It’s a fair question. With so many options out there for business phone systems—from basic analogue lines to fancy cloud-based setups—the prices can vary enormously.
Get it wrong, and you could end up paying way over the odds for something that doesn’t suit your needs. But find the right solution at the right price, and it can make running your enterprise so much easier.
In this article, I’m going to draw on my two decades of experience to cut through the jargon and give you a clear, no-nonsense answer on real-world costs for UK business phone systems.
We’ll run through the main options available, and look at what you can expect to pay for hardware, installation, monthly fees and more.
Choosing a Business Phone System in the UK
Firstly, let’s quickly recap the main categories of business phone systems here in the UK. The options boil down to:
- Analogue phone systems
- Digital / VoIP systems (either on-premises or cloud-based)
Choosing the right business phone system is not easy, but reading this guide will help you understand what are the options on the market.
Analogue Phone Systems
Analogue systems use old-school landline technology to transmit calls as an electrical voice signal over copper phone lines. They’ve been around since phones were invented so the technology is tried and tested. But analogue systems aren’t considered very advanced nowadays—you don’t get much management functionality or flexibility for growth.
Digital VoIP Systems
VoIP (“Voice over Internet Protocol”) systems work by converting voice signals into digital data packets and transmitting calls over the internet, rather than old-fashioned phone lines. This allows advanced features like intelligent call routing, conferencing, interactive voice menus and more. VoIP systems can be either “on-premises” (hosted at your office) or “cloud-based” (hosted remotely).
Cloud vs On-Premises: The Pros and Cons
Cloud-based systems don’t require any hardware onsite except phones, keeping setup costs down. But you rely on your internet connection. On-premises systems require an onsite private branch exchange (PBX) but give you more customization options and don’t need the internet to function.
Typical Costs for UK Business Phone Systems
Okay, down to the nitty-gritty! Here are typical costs you can expect to pay for business phone systems as a UK small business:
Hardware Costs
Analogue systems don’t have major hardware beyond the phones themselves. Entry-level digital PBXs for VoIP systems start from around £500 for a small setup supporting 10 extensions. Top-spec PBX appliances that support 100+ extensions cost upwards of £2,000. You may also need switches, routers and cabling which can all add £100s in costs. Cloud-based VoIP systems only require onsite IP handsets. Multi-line VoIP phones start around £50-£100 each.
Installation & Configuration
If going for an on-premises system, factor in install and setup charges. A qualified phone technician will charge around £100-£200 per day. Complex implementations could therefore cost £1000+ with labour, cabling, drilling, etc. Cloud-based VoIP systems can be set up in-house without a technician.
Monthly Charges
Ongoing phone system charges vary enormously between providers. Analogue lines typically cost from £15-£30 per month. Digital/VoIP solutions range from around £5 per extension/month for more basic packages, up to £50+ for high-end systems with all the bells and whistles. Call costs come on top at around 1-2p per minute. So budget from £20 per month for a very small business, up to several hundred pounds monthly for larger operations.
What is the Best Phone System for a Small Business?
There’s no one “best” system—it comes down to your unique priorities and budget. But most smaller businesses nowadays opt for a cloud-based VoIP solution given the lower startup costs and admin overhead compared to legacy on-premises setups.
Leading cloud PBX providers like Your Comms Group, RingCentral, Vonage and NFON all cater well for SMEs. Expect to pay from around £15 per extension/month plus call costs.
On top of that, you’ll need to budget for IP handsets (around £100 per phone). So an initial setup for 5 extensions plus associated phones could cost around £1000 upfront, then £100+ monthly ongoing.
Wrapping Up
I hope this outline gives you a better feel for likely costs when evaluating phone solutions for your small business here in the UK. To recap:
- Analogue systems are the cheapest but offer the least features and flexibility
- On-prem VoIP offers more customization but has higher startup costs
- Cloud-based VoIP balances functionality with lower hardware outlay
- Typical prices range from £20/month for basic setups, to £500+ for larger deployments
If you’re feeling overwhelmed or need advice tailored to your specific requirements, don’t hesitate to get in touch. With over 20 years of advising UK SMEs on telecoms, I’m always happy to chat through the best options for your needs and budget. Just drop me a line below to arrange a no-obligation discussion.