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Buyer's Guide

Phone systems guide - What you need to know before buying

Welcome to the Phone Systems Buyers guide where we hope to make your online purchase of a new Telephone System nice and easy.

We intend to demystify the whole process and explain the industry terms and jargon and acronyms.
We aim to provide all the information that you might need to make an informed decision about which Phone System to buy, so you can select the right solution for your business needs. Our online configurators will be able to help and guide you through the whole purchase from start to finish, so that you can have a pre-programmed Quality Brand Phone System delivered to your nominated Business Address.

Of course, if you need any further advice or information, please do not hesitate to contact us, our friendly staff will be able to assist you. You can email us at This e-mail address is being protected from spambots. You need JavaScript enabled to view it or call us directly on 1300 302 276.


There are a number of important factors that need to be considered when selecting and purchasing a business phone system. These include: 

  • Understanding the advantages and disadvantages of the different types of phone systems available

  • Understanding the features available with business phone systems

  • Selecting a phone system ensuring the right capacity for your current needs as well as future growth

  • Evaluating financial options

This initial information is an essential first step in preparing you to establish and select a solution that matches your business communication requirements.

Types of Business Phone Systems

Business telephone systems can be referred to under many names - perhaps you are familiar with terms such as:

  • PABX system, or PBX system
  • Commander system, or Key system
  • VoIP system, or Converged System

Then again, perhaps you aren't familiar with any of these and that's why you're reading this guide! If this is the case then that is perfectly fine, however, it certainly won't hurt to be able to recognise some of this terminology to avoid confusion in the future and really assist you in gaining the best insight into what types of phone systems there are available to your business. 

Whilst there are a number of different types of business phone systems, each with different features, options and technologies (these differences can be large or actually very slight), they are all designed to offer your business with the necessary infrastructure to provide 3 basic services:

  • Make calls to customers through the networks of carriers (such as Telstra and Optus)
  • Direct and manage calls into and within your organisation as efficiently as possible
  • Optimise internal communication

Basically, there are 4 main types of business phone systems. We will briefly break down each of these types.

PABX (or PBX) Systems

Generally, PABX (or PBX) systems tend to cater for companies with a larger number of employees (40+), with the ability to provide some of the more advanced functionality and features than for example Commander or Key Systems (which will be discussed next). PABX stands for Private Automated Branch Exchange, and are differentiated from Commander or Key systems in that users of key systems manually select their own outgoing lines, whilst PBXs systems select the outgoing line automatically. PABX systems evolved from the telephone exchanges used by the telephone carriers such as Telstra and Optus, and initially required entire rooms dedicated to housing necessary central switching equipment. As with most areas of technology, the functionality of PABX systems has increased dramatically over time whilst the size of its main equipment has gradually declined and can now be rack-mounted and stored alongside a company's IT servers and associated equipment.

In relation to functionality, PABX systems are designed to perform 4 main call processing tasks:

  1. Establishing connections between two telephones (for example making sure that one of the phones isn't already busy)
  2. Maintaining the above connections for as long as the users require them (basically channelling voice signals for the duration of a call)
  3. Disconnecting the above connections as per the user's requirement (ie. when one user hangs up)
  4. Providing the required call information for accounting purposes (metering the costs of calls)
large business phone system

Most PABX systems will cover all or at least most of the features your business requires. While these features will be discussed later in the guide, it's also important to know that PBX systems are completely programmable and therefore can support even the most complex implementations, which will be discussed later in the guide.

Commander or Key Systems

With relevance to business phone systems, the term 'key' was a Bell System term used to describe the art for a manually operated switch, such as in-line buttons. Key or Commander systems can be primarily defined from other systems by individual line selection buttons for each connecting phone line, and were originally designed for companies with up to 50 employees. While the key system did have all of the core business telephony functions, it did not have some of the more sophisticated applications and features such as ACD or hospitality. However, telephone handsets designed and used with key systems were initially easier to use than those on the market with other systems, with dedicated keys for common functions like hold and transfer and LED's to indicate incoming lines and if other users on the system were on the phone. This feature is now considered assumed and present on all or most phone system handsets.

