Microsoft has four main Office products for business – Office 365 Essentials, Office 365 Business, Office 365 Business Premium and Microsoft 365 Business.
Despite the similar names, each plan comes with vastly different features at very different prices. Microsoft outlines some of these differences in a few charts on its website, but trying to determine exactly which one is best for you can involve a lot of thinking and figuring out exactly what you are getting for each plan.
When deciding whether to sign up for or upgrade to a new Microsoft plan, remember that you should choose a plan that can grow with your business. One of the biggest advantages Microsoft provides with these plans is flexibility. Use it wisely and sign up for a plan that fits your business now, because you can always change it. Most deals are signed on a yearly basis, but Microsoft provides the opportunity to switch your plan with the Switch Plans button in the admin center.
What Microsoft offers
Microsoft has rolled out several new features in recent months, including security updates, new applications, and general improvements and fixes. Many of these updates are available only for enterprise-level customers, according to Microsoft. It's important to note, however, that with the new update all Microsoft business plans will have access to Microsoft Teams, as it is now free. Here is a quick, very basic overview of each plan, how much it costs and why it could be good for your business.
- Office 365 Business Essentials ($5 per user, per month)
- Includes only web-based Microsoft services
- Great for extremely small businesses or businesses with a high-speed internet connection looking for fast performance with few desktop apps
- Office 365 Business ($8.25 per user, per month)
- Includes only the core, downloadable Microsoft desktop apps with no online services or business-class email
- Great for small businesses looking to only use the core Microsoft apps and OneDrive
- Office 365 Business Premium ($12.50 per user, per month)
- Includes all the desktop apps and all the web services Microsoft offers
- Ideal for small businesses with large teams that need serious file management and access to Microsoft's collaboration tools
- Microsoft 365 Business ($20 per user, per month)
- Includes all the features of Business Premium
- Builds on these features with mobile device management and IT security features
The 365 Business plans
Office 365 Business Essentials
Microsoft Essentials provides only the web-based services for small businesses. This includes web versions of the core Microsoft apps – PowerPoint, Word, Excel, and Outlook – as well as OneDrive and Skype for Business.
In addition to these collaboration tools, Microsoft provides SharePoint for team file sharing, Microsoft Teams for intra-office chats, and Yammer, a companywide social media network. Essentials is a great tool for very small companies – maybe only a few people total – looking to keep everything web-based. This service is comparable to Google's G Suite, which features similar web-based apps and email clients for communication, although it lacks collaboration programs like Teams and Yammer.
Office 365 Business
This plan features only downloadable core desktop apps. Users have access to PowerPoint, Excel, Word, OneNote, Access and Outlook, but that is basically it. Despite having access to Outlook, you won't have a business-class email client through Microsoft. That service, which is included in all the other plans, is a part of Microsoft Exchange, a web-based Microsoft program for email.
The only web-based service that Office 365 Business subscribers have access to is OneDrive. OneDrive, unlike SharePoint, is only focused on storing documents in the cloud and sharing them with co-workers. While SharePoint can also be used for this function, there are additional features in SharePoint, like the ability to set up Workflows, which notify members of a team when documents are edited.
Without a lot of the web-based services, the 365 Business package is best for business owners looking to only use the core Microsoft apps on their desktops. Office 365 Business plan holders won't have access to the paid version of Teams but can download a free version separately.
Office 365 Business Premium
This plan takes all the features of Essentials and 365 Business and blends them into a full-featured service. In addition to the full range of web-based services and desktop apps, Business Premium members have access to apps geared toward small businesses. These additional apps include Bookings, an online appointment scheduling service, and Connections, an email marketing client. This subscription plan is ideal for well-established businesses that need access to the full range of Microsoft services and collaboration tools.
Microsoft 365 Business
This service, which was released at the end of October 2017, has all the features of Business Premium, plus access to new IT security and mobile device management features. Business owners can control access to different levels of information for employees and groups of employees within the business through the admin dashboard.
Microsoft 365 Business users are automatically upgraded to Windows 10 when they subscribe, and Windows Defender is automatically turned on and set to auto-update. Microsoft also released new security updates for 365 Business users. These updates will protect employees from phishing and ransomware, and prevent unintentional leaks of business data.
The Microsoft package includes some mobile device management tools as well. Workers are prompted to enter a PIN to access work accounts on personal devices, and the program prevents copying and pasting between work and personal email accounts.
Business owners can remotely wipe company data from lost or stolen devices. These features can be used with or without a full-scale IT department, making it a great option for businesses looking to scale up that area.
In addition to Bookings and Connections, users have access to Invoicing, an app that syncs with QuickBooks and can be used to create custom-made, professional company invoices as well as other small business apps in the Microsoft Store.
Which is right for your business?
Choosing the right plan means figuring out exactly how big your business is, what kinds of services it needs and how much it is projected to grow. The benefit of these subscription packages is that you can change whenever you're ready. This means you can choose a plan and grow your usage with your business, instead of trying to fill the shoes of an expensive, over-featured plan like Microsoft 365 Business. Programs like Yammer or SharePoint do no good if they aren't used, so if you don't need these programs, it's worth it to choose a subscription package without them at a lower rate.
It's also important to note that these packages come with access to apps for download in the Microsoft Store as well. While different plans may provide access to different types of apps, you can still find add-ons that fit your business. If you're a Business Premium subscriber, for example, you can still use apps like Invoicing or Connections by downloading them from the Microsoft Store. This provides a lot of flexibility.
Bottom line
One of the benefits of Microsoft's small business packages is that they all include a lot of variety. While it can be hard to distinguish the plans at times, Microsoft has come up with a plan – or different options included in a plan – for a full range of small businesses. Flexibility is one of the best aspects of Microsoft's plans, so be sure to use it to your advantage.