< Back to news 09 July, 2018

Equinox Warn Businesses To Be Wary Of Buying Your Telecoms Just On Price

Imagine going into a number of car sales rooms and saying; ‘I want a car what is your best price?’ You’d expect the sales person to start asking questions about what you’d be using the car for, the style, finishes, colour, what was more important to you - speed or economy, petrol or electric and possibly even your budget.
Guest article: Equinox

The one thing they would not do is just quote a price. And would you really want them to, without understanding what you will get for your money?

Yet it is now becoming more common for businesses just to ask for prices for telecoms - be it lines, broadband, mobiles or VoIP. We regularly see requests on LinkedIn asking for someone to ‘quote me for VoIP’ and then being surprised when people ask questions before quoting.

In the same way that not all cars are the same – neither are all telecoms solutions.   They are not commodities, despite the way some suppliers market them. I am not suggesting that you pay over the odds, rather trying to help businesses ask the right questions to ensure they are making apples vs apples comparisons, i.e. comparing like for like, and also not paying for services they don’t need, or getting trapped in long contracts that may appear cheaper to start with but over the long term are painfully expensive.

Let’s look at each option individually:

Broadband

There is no coincidence that suppliers offering the very cheap broadband prices e.g. Talk Talk and Plusnet often top Ofcom’s most complained about providers. It costs a certain amount to run a decent Internet network. People making a decision purely on the monthly cost should ask the following questions:

  1. What is the contention ratio of the line – i.e. how many are sharing it?
  2. How many network outages have you had in past 12 months?
  3. What router is supplied? There have been regular incidents of cheaper routers being hacked or compromised.If someone is charging £10 a month for broadband and giving you a free router it won’t be worth much
  4. What is average wait time when calling for support?
  5. What is average fix time for faults?
  6. What network is it on? This is important if you want to change providers at a later date.We see a number of suppliers moving services from BT to Talk Talk without telling the customer.It can be quite hard to move back.There is more choice of suppliers if you are on BT.

The main question, however, is to ask yourself what a day without internet would cost you, and does this provider increase the risk? We saw a pub that went for cheaper broadband which then went down on a Friday and was not fixed until the Monday. The pub lost £6,000 in takings over the weekend as their card machines were linked to the Internet.  

Connectivity

Lines

There are several telecoms companies that advertise themselves as ‘never beaten on price’ – they can’t all be right unless they are operating as a cartel. Frequently the claim links only to line rentals or calls to a specific destination. We have seen lines being sold at below the wholesale price, so, short of wanting to go out of business quickly the supplier will be clawing it back elsewhere. So be wary and check the points above, plus check the following:

  1. The price is fixed for duration of the contract
  2. No set up fees or minimum charges on calls - in the last few weeks we have seen a hotel in Norfolk and a care home in Lancashire being charged 26p set up fee on each and every call
  3. Calls rounded up to the nearest minute – this can add 25% to the overall cost of calls
  4. Prices to destinations you call regularly – are they competitive?
  5. Special promotions – a London charity was being offered free intra-site calls but then being charge five-times the market price for all other UK landline calls.

Mobiles

With mobiles the obvious thing to check is coverage for your location. There is no point signing a cheap deal if there is no signal at your office/business location. You should not rely on the networks checking either. We saw a company where the head office had coverage but their two regional offices didn’t - but the network still happily signed them up. It is not just office locations – check key staff home addresses as well if you are changing networks.

Some deals appear cheaper because they offer unlimited calls and lots of data but many companies don’t need them. Around a third of all mobile users no longer make any voice calls. The average business person uses well under 2GB of data each month.  One customer we reviewed found that 10% of their 1,000 phones had not been used at all in a year. So, check what you actually need before asking for prices - not just who can do the best deal on unlimited data.

Watch also for inflated hardware funds if you are not going SIM only. We’ve seen companies signed up to deals where the funds looked impressive only to find the cost of the actual handsets provided was inflated to 25-35% above normal prices. If you are going for a hardware fund ask for a hardware price list at the same time.

mobile


VoIP

As this is the newest of the technologies it is the one least understood by businesses. Therefore, there is more risk of misunderstanding offers or even been more easily misled.  It is the one that is closest to the car analogy as each businesses’ telecoms requirements are different. Some providers bundle handsets and calls into their prices – others include features that others charge for separately. So, things to consider before asking for a price:

  1. What features do I need today and may I want in the next few years?
  2. What is the ability of the company to develop new features? There are lots of self-built VoIP solutions out there where the development and support is dependent on only a few individuals. The advantage is that specific features can be added more quickly than the big platforms, but then there is the risk associated with what happens if they leave
  3. What handsets are you being offered? Are they a brand used by other VoIP companies should you wish to change supplier, and are they locked into your supplier? If included in the price, will you own them at the end of the contract?
  4. What are the out of call bundle charges (if bundles are offered)? Do your call volumes justify bundles? If the business is predominantly inbound then packages without calls may be better overall.
  5. What business continuity is in place if the host system falls over? Asking for uptime statistics over the past 12 months is a good idea
  6. If you are a small business with fewer than 10 employees, is your supplier signed up to the ombudsman? If not – why not?
  7. Ask about contract length and support statistics (as per advice above)

Finally watch out for the frequent scam of a ‘phone system for nothing’. These are invariably long dodgy lease hire deals and should be avoided at all costs. 

In summary, it is important to ensure you are getting a good deal but make sure you don’t end up paying more elsewhere. The quality of service will impact your business and other charges can far outweigh apparent savings.

For more information about Beacon and how we, along with our supply partners can help your business become more profitable, call 01904 695588.