security Alliance (CSA) Security, Trust and Assurance Registry (STAR)

  • HIPAA-compliant

  • Customizable retention policy

  • Admins control access to data

  • Data ownership and reporting

  • Enterprise-level encryption on calls and data stored in the cloud

But hey, don't just take our word for it. See what other happy small business customers think about Dialpad on G2:

2. Phone.com

Phone.com offers a business communications solution using VoIP phones or adapted analog phones.

But, unlike Dialpad, it’s not really suitable for growing businesses and is missing a couple of major features like access controls, permissions, and online voice transmission.

Features:

  • Use business phone numbers or retain your old number

  • Voice, text messages, and video calling and conferencing options

  • Analog Telephone Adapter (ATA) allows you to use analog phones with VoIP office phone systems

Pricing:

Pro version at $29.99 USD/mo/user

3. FreeConferenceCall

Operating on a “pay what you can” model, FreeConferenceCall is a simple solution that suits families or businesses that need to keep track of every cent.

But as you would expect with a free service, the features are fairly limited when compared to a more robust phone system. (And some businesses feel the use of a “free” service can portray a negative image.)

Features:

  • International calls

  • Call recording

  • Video conferencing and screen sharing

  • Remote desktop

  • Broadcast capabilities

  • Radio feature to stream online conferences

Pricing:

Free, but you pay what you can (suggested amount is $4 per month)

4. GoToConnect

GoToConnect combines a VoIP phone system with video, audio, and web conferencing.

But, it offers less responsiveness from customer support and sales than you get with more customer-support-focused providers—and there is no option for multi-line call forwarding (something Dialpad does offer).

Features:

  • Streamlined support for contact centers

  • Cloud branch exchange

  • International calling

  • Call management

  • Call routing

  • Caller ID

  • Video conferencing

  • Personal meeting rooms

Pricing:

Standard level starts at $29 per user per month

5. 8x8

8x8 offers a single platform for cloud contact centers as well as audio, video, and text messaging solutions.

Some customers, though, have complained that there’s no ability to automate the deployment of the app (something Dialpad offers), which makes it a bit time-consuming to set up. The interface is also not the greatest and is hard to use.

Another interesting thing about “long-established” phone system providers like 8x8 is that yes, they have been around for a long time and position themselves as leaders, but the flip side of that is these leaders’ telephony infrastructure tends to be outdated, which can result in poor call quality and reliability. Just something to look out for if you’re considering these options.

Features:

  • Unlimited calling, SMS, and fax

  • Multi-level auto attendant

  • Call recording ability

  • Audio and visual voicemail

  • Caller ID

  • Call forwarding and transfers

  • Analytics

  • Easy admin

Pricing:

The 8x8 Express plan (basic) costs $12.00 per month per user. The X Series X2 plan (pro) costs $25.00 per month per user.

6. Ooma

Ooma’s platform allows you and your team members to stay in touch, work, and collaborate. But one shortcoming of Ooma is that when you integrate contacts on the mobile app, it changes your caller ID, which makes the experience inconsistent (and lowers the chances of someone picking up your call because they don't recognize your caller ID).

Features:

  • Desktop and mobile apps

  • Video conferencing

  • Auto attendant

  • Call forwarding and transfer

  • Virtual extensions

  • Voicemail

  • Call logs

  • Fax online

Pricing:

Pro version starts at $24.95 per month per user.

7. Grasshopper

Grasshopper is a cloud-based phone service that markets itself toward small businesses. Unlike Dialpad, it isn't a unified communications platform that combines phone services with video calling and other features. If you don't need to have video meetings or need SMS or instant messaging, then this might not be a dealbreaker for you.

Features:

  • Desktop and mobile apps

  • Voicemail transcription

  • Simultaneous call handling

  • Reporting

  • Business texting

  • VoIP / Wi-Fi calls

  • Virtual fax

  • Business phone number

  • Call forwarding and transfers

  • Voicemail

Pricing:

Flat charge for small business @ $80 per month.

8. RingCentral

Like Dialpad, RingCentral is a unified communications-as-a-service (UCaaS) solution that offers a wide range of tools. Unlike Dialpad, the basic plans don't offer any integrations, which might be worth considering if you're a smaller business and don't need the enterprise plan.

Features:

  • Desktop and mobile apps

  • Local, freephone, and vanity numbers

  • Voicemail to email and visual voicemail

  • Cloud PBX

  • Collaboration

  • Voicemail and greetings

  • Business SMS and MMS

  • Integrations

  • Internet fax

Pricing:

Premium plan is $34.99 per user per month.

9. Vonage

Vonage is another basic VoIP provider that's designed to be a replacement for landline phone systems. That means if you want basic features like call recording and visual voicemail (not to mention business essentials like video calls, conference calling or group calls, or text messaging), you'll need to pay for add-ons.

With a lack of features compared to other more robust phone systems on this list, this isn't really a solution that offers much to a business beyond a basic phone service.

Features:

  • Clear calls

  • Easy to set up

  • Good customer support

  • Toll-free number available

  • Call blocking

Pricing:

Basic plan is $19.99 per month per line, Premium plan is $29.99 per month per line.

10. Nextiva

Another UCaaS platform, Nextiva's integrations are a bit limited, and one eyebrow-raiser for us was the fact that they included "desktop and mobile app" as a feature under their Basic plan.

For any decent UCaaS platform, a good desktop and mobile app is a must-have. It's table stakes. Not a perk or feature of a plan.

Another note is they don't have SMS/MMS in the Basic plan—whereas Dialpad's lowest plan does come with unlimited texting.

Features:

  • HD VoIP

  • Unlimited calls (in the US)

  • Team chat

  • Voicemail

  • Auto attendant

Pricing:

Basic plan starts at $18.95 per user per month, Enterprise plan starts at $32.95 per user per month.

How to choose the phone system solution that’s right for your small business

You’ve probably heard this before. There’s no “one right office phone system” that’s a perfect fit for every single business.

So, make sure you take all the free trials out there for a test drive!

Make a list of some basic questions to ask on a demo with a service provider, and think about your unique business needs. For example:

  1. Do you need physical desk telephones or would you be fine with just a virtual phone system and cell phones?

  2. Do you want to stay old school and use an on-premises system or landline service? Or would you prefer a modern VoIP service that is more hands-off and easy-to-use, and lets you focus on running the business?

The small business phone system that lets you bring the office with you

When you’re looking for a phone system for your small business, the biggest question to ask is going to be around budget.

Not just how much you want to spend, but also whether you want to make a large investment up front or pay on a more flexible plan.

If flexibility isn’t important to you, you could get away with an older or more traditional phone system, but bear in mind that those also tend to require more of an investment from the start.

Make sure you choose a business phone service that is a good fit for both your business right now, and also where you want to go in the future.

Super advanced features are great and all, but if you have a small team (and no dedicated IT person), then ease of use should rank pretty high on your list of need-to-haves for your phone system.

Looking for an easy-to-set-up—but still powerful—small business phone system? 🏎️

Try Dialpad for free.