ClarityTel Industry Insights

Should Small Businesses Use VoIP Softphones?


One of the top concerns in running a successful small business is communications management. Finding a reliable, cost-effective method for staying in contact with internal and external customers is critical, and customer demands are high – people expect constant availability and attention, and swift resolution of issues when they arise.

A recent report found that 63% of businesses experience communications issues with customers, colleagues or employees that prevent them from reaching business goals on a weekly basis; and 30% have lost customers or employees1. 53% of employees would consider leaving their current job over communications issues, either with customers, management, or fellow employees.

Another study found that 85% of customers whose calls are not answered will not call back, and over 60% will take their business to a competitor2.

This is why many SMEs are considering using VoIP softphones for business communications. VoIP softphones are software programs that use the internet for voice or video calls. Software may be provided by a VoIP provider, or available through an applications store (think: Skype), and incorporates a user-friendly interface with many of the same features that are included with standard VoIP solutions.

Advantages of VoIP softphones include:

1. Cost of VoIP

VoIP softphones are generally less expensive than traditional business communications systems, as the company pays a flat monthly fee for bandwidth rather than for usage or a per-call charge. Capital investment and maintenance costs are reduced, as calls are made on computers or mobile devices rather than on dedicated phone equipment.

2. Remote access with VoIP

With VoIP softphones, employees are available to customers and clients anytime, anywhere, at the same phone number as when they are sitting at their desk. This improves communications consistency and availability, as well as customer service.

3. Less downtime and disruption

Internet providers have uptime guarantees that exceed 99%, with a 99.999% uptime guarantee as the industry gold standard. As long as the internet is available, VoIP softphones are operational.

4. Improved collaboration

VoIP softphones improve collaboration, by unifying communications to the employee’s primary work computer or device. Teams can communicate with one another at any time, from remote locations, improving the flexibility and agility of business information sharing and decision making.

5. VoIP features

VoIP softphones include many features that are not available with traditional telephony. These include video calls, drag-and-drop call transfers, visual voicemail, and incoming call notifications including caller ID. VoIP softphones also allow users to manage contacts and create rules for call forwarding, rerouting, call waiting and do not disturb settings.

However, there are downsides to consider as well. Disadvantages of VoIP softphones include:

  • Internet dependence: Limited / no access in the absence of an internet connection
  • Power dependence: some PBX systems connect to power through a telephony exchange, allowing them to remain active in the face of an unexpected power failure
  • Congestion: if the business doesn’t have the bandwidth or the lines become congested with internet traffic, VoIP softphone calls may be interrupted, dropped, fail to connect, or connect with poor quality
  • Distortion: VoIP softphones are more prone to distortion and interrupted communications due to packet loss or latency issues, which can result in distorted communications
  • Security: Unlike traditional communications systems, VoIP systems are vulnerable to hacker actions such as Distributed Denial of Service (DDos) attacks.

How to decide on the right small business phone system:

With all of the pros and cons, how can a small business owner decide if VoIP softphones are the right solution for their business communications?

Some important things to consider are:

Are your employees technologically literate? There may be a bit of a learning curve associated with VoIP softphones that is not involved with traditional phone systems or VoIP hardphones.

What is your bandwidth? The bandwidth available to your company will have a considerable effect on call availability and quality, so having enough – or better yet, an excess – of bandwidth is ideal for VoIP softphone use. If your bandwidth is already at capacity, or your business involves streaming or transferring large amounts of data which could interrupt communications, hardphones may be a better solution. 

Purchasing additional bandwidth through your internet service provider may offset some of the cost savings associated with VoIP softphones.

What can you afford? This decision, like many others, may come down to money. Purchasing a traditional PBX or VoIP hardphones represents a significant investment – one that the standard small business may not be able to meet. Companies using VoIP softphones must also ensure that employees have access to computers or mobile devices, but this equipment is generally in use for other business activities, not strictly communications.

What is your flexibility as to quality? Can your business withstand the occasional variation in call quality, or a dropped call? In certain companies, the most important communications are made by phone, but in others, they may be made by alternate channels such as email or text.

Selecting a communications system or your small business is an important decision, one that may have significant impact on your enterprise. Controlling costs is a significant concern, but so is meeting the communications needs of customers, colleagues and clients.

A business-critical decision requires careful consideration. Be sure to research phone, communications, ISP and VoIP providers to learn all of your options and system costs, and ensure that the system includes features necessary to your business.




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