Key systems can be built using three principal architectures:

  • Electromechanical shared-control
  • Electronic shared-control
  • Independent keysets

As it is similar to PABX systems, Key or Commander Systems offer an extensive range of features (such as call blocking, forwarding, night services and voicemail), which will be discussed later in the guide.

New installations of true "key" systems have become less common, as 'Hybrid' systems (which will be discussed next) as well as PABX systems of comparable size now have similar costs and arguably greater functionality.

Hybrid Phone Systems

Today, the difference between Commander/Key systems and PABX systems is becoming increasingly blurred following the introduction by major business phone system manufacturers of digital "hybrid" systems, which can actually be customised to provide either PABX or key system functionality as required. These new hybrid systems have the capability to meet the specific requirements of 99% of businesses, quite an astounding figure. Whilst PABX systems still tend to dominate large corporate environments where more than 1,000 extensions are needed, or there is a requirement for the telephone system to integrate with specific and complex applications such as large call centres or hospitality front office applications. Hybrid systems are generally a much more popular choice than key systems among small to medium-sized businesses, particularly in the financial services industry and trading floors of offices. Some commentators describe the advent of the hybrid system has meant that key systems have abandoned their initial roots and have essentially become small PBX systems.

VoIP Systems

In relatively recent times, a new technology known as VoIP (Voice Over IP) has been introduced and is progressively becoming an important part of telecommunications. Using this new technology, regular voice calls are sent over a computer network as opposed to the previous use of traditional phone lines.

In its simplest form, VoIP requires a regular phone, an adapter, broadband Internet service, and a subscription to a VoIP service. When you place a call, it is sent over the Internet as data until it nears the recipient's destination. Then the call is translated back into a more traditional format and completes the trip over standard phone lines. Also known as Internet telephony, this allows for extremely cheap long-distance and international calls. For some businesses, VoIP systems have the capabilities to provide significant cost savings and other benefits.

VoIP telephone systems

For more information about VoIP Applications please contact us.

Business Phone System Features

In this section we go through the basic and advanced features offered in a business phone system. Knowledge of these features as well as what exactly your business needs will arm you from getting carried away or potentially stitched up in spending your money on features and options that aren't actually specific or required in your business, as well as making you aware of all the opportunities that a phone system can offer your business.
Whilst business telephone systems can be equipped with literally hundreds of features for purposes such as switching and redirecting calls and traffic, market and dealer research indicates that most companies will only use between 5% and 20% of their telephone features. As such, it's a good idea to focus on really honing in on the features that will actually influence and improve your business, communication and efficiency. This will avoid wasted time trawling through the hundreds of features, and will again avoid you being caught and even stitched up in the myriad of options available that you may not necessarily need. Instead of comparing the various system features on a one-to-one basis, you should examine how your phone system will actually be used in your organisation and make decisions based on this.
All systems have the absolute core features of call hold, transfer, pickup and paging through the phone or external speakers. However, the user boundaries for these features do vary from system to system so when you have narrowed your selection to two or three vendors, make sure you have a live demonstration of the operation of these.

Basic Telephone Handset Features

As previously mentioned, whilst the selection of your business phone system and accompanying features is very important, it is the actual telephone handset that is essentially the interface of your entire telecommunications plan, acting as the connecting point between the user (employee) and what the system actually has to offer. What you want is a handset that suits the user, one that makes the many features of your system easily and efficiently accessible and well used to ensure you achieve the results you were looking for when initially buying it.

