 time here for more systems and Despite it being 2020 and well We thought phone systems to be replaced by now and we'd just be using just some type of magical video system And although those video systems exist in 2020 phones are still ringing and we're still installing and still replacing Antiquated systems with VoIP systems and phones are still very relevant here in 2020 But the question comes up. Do you put it in the cloud? Do you use an on-prem PBX? Well, let's go over some cost analysis I'm gonna show you some numbers put together spreadsheet to help you make an informed decision and talk about different use cases for that But first you like to learn more about me or my company head over to Lawrence systems comm if you'd like to hire short project There's a hires button right at the top if you want to support this channel in other ways There's the affiliate links down below to get you deals and discounts on products and services We talk about on this channel including a link to our patreon if you'd like to become a patreon supporter We also have a swag store where you can get shirts and other items that are for sale and that changes from time to time what's available and what's not so go ahead and check that out frequently and Finally our forums if you'd like to have a more in-depth discussion about this video suggestions for new videos or just reach out Say hi and talk tech our forums are a great place for that. All right now back to the content now right off the start here I want to talk about the edge cases as in the really small businesses in terms of their phone needs and they only need like Maybe one to three phones. Maybe even four phones On-prem may not make a whole lot of sense for you It will save you money over time, but not near as substantial as the example We're gonna do with a 13 phone system office So if you're a small business and we sell a lot of these like we have a salon We have a couple of offices and lots of other small businesses that only need like two phones. Well the cloud systems work great We've been really happy with a couple different options on there I'm not going to endorse any particular one at this moment But for examples we are going to be covering ring sensualness because they have all their prices listed publicly So in those cases, yeah, you don't need to go any further if you're just a one person two person office in terms of your phone needs Then the cloud systems make a lot of sense Now pricing where did I get these numbers from? Well, I'm gonna leave links But one thing I noticed right away is ring sensuals nice. They publish all their prices. We're not a ring sensual reseller So there's nothing I can do. I don't resell actually for anything on this list But I was looking through the prices on this Site called price it here comm and they list out and roughly between 20 and 25 dollars a month is what a lot of the different phone systems are charging and ring sensual publishes it a lot of the other companies where Contact our sales people and let them hound you forever and we'll tell you the prices So I'm just gonna show that as some comparative phone options But ring sensual because they publish the prices right here and if you prepay annually You can save 33% they have 2499 a month and like I said if you're that small office And you don't want to buy an on-prem system 25 bucks a month for your phone or for each phone Yeah, not too bad, and that's also annually because if you look at it monthly, it's much more Let's go back to the annual price here. We will be basing this on annual pricing For the sake of this video, but yes I know it's technically not gonna met line up when you see the numbers because I broke down monthly recurring costs But you know you're actually paying them annually, but we'll go we'll cover those in detail when we get to the numbers part VoIP MS now, this is the alternative when you buy a non-prem system. You still got to buy your dial tone from somewhere We really are happy to VoIP MS fold disclosure. Yes, there's an offer code. I have for VoIP MS They're not channel partner only or Require any offer code to sign up, but it does help the channel if you do sign up through VoIP MS They're a service we use here at the company their service. We recommend to our clients We really like VoIP MS a couple different options pay-per-minute plans on the 85 cents per line 0.009 per minute. Yes, that's the please note That's really low per minute rates or they have 425 per DID for an unlimited plan Up to two channels versus unlimited channels over here So there's a couple different Differences here you're gonna have to calculate how many minutes you use to figure out exactly how much it's gonna cost you Now these are outgoing rates of 0.01 cent. These are incoming rates of 0.009 cents So roughly just under one cent a minute for the incoming calls and 0.01 cents for the outgoing and you have a line cost for every line you have every direct dial not every phone That's a good thing. I want to make sure people don't conflate You may have one phone number, but 20 phones and for example us we have a single phone number and we have Eight or nine phones in the office right now. We have seven people usually using them. There's not a limit That's why it's the channel's usage is unlimited, but we it all comes from or goes to one single phone number for us so It's gonna depend on your use case when you look at some of the other cloud systems a lot of times are a one-to-one ratio So for every phone you have they tie to and I know ring central I believe still does this tie it to a phone number even if it's not your main number They need other numbers to tie it to so there can be some other