So You Want to Get into Reseller Hosting

Everyone’s got a web presence these days, and the Internet continues to grow rapidly with every passing year. With people churning out new site ideas all the time, there doesn’t seem to be an end to the demand for hosting. Many budding online entrepreneurs have found a lively market in the web hosting industry, and you might be thinking of joining them.

Here at Comparakeet, we’re dedicated to helping you make the best decisions–whether you’re checking out goods and services or pondering your next business venture. If you’re considering a jump into the web hosting business, then you’re off to a good start. In this short article, we’ve gone over the most important pros and cons that every budding reseller should know.

How Do You Even Start?

Before anything else, you should consider how you’ll go about your reselling gig. There are a number of options at your disposal, and your choice will determine which pros and cons are going to be most relevant for you.

Reseller Plans

The easiest way to start your own web hosting business is through a reseller hosting plan. A typical plan will have you paying a monthly fee for a chunk of resources that you can partition into custom hosting packages. Some will have preset packages and charge you per client instead. Either way, you’ll oversee those hosting packages through a main control panel, where you’ll have the power to create and supervise separate accounts for your clients.

Most of these plans give you around 50-100 GB of disk space and 1-5 TB of bandwidth on average. If you suspect you’ll need much more, consider going the VPS route instead.

VPS Hosting

With a virtual private server (VPS), you’ll get a much larger dedicated virtual environment for yourself and your potential clients. You might have to go a bit DIY, as your hosting plan might not come with reseller tools out of the box. Not all VPS hosting plans will let you resell chunks of your virtual server space, too, so double-check with your provider first. We’ve got a great list featuring the best VPS hosting providers out there, if you’re looking for a place to start.

Dedicated Hosting

With dedicated hosting, you’ll have an entire server to use as you see fit. That can potentially include reselling. Again, check with your provider first. Depending on your dedicated hosting plan, you might not need to think about server maintenance and support–but remember that you’ll need to consider what services you can and cannot extend to your hosting clients, too. Check out our list of the top dedicated hosting providers for the best options available today.

Why Resell?

There are some benefits to reseller hosting that are applicable no matter which option you choose.

Regular Income

Extended use of hosting resources and services means periodic payments, and your clients’ fees can serve as a reliable source of cash. The stability and peace of mind that comes from a regular inflow of money is nothing to sneeze at, and reselling delivers that for relatively less effort than most businesses. Why? The nature of web hosting lends itself to a “set it and forget it” arrangement, with most customers needing little beyond occasional tech support once their accounts have been set up.

Synergy

Reselling doesn’t have to be your main business. If you’re a developer, web designer, or work in another field that provides mainly web-based output, then web hosting could be a great complementary service to offer with your main product. It adds value to your main sell and serves as an extra source of revenue for you. Win/win, right?

Control

You’ll have the power, in nearly every sense of the phrase. Design hosting packages that best fit your target audience’s needs? You can do it. Set package prices, payment modes, and billing terms? Of course you can. Determine just how to divvy up your resources or how many clients to take on? Why yes, you’ll be able to do that, too.

Low starting cost

This is more dependent on the reselling structure you picked for your business. Most reseller hosting plans come at affordable prices. In fact, some won’t even charge you a thing when you start. Either way, you won’t need to think about buying equipment, maintaining servers, or any such expenses. VPS or dedicated hosting-based models will likely cost you a bit more, mainly because you’ll get more resources. Unless you get a managed server plan, too, expect to pour in more money and effort if you go with a dedicated server. Overall, though, it’s not difficult to cut down on your initial costs if needed.

Flexibility

Since your reselling business works through the web, you don’t need to meet with clients nor be tied down to a physical office. You can work from home, work on the go, and even work in your pajamas.

So What’s the Catch?

As good as all of that might sound, reseller hosting does come with a number of risks and disadvantages that you should take into account.

Fierce Competition

First and perhaps most important? The sheer breadth of the hosting industry. If you’re taking on reselling as your main business rather than as a complementary product, you’ll be in direct competition with literally thousands of providers out there. Unless you offer unique services that help you stand out from the crowd, you run the risk of getting lost in a sea of hosting providers.

Low Profit Margins

This isn’t always the case, but with most hosting providers offering rock-bottom prices to appeal to customers, you’ll likely find yourself having to do the same just to stay in the game. That means you’ll earn a pittance per client, so unless you really rake in those accounts, you might not earn all that much.

Some Expertise Required

Not all reseller hosting companies will give direct technical support to your clients–and even if they do, it’s still best to know the technical details of your hosting service. If you go the VPS or dedicated server route, especially, expect to take up most of the customer support slack. If you’re not comfortable managing hosting accounts, troubleshooting server issues, and so on, you might want to reconsider.

Little Control over Your Time

While reseller hosting affords you a great degree of flexibility, remember that a lot of your business depends on other people. Web hosting is a 24/7 service, and downtime doesn’t just happen on a schedule. Expect to field requests, calls, or even more mundane questions from your clients at all hours of the day–especially if you’re catering to clients from different time zones, too. Web hosting doesn’t know off-hours or holidays, and if you want to be a reseller, you’ll just have to live with that, too.

Conclusion

There’s a tidy profit to be made in reseller hosting, and in some ways, you’ll have an easier time than you’d have had with a different venture. As with any fledgling business, though, reselling still requires tons of elbow grease and gumption. Reseller hosting services like the ones in our Top Ten list are around to help make things easier for you, but ultimately, the success of your reselling business is in your hands. After all, it’s a wide and wild web hosting world out there. If you want to make it as a reseller, it’s best to go in with open eyes and a good idea of the benefits and costs.