Most manufacturers produce a range of telephone handsets, which are generally differentiated on the basis of:

  • Fixed and programmable keys: both for connection and transferral to various lines and extensions, or for commonly used features. These keys often incorporate multicolour LED to identify the status of calls on their own or other handsets in the office, or if a feature has been activated. Fixed function keys usually include the commonly used hold and transfer keys. The number of fixed and programmable keys can range greatly from 4 or 6 to 32+.
  • LCD display: The LCD display on a handset usually provides information on calls that are in progress, such as the name and extension of an internal caller, the duration of a call, and in some cases, the caller ID. It often provides an interactive menu to access the telephone system features. There are now many phones with large LCD displays and this feature is becoming more common.
  • Speakerphone capability. Speaker phones can be half-duplex, which means that only one person on the call can be heard at a time, or full-duplex, which lets both parties talk simultaneously, like a regular phone. Some phones also have a 'listen only' mode for speakerphone, which is useful for monitoring a conference call or while on hold.

Although having the right features is important, it is even more critical to ensure that these features are easy to access. Due to the fact most employees devote very little time to actually learning how to use a phone system, you should make sure that using the most common and important functions are extremely simple and intuitive. This is precisely why the selection of the telephone handset is so important.

Advanced Phone System Features

For organisations whose nature of business require more extensive or sophisticated use of telecommunications, modern corporate phone systems offer some more advanced options with significant benefits that can really lift your business efficiency in ways you may not have.

Automatic Call Forwarding

Automatic call forwarding is a feature that can greatly assist both employees and callers. By automatically routing incoming calls to wherever your employees are, whether on the road, working at home, or even at a remote location, automatic forwarding increases the likelihood that callers are able to reach the person they need with minimal effort and without having to make a second or third call. In addition, your employees avoid having to return to an overflowing voicemail box and waiting or unhappy customers.

Automatic Call Distribution (ACD)

Automatic Call Distribution offers any working environment the capability to both optimise their service for incoming callers as well as adjacently maximise staff productivity. ACD distributes calls within a group so that the first available agent takes the call. Additionally, if no agents are available the call can be held in a queue with a comforting message that their call will be attended to shortly. A group supervisor can also access real-time information on how the group is operating including the number of calls in queue, average queuing time and total incoming calls received.

ACD functionality is ideal for business departments that operate as an incoming call centre such as accounts, telephone sales or a technical help desk. Many telephone systems provide this functionality as standard. There are also more sophisticated call centre applications that integrate with the telephone system and are designed for specific needs of larger call centres. These applications include functionality like more sophisticated reporting, remote agent working and call routing to agents based on their skill levels.

Computer Telephony Integration (CTI)

Computer Telephony Integration (CTI) refers to any industry standard that allows non proprietary computer software applications to interface with the telephone system. The Microsoft TAPI standard is a commonly used CTI standard. The applications available for the purpose of CTI range from Windows based system administration tools that enable intuitive management of your telephone system features without the need to call a service technician, to sophisticated call centre applications. The key thing here for the user is the value the CTI application brings to your business.


Networking refers to the capability for business phone systems at multiple locations to be linked so that they operate as one virtual system with common features. For instance, a call in your Melbourne office could be transferred as easily to an extension in your networked Sydney system as to another Melbourne extension. Additional benefits of networking are the sharing of resources such as Voicemail or receptionists between sites, a significant plus where there are a number of small branch offices over a small or broad region. Today, networking is IP based and usually over a WAN. Some manufacturers claim their products can network with other vendors products using standards like QSIG, however it's important to note that the features supported in this circumstance are less extensive than those offered when networking between products from the same manufacturer.

Operator Console

An operator console is a terminal designed for the receptionist or operator of your company. The key feature of Operator Consoles are the capability of easy answering and transferring of calls to all over the workplace. This can be done by providing add-ons to handsets that provide multiple dedicated line and extension position keys, an effective solution for officers with up to 50 employees. In larger environments, or where the switchboard is very busy, dedicated operator consoles are the best option to ensure your business delivers a professional and efficient service to create the right image for your company. Today, most dedicated Operator Consoles are PC based with a headset and use the standard point and click operation to deliver incoming and internal calls to the correct person. They include features that:

  • Show the status of each extension on the system including if they are on a call or if diversions are set
  • Provide visibility of all calls on hold with notes
  • Transfer direct to mail box
  • Various more sophisticated hold and transfer functions to assist the efficiency of the busy operator 


Voicemail involves a system that acts as a corporate answering machine, recording messages from people both inside and outside a company that can be retrieved at any time. Voicemail systems use centralised recording equipment to record, store, and playback messages. Each user can have access to an individual mailbox, for which they can customize greetings for and keep private any messages left. Some voicemail products allow you to save fax messages as well. 