costs associated with the ring central But to keep it simple. We're just gonna assume the 24 99 prepaid annually now The numbers here this is quote issued to McTest face and McTest faces our test client that we use things But this is actually just a cloned quote from exactly what we just sold to another client with 13 systems Complete phone system pbx exact you see 25 With three-year warranty bronze level support 12 Sangoma s505 phones one Sangoma s505 sidecar So that's the expansion Yay link w60p the cordless and like I said, it's a pretty solid phone system that we sold them here We have our on-site installation the phone system at 450 the non number porting assistance to port their numbers over to VoIP And as they have actually have a couple different numbers three of them They're gonna be porting 240 for that set up there and that's gonna total cost to get this whole thing set up $6,918 so let's put these on spreadsheets so we can talk to the numbers so ring central so gonna buy phones now I put a hundred dollars per phone for ring central granted It depends which phone you buy some phones are gonna be a little bit less some phones a bit more and ring central Sometimes offers deals where they'll roll the phones into the month of recurring or they may offer you a discount offer Upfront purchase on the phone because you signed a deal with them for a couple years There's different options, but we just put it at a hundred dollars a phone But I'll leave a link to spreadsheets so you can copy it and adjust it yourself To do the calculations, but at a hundred dollars a phone that's your upfront cost I want the upfront cost for putting an on-prem free PBX system like we do well It's a lot more. It's gonna be like I said This is the installed not just hardware prices, but the us coming in setting it up That's would be not included here for ring central because you have to set up yourself We'll ring central pretty easy plug it in and the client could have opted to plug it in themselves But they chose to pay us to come out and set it up But that is all part of that total one other thing to caveat before we go any further numbers Yes ring central for that price does offer their own custom video service, which is actually rebranded zoom So that is a feature you don't get with free PBX But that's also a feature most people already have with whatever they're using either office 365 or G suite But at least mention it is worth noting that yes that you're gonna get that one ring central You're not gonna get that we're free PBX So there are it's I'm trying to make it as close of a comparison as I can but it's not a hundred percent obviously So back over to monthly recurring so assuming you prepaid annually But we divided it by to see what the month of recurring is you're looking at with 13 phones at the 2499 a month so what we have here is 2499 times 13, which equals $324.87 a month and When we look at the month of recurring for VoIP MS So they paid all the money in front but now they're on VoIP MS and this is based on their minutes usage For exactly how many minutes they use in it comes out to be twenty five dollars per month. That's not bad So what does this look like annually? So year one you're gonna spend three thousand eight hundred ninety eight dollars and forty four cents not including some other taxes and things They throw in there and Year two or year one years look at three hundred and twenty five dollars after year two another three thousand eight hundred ninety eight forty four dollars and you're technically paying it a year up front if you're wanting that price you're going to be paying more on and Year two we're still paying three hundred twenty five. Where does that put us after two years? Well ring central Once you start adding up the upfront costs in the year one in year two costs right at nine thousand ninety six dollars versus on-prem Seven thousand five hundred sixty eight dollars. So a fifteen hundred dollar savings only after two years But how do you look at that asset over time? Well year three year four year five? And I'm assuming a five-year life cycle on phone systems, which you know They last longer than that We've seen some systems in generally speaking even free pbx ones that have been around sitting there not updated No one's ever touched them no maintenance plan or anything and they're running seven years later perfectly fine the phone systems are pretty solid and Provides you use good hardware to build them on they do last a long time, but let's look at a five-year. So after year five Including here's all the monthly recurring But let's also look at the total for all the parts and everything we did to set it up and all the monthly recurring is all Summed together ring central has us at twenty thousand seven hundred and ninety two dollars and twenty cents and on-prem is 8,543 now five-year savings of $12,249 So that's fairly substantial. That's just over five years on an office with 13 people now What other exceptions what are the things I'm leaving out and I will admit I'm leaving some things out What about if they needed to change something? We've actually found that yes people need to change things Occasionally not as much as you might think a lot of times the phone systems aren't quite set it and forget it But you know a lot of times unless they're Changing a lot of employees and staff there's not a lot going on with the phone system Other than maybe changing a name here and there small billable increments. Yes, you maybe Clients are spending another two hundred dollars a year unless they're really firing and hiring a lot of people and usually the Clients that we have that are going through people They don't