Reseller hosting is when a website provider sub-leases servers and networking equipment to third parties. These other parties will then sell portions to those who want to build websites. Essentially, this turns the reseller into a micro-provider.
Reselling has been an active way to make money for several years. As technologies have advanced, so have the types of plans available. However, finding the right plan can be a bit of a pain. After all, the reseller needs to find the best way to get the most out of the plan.
Because reselling accounts are limited by web space and bandwidth, there is a lot that needs to be considered. Features, additions, promoting the business and other aspects all roll into success. This all starts by making sure the right account type is picked from the beginning.
Here are three steps to help determine which is the best plan to use.
Step 1: Develop a Strategy for the Reseller Hosting Account
One mistake many people make when setting up a reseller account is thinking they can attract those looking to build a website through normal channels. For example, paying for advertising in Google about offering website space will pit the reseller against larger companies and even the primary provider. The limitations that are on the reseller make this an extremely difficult plan of action.
There needs to be a strategy for promoting the service other than the usually channels. Because the reseller is still accountable for paying each month, he or she needs customers as quickly as possible. Here are a few examples:
- A WordPress developer who sells websites to local or online clients.
- A website developer who builds up a website to be sold. Then, he or she can offer a low monthly fee for hosting to the buyer.
- A graphic designer who creates digital images and offers websites to customers.
- A business that specializes in temporary website development and promotion.
- A developer who creates websites for walk-in customers or small businesses around town.
The common theme here is finding ways to sell web space without being in direct competition of bigger companies. Some of the best methods include being able to sell these pieces of digital real estate in the physical world.
Developing a strong plan for the reselling business will help guide the next steps. Simply buying into one of these plans without having an idea about how to sell them often leads to tapping out the bank account over time. This also includes advertising the services and finding the perfect target consumer.
Step 2: Determine Drive Space and Bandwidth Needs
The most important aspect to consider is space and bandwidth when it comes to reseller accounts. Different plans come with varying abilities for both of these, and they will be used to determine how many clients are possible. Then, this needs to be weighed against the cost of reselling.
Confused yet? It works like this.
Perhaps a reseller pays $20 for 50GB of web space and 500GB of bandwidth. Now, the reseller partitions out that account to create sub-accounts to sell to others. For this example, the individual decides to create enough for 20 different websites. That means each partition is 2.5GB of space and 25GB of bandwidth. In reality, this is quite a bit for small websites.
Then, the seller decides to sell off those partitions for $5 each per month. At most, he or she will make $100 in sales, but only put $80 in the bank because it costs $20 to keep the reseller account active. Because $80 per month really isn’t a lot of money, many will add other services to enhance the income.
This was only a simple example of how others make money through a reseller program. The partitions and pricing are completely up to the reseller. However, there are a few key elements that will come into play such as:
- Offering too little space for too much money will make the offer look unattractive.
- Marketing the service to the right target consumer base.
- Being able to accommodate the needs of that consumer.
Having a set business plan from step one will help determine which plan is the most cost-efficient in terms of space and bandwidth. For instance, marketing to bloggers allows the account to be partitioned even further because most blogs will never come close to using 2.5GB of space or 25GB of monthly bandwidth.
Step 3: Comparing the Best Additional Features
Space and bandwidth are only part of the process. It’s the additional features that will help reel in those consumers. Things like offering cPanel, unlimited email accounts and FTP access are only a few of the things that can sweeten the pot. However, not all reseller programs have these features.
Comparing reseller providers also includes the ability to include white label platforms. This means that a reseller account can be changed to display a seller’s own logo and information rather than the actual provider. It would be like advertising to customers where they could buy Internet space wholesale instead of giving the reseller money to host the site.
There may also be times when certain additional features are not part of the deal. For instance, adding the ability to install the Magento shopping cart might not be part of the plan when marketing to those interested in using WordPress only. This means services such as software installs wouldn’t play into finding the right hosting plan for the reseller.
Last, but definitely not least, is the billing system. A reseller needs a way to track clients and accept payments. Otherwise, he or she will have to design this part of the process or use a third-party. Many reseller providers include latest software for tracking these kinds of payments, and it should be part of the decision making when a seller decides to use a particular web host.
Investing in reseller hosting has potential to be quite lucrative. However, this success will begin with choosing the right provider for specific needs. Keep in mind that there is more involved than just cost versus space and bandwidth. Features and benefits need to be weighed as well to attract clients.