A toll free number gives callers a way to contact your firm without having to pay for the call themselves.

In the past, the high startup costs of installing a toll free line placed the service out of reach for all but the highest volume users, such as very large firms or those doing extensive business in catalog sales.

Today, toll free, or "inbound," service is available to businesses of all sizes. New programs with low monthly fees have made the service cost effective for even the smallest businesses.

This buying guide is designed to give you the facts you need to obtain toll free service for your business. You can choose to read this guide from beginning to end, or jump directly to a section of interest by clicking on the links above.

Uses For Toll Free Service

External Use
Toll free numbers are most often used in connection with sales and marketing efforts--for example, taking orders or fielding customer inquiries. They are also commonly used for support functions such as technical help or assistance lines. Customers appreciate a toll free number, particularly during busy times when callers are placed on hold.

Internal Use
Toll free numbers can also be used internally. A toll free number gives traveling employees an easy and inexpensive way to call in to the office from any phone. In many cases, inbound calling is less expensive for the company than paying for a calling card call.

Toll Free Service Vendors

Long distance companies and resellers are the largest providers of inbound calling services. You can generally obtain inbound service from any firm that offers long distance service in your area.

Local telephone companies also offer inbound service for calls that originate from within their calling area. This can be combined with service from a long distance carrier to handle all types of calls.

Equipment

Unless you expect a very high volume of calls, toll free service typically utilizes your existing phone lines. This means no new equipment is necessary, since the toll free call will ring into the office phone system just like any normal call.

Higher volume users often prefer to purchase a dedicated line that carry inbound calls exclusively. Dedicated lines require paying for custom installation; however, these charges are usually offset by lower per-minute rates.

Comparing Programs

The two main considerations when choosing a toll free calling program are the rates you will pay and the features you require.

Rates range from nearly 30 cents per minute on some plans to less than 10 cents per minute with some high-volume programs. As a result, the plan you choose can have a tremendous effect on how much you end up paying for the service.

Most plans offer a similar set of basic calling features, although monthly charges and set-up charges may differ. You may want to look for options such as call blocking, which ensures that you do not get (and pay for) calls from areas you do not serve, or account codes, which restrict inbound access to employees or customers who know the correct code.

Larger businesses with dedicated inbound service can also consider more sophisticated features. If a business has more than one toll free number, Dialed Number Identification Service (DNIS) identifies the particular toll free number that was dialed. This can be used to distinguish between different marketing campaigns that all ring at a central location.

Another identification feature, known as ANI, is the same as caller ID service for the home. ANI allows a business to see the caller's number as the call is received. Some firms use this information to bring up customer information on a computer as the call comes through.

Switching Carriers

Portability also allows businesses to split toll free traffic on a given number across multiple carriers. For example, all in-state calls could be handled by the local telephone company while out-of-state calls could be handled by a national carrier.

888 Numbers

In March 1996, the FCC released the 888 area code to supplement the diminishing supply of 800 numbers. 888 numbers function in exactly the same way as 800 numbers, billing the recipient rather than the caller. Billing programs are also exactly the same.

However, there is still a lack of public understanding about 888 numbers, which means that 888 numbers will not be particularly well suited for marketing campaigns in the immediate future. Expect 888 numbers to become more commonplace and better understood in the coming year.

Pricing

The cost of toll free service includes a monthly fee and a per-minute charge. Monthly fees typically do not exceed $0-$20 per month, although special features may add slightly to this figure.

The per-minute charge can be a flat rate, or it can be banded, which means it varies according to the distance a particular call travels. In either case, per minute charges decrease as you attain higher calling volumes. Businesses receiving just a few calls a day can expect to pay about 20¢ per minute. Firms receiving thousands of minutes in calls per month should expect to pay 14¢ per minute or less.

Companies receiving more than 20,000 minutes per month on their toll free line may find a dedicated line to be more cost-efficient. Although installation fees can be high, per minute rates are much lower.

Buying Tips

If you get calls from pay phones...
As a byproduct of the Telecommunications Act of 1996, the Federal Communications Commission ruled in 1997 that pay phone owners deserved to be compensated for callers using their phones to make toll free calls. The resulting 28.4 cent charge per call has been passed onto long-distance carriers, who in turn pass it along to their toll free customers--in most cases hiking it up a few cents. If you expect to receive a lot of calls from pay phones and can't justify this per-call fee, contact your carrier. You can find out how it handles these charges and whether you will be allowed to block pay phone calls.

Examine smaller carriers
When choosing an inbound service provider, do not assume that well-known companies are necessarily the best choice. In fact, well-known providers are often considerably more expensive than smaller national and regional companies.

Watch out for term agreements
Term agreements lock you into a fixed rate for one to three years. With increased competition putting downward pressure on rates, now is not the time to lock yourself into a long-term commitment of more than one year.

The problem with monthly minimums
Be careful about agreeing to minimum monthly volume requirements. In many cases, your firm will be penalized if you fall below the minimum volume. Even if your monthly volume averages more than the minimum requirement, you can be penalized for one month that falls below the minimum.

Shorter billing increments will save you money
Look for programs that bill calls in the smallest possible increments. Programs using 6 or 1 second rounding will end up being 10%-20% less expensive than those using full-minute call rounding.