The overhaul will see more than 30 company-owned stores and sites upgraded with Nortel IP telephony and digital handsets, with similar packages offered to the company's 120-plus franchise stores around the country.

Edward Hore, Bob Jane T-Mart IT manager, said the phone system was also difficult to manage.

"Across the group we're spending more than A$2.4 million (US$1.8 million) annually on communication costs," he said.

"With the move to IP telephony we're aiming to save about A$800,000 a year, which doesn't factor in the productivity savings from simplified, centralized management and reduced equipment leasing fees. Based on these figures we can expect a return on investment in eight months."

Nortel's solution includes the installation of Business Communication Manager (BCM) 200 and 400 series IP PABXs at the retailer's stores, depots and auxiliary sites, coupled with a combination of Nortel 2002, 2004 and 2007 IP handsets to the desk, supporting more than 2000 staff nationally.