08 Sep 2023


In today's rapidly advancing business world, effective communication is the cornerstone of success for small businesses. A reliable and feature-rich phone system is essential to connect with customers, partners, and employees seamlessly. Fortunately, modern technology has given rise to a wide range of options, with Voice over Internet Protocol (VoIP) emerging as a revolutionary for small businesses.

In this comprehensive guide, we will walk you through the process of setting up a phone system tailored to the unique needs of your small business. We'll explore the various types of phone systems available, understand the reasons why VoIP has become the preferred choice, and provide you with step-by-step instructions on how to set up your own VoIP phone system. By the end of this guide, you'll be equipped with the knowledge and confidence to take your small business communication to the next level.

What is a small business phone system?

A modern small business phone system offers the flexibility to handle multiple business lines for making and receiving calls while also providing specialised features tailored to the demands of contemporary sales and customer service teams. The evolution of business phone setups has witnessed significant transformations over time, marking a stark contrast between today's advanced phone systems and those of the past. To facilitate your preliminary research, we have already conducted a thorough analysis to identify the distinctions between these various phone systems.

Three primary categories of small business phone system

Following are the three primary categories of small business phone systems available in the market:

Analogue or Traditional phone system

The analogue phone system is the traditional method of transmitting signals through copper wires. These phones are hardware-based and rely on conventional wired networks. They lack scalability, requiring the establishment of new business phones and lines for each additional number or geographic location.


A PBX, or Private Branch Exchange, is essentially a private telephone network that connects multiple internal phone lines. Traditional PBX systems, like analogue phones, utilise physical wires and cables. However, more modern iterations, such as IP PBX, enable calls to be made over the internet. Nonetheless, IP PBX systems typically remain on-premises and require a PSTN (Public Switched Telephone Network) connection.


VoIP, or Voice over Internet Protocol, represents a contemporary business phone technology that allows calls to be made using a simple internet connection. Unlike PBX and analogue phones, VoIP systems eliminate the need for complex hardware installations. Cloud-based Hosted phone systems, hosted in data centers, are especially popular due to their straightforward setup and ease of use. This technology has become the preferred choice for many modern businesses.

Easy steps of how to set up a VoIP phone system for small business

Step 1: Investigate the leading VoIP business phone providers

The first step is researching various phone providers, each catering to different needs and budgets. Understanding your priorities and required features is crucial in choosing the right fit for your business. VoIP and legacy PBX are the two main options. VoIP uses internet telephony to transmit voice data as packets, while PBX relies on physical connections for call routing.

VoIP offers flexibility and is ideal for businesses with good internet connectivity, while PBX offers reliability but is best for businesses with a limited footprint and a high call volume. To make an informed decision, consult a managed voice provider to align your phone system with your business's operational needs.

Step 2: Assess your current internet speed

Once you know how many users you'll have, test your workplace internet connection to ensure it can handle VoIP at that volume. Inadequate bandwidth can lead to poor call quality and disrupt service. A quick and reliable internet connection is essential. A 500 Kbps upload speed supports around five lines, while 10 Mbps can handle at least 100 lines. However, remember that your bandwidth needs for VoIP are in addition to regular internet usage.

Consider upgrading your connection speed to accommodate both typical internet use and VoIP. Different speech protocols may also affect bandwidth usage, so consult your phone system provider for details. Fibre internet is a strong option for VoIP, but choosing the best service requires careful consideration, especially for those not familiar with these technologies.

Step 3: List the key phone features essential for your business

When choosing a VoIP system, consider which features are essential. Compile a list of must-have features before exploring VoIP providers, and consider your hardware preferences, be it traditional desk phones, desktop apps, mobile apps, or a mix. This list helps clarify your VoIP system investment. For instance, frequent travellers may require a strong mobile app, while businesses with over ten lines benefit from detailed call routing. Following are some key features to consider before compiling the list:

  • Customisable greetings
  • Voicemail to email/text
  • Unlimited extensions
  • Fax to email
  • Auto attendant
  • Smart call routing
  • Call analytics and conversation intelligence
  • Call recording
  • Local, international and toll-free calling
  • Conference calling
  • Integrations
  • etc.

Step 4: Calculate the number of phone lines required for your needs

By planning and managing your users effectively, you can optimize your VoIP phone system to meet your business's specific needs and ensure a smooth transition to the new system. For instance::

Identify users

Determine the number of users, which may not necessarily match the number of employees or phone extensions. Decide if all employees need a direct inward dialling number (DID).

Inclusive setup

Even if some employees do not require a DID, include them in the phone system to ensure they can receive and make calls when necessary.


Maintain a spreadsheet or document that details user information, phone extensions, desired call flows, and permissions. This documentation will help streamline the setup process and ensure everyone is accounted for from day one.

Step 5: Establish and review the SLA agreement with your VoIP provider

SLAs (Service Level Agreements) are contractual agreements between service providers and customers, outlining service standards and expectations. When implementing phone systems for your small business, it's vital to review and comprehend the SLAs provided by your VoIP provider. SLAs serve as a safeguard to ensure fair and dependable treatment from your service provider throughout the lifespan of your small business phone system.

VoIP packages typically involve two types of expenses: a monthly line rental fee and usage charges. You pay a monthly subscription fee for using the provider's services and may incur additional costs for outbound calls. Understanding the billing structure and the terms outlined in the SLA agreement with your VoIP provider is essential for making informed decisions and ensuring a smooth experience with your small business phone system.