These systems are sized according to the number of ports, or connections, that are established between the phone system and the voice mail system. Having more ports on a voice mail system means more people can simultaneously leave or pick up messages. 

Compared to written notes, voice recording allows longer and more complex messages to be accurately relayed. The ability to leave detailed, private messages frequently means that callers can relay information without the need for a return call. This is especially useful when you consider that approximately one half of all calls are for one-way transfers of information.

Messages can also be accessed from outside the office and you can even have voice mail SMS your mobile of a voice mail message on your extension if you are out of the office. 

Voice mail systems also guarantee a common messaging platform within a company. Features such as broadcasting allow employees to send messages to multiple people at once, allowing a voice mail system to serve as a central messaging centre for a work-group or the entire company. 

Automated Attendant is also provided as part of most voice mail solutions. 

Voice mail can also be integrated with your computer network so that your voice messages and fax messages appear on and can be accessed from your Outlook Inbox sometimes referred to as Unified Messaging. Most voice mail solutions are now telephone system integral as the cost of proprietary voice mail has plummeted in the last few years.

Wireless Mobility

Wireless mobility could be described as creating your own mobile phone network within your office environment. More mobile users within the workplace (eg your IT support technicians or warehouse staff) within the company or those who have to be accessible at all times are provided with a wireless handset that is paired to their handset at their desk. Calls can be answered at either phone. Signals are provided by wireless base stations which allow automatic handover to another base station when a user moves out of range. Popular applications are in large retail outlets, large industrial, hospitality and hospitals.

Selecting the Right System for Your Business

The next step is establishing the size or dimensions of the phone system your business requires. This may seem relatively simple, however there are numerous factors involved and we aim to make this procedure as simple and effective for you as possible. Establishing how many lines and extensions you need (and what exactly this all means) as well as ensuring enough room for positive and negative growth is absolutely essential in ascertaining exactly what you require from your system before purchasing. When done properly, this can save you thousands of dollars in installation fees as well as services in the future.

Dimensioning a Telephone System

At the simplest level, Business Phone Systems are generally divided into 4 categories in relation to the size and number of employees that will use it.

  • Small: 1-8 Employees
  • Medium: 8-16 Employees
  • Large: 16-32 Employees
  • Corporate: more than 32 employees

However, when it comes to describing the exact dimensions of a phone system, there are numerous procedures.

In the steps leading up to purchasing a new phone system, it's absolutely essential that you know the exact size requirements of the system for your office, both in terms of physical dimensions and number of 'lines' and 'extensions' you will need the system to support.

Knowing these requirements in advance will best prepare you in making the right decisions when purchasing a system, and before this help to save both time and money during negotiations with any vendors and dealers that you work with.

There are two main factors that will determine the size of the office phone system you need:

1. Lines (or trunks)

  • The number of 'lines' or 'trunks' your business requires refers the total number of external phone lines, or ones that move outside the office, that are used by the company. Varying systems and other equipment are dependent on and can be adjusted to support the required number of external phone lines.
  • Whilst a small business may only utilise 2, 3 or even 1 phone line, larger workplaces will obviously utilise more and this is an important factor in selecting the best phone system.

2. Extensions

  • The number of 'extensions' refers to the total number of devices within the company that will require connection to the phone system.
  • While most of these 'extensions' will refer to telephone handsets, it also includes other equipment such as fax machines, credit card terminal and modems. Basically, any equipment that requires a phone connection must also be connected through the phone system and is therefore considered an 'extension'.

