Photo: JustLife, YFS Magazine, Adobe Stock

Battle for the Bottom Line: How SMBs Save on Telecom Costs

Telecom services can be a major expense for small businesses.

Companies are just like family households in that every month payments are made to vendors for a host of products and services. However, most of the time, purchases by families are deliberate and thoughtful exchanges of value where the household pays something and gets a product or service back that is needed and wanted.

Every month, a company’s battle for the bottom line is just as real. Larger multi-location companies receive many bills, and sometimes they do not see or understand the benefit for which they are paying. As a result, companies often pay for services they are no longer using, insure assets they are no longer holding, or order products that have become useless.


How to Find Telco Transactions

Telecom services can be a major expense for small businesses. Some industries spend more than others on telecom services. Core telecom services include a data network, cloud connectivity, mobile wireless, and work from home (broadband services, etc).

When it comes to telco services, sometimes two data subscriptions will be where only one is needed, data lines that were thought to be disconnected are still being billed, and locations that a company no longer operates from still have telco services billed to them.

The truth is out there for them to discover. Still, the problem is that the truth is often buried deep in a 5” thick invoice. There is relatively no way you could find it without ordering Customer Service Records from your phone company to research. These “records” might as well be hieroglyphics, so get out your language learning app!

The bills for all these individual transactions add up quickly. Telco expenses are a famous (or infamous) example of how corporate spending will go haywire without proper monitoring. The waste (cost) that results from the chaos is, at any rate, enormous.

An audit and optimization of telco billing can decrease 35% of companies’ voice/data and cloud spending. A mid-size company can easily spend $250,000 on telco services each year. It takes no degree in advanced math to figure out that the said optimization will yield considerable savings.


How to Cut Down Telco Waste

So, where should companies start when they want to cut waste? First, they need to have an auditing procedure where a complete inventory, line-by-line, is made of all the company’s telco bills at least once a year. Such inventory, which should be established by location and product, needs to include the billed rate, contracted rate, and contract start and stop dates.

The finished inventory then needs to be audited, where a company will look at the contracted rate versus what the carriers bill. A company that is being overbilled should ask for a credit to its carrier to recuperate as much as possible from what was paid more than the contract.

Sometimes a company is not simply being overbilled for a service it still wants to use but finds itself billed for a service it no longer needs or wants to change. So, when a service has to be moved, disconnected, or altered in other ways, an order needs to be put in with the carrier where a change request is made. In addition, we recommend monitoring what the following bills look like to make sure those order requests have indeed been fulfilled.


How to Monitor Telco Expenditures

It is crucial to have a system in place to rationalize telco expenditures. Everything starts with an inventory. Then an assessment is made, and change requests are filed and monitored to determine whether those changes have been fulfilled. The entire operation’s success hinges on the performance of the weakest link.

Companies will need specialized know-how to run through the process outlined above. If they do not outsource the work to a technical service provider, they will need to implement their own Telecom Expense Management (TEM) that can fill the gaps in internal IT and AP resources. Such investment might be an option for the most prominent companies but will be very difficult to carry for many companies in the mid-size segment.



Whatever route companies take, not correctly managing this process on an ongoing basis will cost companies millions of dollars. At the same time, an experienced team—either in-house or outsourced—will be a fraction of that expense.

Bart Zimmerman, CEO, and founder of Digital Direction, is a nationally recognized expert in telecommunications with more than 25 years of experience in telecom management services. He has worked with hundreds of companies across the globe in various industries to help them improve their telecom processes—more info at digitaldirection.com.


© YFS Magazine. All Rights Reserved. Copying prohibited. All material is protected by U.S. and international copyright laws. Unauthorized reproduction or distribution of this material is prohibited. Sharing of this material under Attribution-NonCommercial-NoDerivatives 4.0 International terms, listed here, is permitted.


Photo: JustLife, YFS Magazine, Adobe Stock
In this article

Copy link
Powered by Social Snap