Domestic and International Virtual Numbers, Fax Numbers, SIP Trunks, 800 Numbers and
CardSaver™ can be used as a billing and call monitoring solution for VoIP wholesale and termination providers. PEC understands that wholesale businesses can deal with high volumes of traffic and often very low profit margins, and thus has developed a product that can support the necessary requirements of the industry. With CardSaver™ you can terminate and track VoIP traffic for hundreds of customers at a time.
Since VoIP termination laws and regulations differ from country to country, it is difficult to recommend a definite solution. The best way to develop a successful business infrastructure is to mimic that of another successful business and correct their oversights.
There are many factors to consider when setting your selling rates. You need to consider your competition’s prices, your expenses, and the buying rates per destination.
Analyzing your competitor’s pricing is not as straight forward as it may seem. Sure, they advertise 8 cents a minute to India, and 1 cent per minute within the USA, but how much are they really charging? The truth is that the profit for most companies is NOT made with the per-minute charge, but rather, with the various fees that they charge to their customers. Yes, there are many cards in the market that do not have fees, but these cards always charge a significantly higher rate per minute. Below are the different fees that CardSaver supports:
So let’s take the scenario where your competition is charging 8 cents a minute to India. Let us assume they have an activation fee of 39 cents, a connection fee of 39 cents, and a billing increment of 3 minutes. There is no disconnect fee or maintenance fee. Let us also assume that the customer’s call lasted for 25 minutes (which rounds to 27 minutes if you are using 3 minute increments). The total cost of the call is as follows:
(27 minutes * $0.08) + ($0.39 activation fee) + ($0.39 connection fee) = $2.94
The total charge per minute is actually 11.8 cents, NOT 8 cents. That’s a 50% difference! Even if your cost is 9 cents per minute, which is more than the advertised price, this call would be profitable. So, as you can see, the profit is in the fees, not the charge per minute.
In Economics, the practice of setting different rates for different customers is called price discrimination. Almost every company takes advantage of this economic practice whether you realize it or not. The idea is to charge more to customers that are willing to pay more, and charge less to customers that are not. Put yourself in the following situation:
You are a resident of the United States, and you are on a business trip in France. You have just landed at an airport in Paris. Now, you need to find a way to call home and let your family know that you have arrived safely. You also need to call the office in the US and confirm the time of your meeting tomorrow. Would you mind spending 30 cents per minute for this call? Probably not, especially if your company is paying the bill!
CardSaver allows you to brand different cards and set different rates for each card, thus allowing you to take advantage of price discrimination.
Generally, when calling card companies create a new brand of card, it is targeted toward a specific region of the world. For example, one of PEC’s customers created a card called “Hello Africa” which targeted consumers wanting to call Africa The rates for Africa were set so that it would yield a 10% profit. The rates for calling to USA and UK were set to 5 cents per minute, which is still a reasonable rate, yielding a profit margin of 400%. It turned out that this customer made more profit from the few customers that called USA and UK than from customers calling Africa. Although most people will call the destinations you are targeting, do not forget that people will need to call other destinations as well, and they are usually willing to pay a premium.
By simply setting your selling rates higher than your buying rates, it does not guarantee that you will make a profit. You need to consider all your recurring expenses into the equation, such as your lines costs, your Internet cost, your printing costs, your co-location fees, and any miscellaneous business expenses that you may have. The largest expense is usually the distribution expense. It is always best to exaggerate expenses to consider the worst-case scenario.
First and foremost, you must develop a solid infrastructure for your prepaid calling card system to run on. Without a solid infrastructure, you will be spending more time worrying about your systems integrity than marketing your product. The following is a list of equipment and services that you will require to start the business. We have also included recommendations that we feel will ensure a solid infrastructure.
We list this item first not only because it is one of the products that we provide, but because it is the most vital in the list. Choosing a good billing software will ensure that every call made through your system is tracked and no call is left unbilled. CardSaver™ by PEC is not only a robust, dependable software package, it is also the simplest and most user-friendly package in the industry. CardSaver enables you to view reports on traffic passing in and out of your system. CardSaver also gives you complete control over your calling cards, including PIN generation, usage fees, expiration dates, and much more. CardSaver is a vital component for developing a solid infrastructure.
The VoIP gateway that handles all of the calls into and out of your system is the next vital component. If your hardware fails, your customers calls will not go through. Thus, we recommend choosing one of two brands for your VoIP gateway: Cisco or Quintum. Although we are a proud reseller of Quintum hardware, CardSaver fully integrates with Cisco VoIP gateways. These two vendors have a large following and many online forums exist where you can go to receive answers to any questions that you may have regarding configuration or specifications.
Today, you can purchase a Dell system for $499 with monitor included. That is a definitely a great deal, but unless you are only planning to use the system for Internet browsing and word processing, we do not recommend using these type of systems for your mission critical applications. You have a choice of using a high end server dedicated with a Windows Server OS, a Virtual Windows Server running on a VMWare platform, or just running a Virtual server in the CLOUD such as AWS or Azure. Depending on the requirements, PEC will recommend the best solution
The Internet service that you choose is the backbone of your calling card network. Choosing a reliable Internet service will ensure that your billing server and VoIP gateways will stay online. Ideally, you should place your servers in a co-location facility (i.e. 60 Hudson Street in New York). Internet service in a co-location facility is much less likely to go down than in your office or home. If you are placing your systems in a co-location facility, be sure to ask your Internet provider what kind of redundancy is available in case their service goes down; often, the provider will use the backbone of another Internet provider in this event. If your Internet provider does not have a failover plan, you may want to consider selecting a second Internet service as a backup.
The phone service that you choose is as important as the Internet service that you choose. If your phone lines are down, your customers cannot call into your system. Generally, phone service is more reliable than Internet service, so it not necessary to be as concerned about redundancy. However, be sure to choose the correct phone service for your application. If you have a system that supports T1 lines, make sure that the T1 is a PRI. If you require that the Caller ID is logged for every call, be sure to add Caller ID (ANI) service. If you have any questions about which lines to order, the best idea is to contact your equipment vendor or PEC.
In most places throughout the world, power outages are a daily event. If your systems are located in a place where power outages are common, it is essential to have some sort of power generator. For those living in places where electricity is taken for granted, it is still important to consider the integrity of your power service. It is essential, regardless of your location, to have a UPS battery backup. It is recommended that your battery backup can last at least two hours in case of a power outage. If you are placing your equipment in a co-location facility chances are that you will be connected to a generator, however, it is still necessary to have a UPS battery backup.
The above network diagram depicts what a typical prepaid system layout would look like. Please keep in mind that the CardSaver RADIUS Server, the CardSaver Web Server, and the CardSaver Database Server can be combined into one system.