Step 6: Transferring existing phone numbers

Phone numbers are a vital aspect of your company's identity and customer communication. When switching to a new phone system, it's crucial to migrate your existing phone numbers seamlessly.

Whether you use wireless, PSTN/analogue, or virtual numbers, your new service provider should be able to facilitate the transfer of your phone numbers. Additionally, you have the option to select new numbers if necessary. For a smoother transition to a cloud phone system, consider starting with temporary phone numbers and then proceeding with the porting process when it's convenient for your business. This approach ensures continuity in your communication while you make the switch.

Step 7: Set up and configure your phone

Setting up VoIP is very simple and straightforward. You plug your phone into your internet system, configure settings, and you are ready to use. But during setting up and configuring your VoIP phone, below are very important VoIP setup steps that help you identify work-related calls and ensure seamless integration of your work line with your corporate communication system.

Choose a phone number
  • Decide on a local, toll-free, or vanity number.
  • A vanity number can be a valuable asset for your business, providing a memorable and customised contact point.
Add an automated attendant
  • Enhance professionalism with an auto attendant.
  • This feature streamlines call routing and creates a polished impression.
Upload hold music
  • Select from preset hold music options to keep callers engaged and entertained.
  • Customise hold music to match your brand or customer preferences.
Record a voicemail greeting
  • Personalise greetings to reflect your business's identity and tone.
  • Voicemails can also be transcribed into text and sent to your email for quick message retrieval and management.
Set Up a Phone
  • One of VoIP's significant advantages is the ability to use your existing phone or mobile device as your work phone.

Step 8: Obtain any required hardware for your business phone system

For your VoIP setup, besides a reliable internet connection, you will need:

  • Modem and Router: Basic equipment for small business phone setup.
  • Device: Desktop, mobile phone, or laptop to install VoIP phone software.
  • IP Phone: Optionally, cloud providers offer wireless IP phones that donot require outlet connections.
  • VoIP Headsets: Recommended for agents, providing convenience over traditional phone receivers or laptop/desktop audio.

Step 9: Evaluating data security and privacy

When installing a business phone system, especially VoIP, data security and user information protection should be paramount. VoIP systems are susceptible to piracy attacks, eavesdropping, and denial-of-service attacks, potentially putting your private information at risk. Before proceeding with the installation, it's necessary to evaluate:

Provider security

Verify if your VoIP provider offers robust protection against potential security threats. Ensure they have measures in place to safeguard your data and communications.


Ensure that your chosen VoIP system complies with the data protection and privacy laws in the country where you plan to use it. This ensures that your communications remain in adherence to legal requirements.

Why do small businesses need VoIP phone systems?

VoIP phone systems are internet-based phone services that allow small businesses to communicate with their customers and partners more efficiently and cost-effectively. VoIP phone systems have many advantages over traditional analogue and PBX phone systems, such as:

Lower costs

VoIP phone systems can reduce the expenses of phone bills, hardware, maintenance, and installation. VoIP phone systems also offer unlimited nationwide calling and low international rates.

  • Cost reduction.
  • Unlimited nationwide calling.
  • Low international rates.

Improved voice quality

VoIP phone systems can deliver clearer and more natural voice quality than analogue phone systems, as long as you have a reliable internet connection and enough bandwidth. VoIP phone systems also use advanced codecs and encryption to reduce noise, interference, and security risks.

  • Clear and natural voice.
  • Reliable internet connection.
  • Sufficient bandwidth.
  • Advanced codecs.
  • Enhanced security.

More features

VoIP phone systems can provide a host of features that analogue phone systems cannot, such as video calling, SMS support, instant messaging, voicemail transcription, call recording, and integration with other business software. VoIP phone systems can also support unified communications as a service (UCaaS), which combines multiple channels of communication into one platform.

Supports multitasking

VoIP phone systems can enable you to do more than just voice calls. You can also send and receive text messages, images, videos, documents, and other media through your VoIP service. You can also integrate your VoIP phone system with other applications such as email, CRM, web browsers, and social media platforms.

  • Multimedia messaging.
  • Integration.
  • Enhanced communication.

Super easy scalability

VoIP phone systems can also scale up or down easily according to the needs of the business.

  • Easy scaling
  • Flexibly adjusts to changing business requirements.

Flexibility with softphones

VoIP phone systems can allow you to use softphones, which are software applications that emulate a phone on your computer or mobile device. Softphones can give you access to your VoIP service from anywhere with an internet connection, without the need for a physical phone or a dedicated phone line. Softphones can also offer features such as call forwarding, call transfer, call waiting, caller ID, and voicemail.

  • Accessibility.
  • No hardware is needed.
  • Feature-rich.

Final Words

A well-structured and efficient phone system is the lifeblood of any small business. In an era where communication technology continues to evolve, embracing a modern solution like VoIP is not just a choice but a strategic necessity. As we conclude our journey through the intricacies of setting up a small business phone system, remember that the right communication infrastructure can empower your business, enhance customer satisfaction, and drive growth.

By following the steps outlined in this guide, from researching providers to evaluating security measures, you can establish a robust VoIP phone system that caters to your specific needs. VoIP not only reduces costs but also offers an array of features that can boost your business's efficiency and professionalism.

In a world where every call counts and every customer interaction matters, your small business deserves a phone system that delivers reliability, flexibility, and advanced capabilities. Take the leap into the world of VoIP and watch your business thrive through seamless and cost-effective communication. Your journey to enhanced connectivity begins now.

Elevate your small business with crystal-clear calls, powerful features, and unbeatable cost savings. Make the smart choice today and ride the wave of success with Wavetel Business VoIP services.


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