Describing the Size of a Phone System

The most common way of indicating relatively smaller sized systems is by using a combination of both lines and extensions in the following format:

Example: A "6x16" phone system indicates up to 6 lines and 16 extensions.

Alternatively, most digital hybrid or PABX systems are define in size in terms of "ports", which refers to the maximum number of connections that can be made to the system. Ports include outside lines and inside extensions, as well as other phone system accessories such as voicemail or automated attendants.

Buyers Guide Tip: Allow for future Growth

In addition to recognising that a telephone system can handle your current business internal and external phone traffic, it's crucial to be sure that it can also handle your future needs to ensure longevity and save you money. An ideal system should be able to handle expansion in the most cost-effective manner possible. Most systems will allow you to increase capacity by adding new cards that increase the total number of ports available, while some smaller systems are expandable by simply adding another cabinet identical to the first one installed.

For planning purposes, you should allow at least an additional 10% for organic growth, so when purchasing a system, inquire about how much it will cost to add at least 10% more capacity. You can and should also look at capacity increases of 20% and 30% to get an indication of the incremental costs involved, as they will vary with different systems.

Finance Options for buying a phone system

There are numerous options available in relation to financing your business phone system. The final section of this guide briefly covers the financial options and solutions available including lease, buy and bundle, as well as some tips, pros and cons of each. We also discuss the ongoing costs associated with maintaining and running a business phone system.

Much like other capital items for your business, you can conserve your working capital by financing the cost of your business telephone system. The standard forms of financing telephone systems include rental (sometimes known as Operating Leases) or Financial Lease. Both allow you to spread the payments typically over a three, four or five year term. It will of course be more difficult (and more costly) to obtain finance if your business has been operating for less than 3 years or you have some negative credit history.

Financial Lease

  • The distinguishing characteristic of a financial lease is that you own the asset and commit to a regular payment schedule for the term of the lease. At the end of the lease you will pay the finance company a once off amount (known as the residual), to complete the transaction.
  • The monthly payment schedule will include an interest charge for the financing of the phone system.
  • A lease cannot be cancelled without some penalty and you will need to enter into a separate service agreement for the equipment with your phone dealer.
  • The taxation treatment of the telephone system will be related to the depreciation schedule for the equipment and the interest component. You should consult your tax advisor for more detail on this.


  • One of the main advantages of rental is you reduce the obsolescence risk on your phone system as you do not technically own the asset.
  • At the end of the term of the agreement, you can either upgrade your telephone system to the latest technology or negotiate a reduced rental on your existing equipment if it still suits your requirements.
  • The monthly rental payment will usually be more expensive than a financial lease;
  • The rental agreement will also include early cancellation penalties.
  • If you require service support on your equipment, the service charge can be built into the monthly rental fee.
  • Taxation treatment is simpler with the monthly payment fully expensed.
  • You need to check that additional handsets and other expansions you will require during the rental term, can be easily added to the rental agreement

What to Finance

  • You can finance the total cost of the system including software applications and installation although there are guidelines on the software and installation cost as a proportion of the total finance amount.
  • Phone system dealers will have relationships with finance providers and will usually give you the option of renting or leasing the telephone system in their sales proposals.


Another form of finance option that is available for business telephone systems is called bundling and involves an agreement to rent a telephone system linked together to an agreement to use the telephone network services of a specific Telco. The benefit of this bundling is a reduced cost to you compared to entering into these agreements separately.

  • The bundling discount to you is usually provided by a credit on your monthly call charges provided your overall call costs reach a minimum level which is determined by your call history from previous telephone bills. Some bundling products provide the bundling discount as a percentage discount on the cost of your calls.
  • Not all dealers provide a bundling option, while there are some dealers who specialize in bundling all office products (phone systems, copiers, IT equipment with telephone network services


"The new phones are great!! And everyone is happy, especially the receptionists.
I'd be happy to recommend you to any potential customers.

Many thanks and have a great day"

Finance Manager

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