even bother assigning the phone a name They just call it, you know accounting or dispatch or some generic name because they know that employee may not last their Long so they usually have strategies around that so it's not that big of a deal I'm you know, you're you're going to have those little billings for the move ads and changes that may occur over time But they're really they're not going to be $12,000 worth of move ad change over the years So I'm going to tell you you save a lot of money on this over time Provided that you're willing to set up something like VoIPMS and manage it now If you want to pay us to manage it companies do that as well Or you know you can do that if you're an IT person you want to manage it for them and put a small markup You can't what I've seen a lot of times in the phone system markets is putting Substantial markups on there and what's really happening is well people have Google and they start looking for how do we buy VoIP? services and some companies that are not Super tech savvy figured out really quick. Well, it's not that hard to use VoIPMS. I don't need a degree I don't need to have a computer science degree to understand how this works You get it on from PBX system you plug it in now you can choose different PBX systems and still use VoIPMS I just happen to really like the way it works with free PBX I know some people are going to be asking of course, can I review their favorite voice system like 3cx or whatever? We're very familiar with free PBX. I really like the system. I like the Sangoma implementation of it We've kind of settled on that. It's a lot to learn many different systems We have clients with different systems who we still put on VoIPMS and it's worked that does include companies with 3cx I'm just less familiar with it. I don't know all the pricing on it We're also not a 3cx partner free PBX is free as the name implies We like the Sangoma implementation because you get a couple extras with it for some of the licenses And you know, I'm not going to get too off topic on that But we think it's a really solid product and it works quite well now The overall the other thing that I know that I've gotten in a couple Not heated at all but debates of business philosophy is I have those vars who have contacted me the multi resellers of phone Services that want me to start reselling all their options and putting 20 30% markup So you can get commissions on it and things like that and they're already also making a commission on it One thing this does is break that business model because you're selling direct essentially a VoIPMS and VoIPMS pricing is kind of what they Maybe they pay a little less But you kind of get the idea what they're paying for it and we've taken some clients that were paying You know $400 a month and phone bills brought them down to like 80 bucks a month It's it's substantial savings. We've done especially with some of the larger clients by putting them on this and that's with us managing it Even with us managing it for a very small percentage markup I say small percentage because some of these companies are just used to and I guess that's just the way the phone market worked for a long time They're used to 10,000 or some incredible percentage markup on Selling it and then not answering the phone then not really doing any service And it's not that I'm complaining about people that make money or anything I'm someone who charges for my services as well But man some of these companies we pulled away from they were not easy to deal with not easy to get any help from and they were marking Up the bill and then to find out one of them when we logged into their free pbx system Yes, they had an on-prem system and they were paying this company for the phone bill It was substantial. It turns out they were using vitality in the back end We've seen all the settings and pre pbx and go oh look they're just using vitality Which is an also like another competitor to VoIPMS and also He has the same roughly the same rates and you can kind of see their markup on there So, you know switching these companies over which like there's different business philosophies You may or may not agree with me and I know there's somebody with their caps lock on punching in your comments down below I'm sure but um, I'm just showing you the numbers and showing you what you can save and showing people what they can save We've done this for quite a few of our clients. We're doing it for a lot more of them We've kind of settled on the combination of free pbx and VoIPMS together. It works really really well and Clients are really excited when you're saving them a lot of money They're going wow you guys are doing something for us that's helping us and it is more working with the clients who create a savings plan Up versus I've seen some IT people and sorry if I maybe you disagree with me on this But they try to resell everything at massive markups to try to make everything they touched Any type of touch point with their client becomes a way to mark something up as opposed to just leveraging knowledge And it's a little bit of different business philosophy than when I have so Maybe I'm wrong. At least someone will tell me I'm wrong, but I'm going to keep doing it this way I'll leave links so you can see all this this is kind of like a summary of how we do phone systems and how we started You know helping some of these clients transition to it So whether or not you want to put in the cloud is still ultimately up to you I just like to put information out there leave links so you can do your own reading make your own informed decisions I think that's what's important. 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