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Thread: Reseller hosting for profit

  1. #1
    Senior Member
    Join Date
    Sep 2010

    Reseller hosting for profit


    There is without doubt a premium for which businesses will pay for the 'convenience' factor. The idea of handing over the management of their site in it's entirity to a third party is very attractive. Particularly to the smaller companies where time and resources are at a premium, it's often the case that proprieters would often prefer to pay a small extra amount not to have to go to the trouble of finding a host.

    This isn't to say that hosting is an opportunity to rip off your clients left, right and central. However the additional revenue can be substantial.
    The vast majority of business sites are hosted on plans that have far more resources than they will ever hope to need. It is a well touted formula amongst hosting professionals that 80% of customers use less than 20% of their allocated resources.

    Therefore, if you have a small brochureware site for a local company that is well optimised, you can safely assume that they are highly unlikely to use any more than 1Gb of traffic at worst and probably under 100Mb.

    There are plenty examples of 20Gb bandwidth / 2Gb space reseller packages at $40. So in total for the year, your hosting costs would be $480. Charging only $75 a year for 15 accounts of the size previously mentioned gives you an income of $645. $75 a year is something and nothing to your average business man and will undoubtably be just a fraction of the site development costs. This also leaves 5Gb of bandwidth and 500Mb of space for contingency.

    As you can see, these are really baseline calculations. Most of the time you would charge higher than the estimated rate and therefore increase profits further. In addition, higher quota's for each customer would attract higher charges.

    Choosing a host

    The need to choose a reseller host that you can rely on is absolutely paramount. If you choose to take hosting on as a service, your business is about to rely on someone else's business. Every time they let you down, your going to let down all of your clients, now is not the time to go for the cheapest option you can find as it is more than likely to turn out a false economy. There are a number of highly respected resellers and research at this point is highly advised.

    Benefits to you

    One of the nicest benefits to offering your own hosting is the consistency you enjoy as a designer/developer. You don't have to adjust to different control panels, you can avoid the infamous client cry of 'BUT I've lost my passwords', and you maintain control at all times.

    The drawbacks

    The most obvious drawback is that you will always be the first contact in the event of downtime and you will also be required to provide all first level technical support. Tools such as well developed Flash Tutorials can reduce your support burden however you are going to need to consider how you will deal with a situation where you are on a beach in the Bahama's and the server is flat on the floor.

  2. #2
    Join Date
    Feb 2014
    Reseller hosting is good for those planning to start their own web hosting company.

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