Selecting the Best Long-Distance Plan

Choosing the right long-distance plan can be frustrating for anyone, but for businesses the wrong plan is an especially costly burden. Consider these factors when choosing your company's plan.

Choosing the right long-distance plan can be a frustrating task. Most providers offer multiple plans, and a plan that works well for one customer might be a financial disaster for another. For most business customers, however, finding the best possible long-distance plan is simply too important to leave to chance.

To get the best plan for your business, you've got to understand your own calling patterns and requirements. Take several months of existing long-distance bills and use them to determine:

• How many calls you make a month
• The number of long-distance minutes you use each month
• The amount you pay for long distance each month
• The types of calls you typically make (direct dial, calling card, toll free)
• The average length of your calls
• The time of day you usually make calls
• Where you call (local, domestic long distance, or international)
• The rate per minute or rate per month
• Any monthly fees or minimum spending limit imposed by your provider

After you identify your usage patterns and know your calling profile, you're ready to take a look at the various types of plans and the costs and conditions associated with them.

Pricing and Calling Plans
Once you've determined your current per-minute rate, compare it to competitors' rates. Unfortunately, this isn't as simple as it sounds: Providers often advertise a single rate, then charge customers different rates for calls to different locations. For instance, a provider may advertise calls for 8 cents a minute, but that rate might apply only to out-of-state calls. The same provider may charge 12 cents a minute for long-distance calls within your state. This is why you need to know where you make long-distance calls, in addition to when and how often you call.

Variable Rate vs. Fixed-Rate Plans

Variable rates. Traditional long distance plans employ variable rates based on when you place a call. Generally, a variable plan will charge a much higher rate for calls placed during weekday business hours. Even though many providers have moved to fixed-rate plans, don't take it for granted that you'll pay a single rate for your calls.

Many long-distance providers offer plans that include deep discounts on calls made during specific days of the week. Although providers usually offer these discounts on Saturdays and Sundays, some providers use weekday promotions to attract business customers.

Fixed rates. A fixed-rate plan charges the same amount per minute no matter what time of day you place a call. Most providers charge a monthly fee for fixed-rate service.

Carriers tend to promote a single calling plan, but beware: One size does not necessarily fit all. Make sure that a provider offers a plan that suits your calling profile. Also watch out for short-term deals that offer discounted or free services. These "bargains" often last for only a few weeks or months. After that, if you don't cancel the service, it automatically continues at a much higher rate.

Additional Fees

Monthly charges. Many long-distance plans include monthly charges in addition to regular calling fees. A provider will impose this charge whether or not you actually make any calls that month. Most charges are between $1 and $5 per month, but some are higher. Ask whether your provider imposes a monthly charge and find out the exact amount. And don't be afraid to negotiate. If you are a high-volume customer, your provider might waive the monthly fee.

Minimums. Monthly minimum spending levels can be much more expensive. Customers are responsible for this minimum amount even if their bill does not exceed the amount. Typically, these spending levels are quite low (around $25), but some are much higher. When you select a plan, ask your provider if they require a minimum spending level.

Surcharges. There are also instances where a provider may impose a surcharge in addition to your per-minute rate. Surcharges are usually associated with calling cards or directory-assistance calls, and they can cost $1 or more per call. Ask your provider to detail all instances where they impose a per-call surcharge.

Explore Your Options
Don't be afraid to seek special promotions and deals: In this age of ferocious competition, providers will often bend over backwards to win or retain you as a customer. Ask if there are any other options you don't know about. Some providers, for example, have affinity programs that offer discounted rates to members of particular professional groups or associations. Providers may also offer incentive programs that reward long-term customers with rates that drop a set amount (e.g. a half cent per minute) for every six months that the customer stays with the plan.

Once you've selected a plan, review your telecommunications expenses every few months to make sure you're receiving the most competitive rates available for your business.

Read the Fine Print
Always get the terms and conditions of a calling plan in writing. When you read through the terms, be certain to read the fine print, and take note of all asterisks and disclaimers. Ask the provider to explain any ambiguous statements or disclaimers that you don't understand. When you receive your bill, scrutinize it to be sure that you're getting what you need and all that's stated in your contract. Learn more about understanding your phone bill to be sure you can interpret this complex document!

If you're also in the market for a phone system, read more about getting the right phone system for your business.

Visit AllBusiness.com to get more advice on business phone systems and cell phones to meet your office telecommunications needs.

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