Discover Which Types of Phone Systems are Right for Your Business

business phone

Phone systems have evolved significantly since the turn of the century and businesses now have more options than ever. To meet the needs of your company and get the right features, it’s necessary to know the differences between the major types of phone systems.

We are here to help you figure out which is right for you, so we compared three common systems and the company size each is right for.


A Private Branch Exchange (PBX) system is capable of handling both inbound and outbound calls. Instead of being operated by your local telephone company, it will be operated by your company. It’s designed to reduce the costs when there are a large volume of employees using a telephone system. While PBXs were often big and bulky in the past, the modern versions have come a long way and now only take up a minimal amount of space. Most of these systems offer all the basic features required to efficiently run your business and maintain communication.

This includes conference calling, auto attendant, call forwarding, and voice mail. Some take it one step further and have additional features like interactive voice response, custom greetings, and music on hold. A PBX phone system is best suited for larger businesses with more than 40 employees. According to Resource Nation, this type of system costs anywhere between $800 to $1,000 per employee depending on the features you want. If you’re in the startup or early growth stage and only have a handful of employees, this is probably overkill, but great for larger organizations.


A Key System Unit (KSU) is a central control device, which allows employees to call each other via office extensions. You can think of it as being much more sophisticated than a traditional phone line, but lacking some of the features as a PBX. However, a KSU has everything most small to mid-sized businesses need to keep telecommunication running smoothly. These systems are wall mounted and approximately the size of a medicine cabinet.

They cost a little less than a PBX and can range from $350 to $1,000 per employee. The exact price will depend on the features you want and the vendor you choose. A KSU is best fitted for businesses with 5 to 40 employees. It’s great if you’re in a period of grow, but don’t need all the bells and whistles of a PBX.


This is by far the most affordable option and will cost $100 to $250 per phone. The main difference between a KSU-less system and the previous two is it doesn’t have a central cabinet and doesn’t require any permanent wires to operate. Team members can still communicate with one another within an office, but conversations may not have the same call quality as a PBX or KSU. You are responsible for installing, setting up, and maintaining this system yourself and won’t usually go through a telecom provider.

A KSU-less system will offer standard features to cover your basic telecommunication needs, but lacks the customization often found with more sophisticated systems. However, it can be unplugged and transported as needed, which is beneficial for some companies. This alleviates much of the hassle if you end up changing locations later on. While this won’t cut it for large companies and many mid-sized companies, it’s sufficient for most smaller businesses with fewer than 10 employees.

Thanks to technological advancements and multiple types of phone systems, you can find an effective solution no matter how big or small your business is. Understanding the fundamental differences between these three systems should ensure you find the right fit without spending beyond budget. This way you can streamline telecommunication and keep operations running smoothly.

Image: MoneyBlogNewz, flickr

Nick Mann

Related Hardware Resources

Choosing the Right Web Hosting Provider for Your Company Website posted in Connectivity

How to choose a webhost

Is Data Sharing a Good Idea for Your Business? posted in Connectivity

Data sharing

How to Cut the Cost of Your Data Storage with Cloud Backup posted in Storage

cloud backup

Join the Conversation

  • Whenever your business is deciding on a new or replacement phone system you need to know how many phone lines and phones stations your business requires. Then the business needs to think about if they expect growth, adding the expansion capability at the initial install can be cost effective. If the business has mobile workers or multiple locations maybe a cloud phone system would be a option to consider.