When you offer hosting services to clients of your own, whether than be as part of a larger, packaged service such as website maintenance, or as a stand-alone product, you may wonder what the best way to go about it is.
There are a few factors that come into this decision, including:
- The cost of which hosting service you will purchase to resell.
- The performance capabilities/resources of the hosting services you will be offering.
- The margin you may add to create a profit.
You generally have 2 or 3 main options on how to go about reselling hosting services, though one of these options is not typically feasible when you’re first starting out. These options include:
- Purchasing reseller hosting, and reselling individual accounts from this service to your own clients.
- Purchasing individual shared hosting accounts, and reselling them to your own clients.
- Purchasing VPS or dedicated server hosting, and reselling individual accounts from this service to your own clients.
With these possible options in mind, let’s look at each of the above factors in greater detail.
The cost of which hosting service you will purchase to resell.
Each of the above options jumps up in cost, but become potentially more profitable as well. Reseller hosting is very low cost but comes with limited resources that can be shared between your clients. Individual shared hosting accounts are a little more expensive, but allow your clients to have greater resources/performance as needed. Finally, VPS or dedicated server hosting allows you to create a large number of individual hosting accounts on your very own server, with your chosen resource limits. Despite being the most expensive option, with enough clients, this option can actually also be the most profitable for you as the reseller. It’s not usually suitable for resellers who are just starting out, however.
The performance capabilities/resources of the hosting services you will be offering.
Reseller hosting is best suited for low-medium traffic websites and those that do not have heavy resource requirements. Individual shared hosting accounts are the next jump up, allowing you to purchase higher levels of resources for busier or heavier websites. Lastly, VPS or dedicated server hosting allows you to offer your clients very high-level resources, or, will give you the ability to host a very large number of smaller clients all on the one service.
The margin you may add to create a profit.
You will probably find that it is easier to build in a profit margin for yourself at the low-end option (reseller hosting), and the high-end option (VPS or dedicated server hosting), but not so much for the mid-range option (individual shared hosting accounts). This is because the low and high-end options are singular services which you will be splitting between multiple clients. Comparatively, individual shared hosting accounts can only ever serve 1 client each.
Conclusion
There is no one correct answer to fit everyone’s unique circumstances. It really depends on how many clients you are looking after, and what sort of websites they have.
If you’re just starting out, or your clients have mostly low-mid level traffic websites…
Your best option may be to purchase reseller hosting, and resell individual accounts from this service to your own clients. This is the most low-cost option for you as the reseller and will provide adequate performance for clients with low-mid level traffic websites. If you have one or two clients who need a more heavy-duty hosting service than what your reseller plan can provide, you can always just purchase individual shared hosting accounts, VPS or dedicated server hosting just for those clients who need it and charge them accordingly for the upgrade.
If you’re fairly established, or your clients have mostly quite busy websites…
Your best option may be to start purchasing individual shared hosting accounts, and resell them to your clients. This will keep your costs still reasonably low but allows you to provide your clients with a higher level of performance/resources.
If you’re managing a large number of clients, or your clients have mostly high traffic websites…
Your best option may be to purchase VPS or dedicated server hosting and resell individual accounts from this service to your own clients. If you have a high number of clients, or just need a high level of resources to serve your clients, this could ultimately be a much cheaper way to structure your services. VPS and dedicated server hosting plans allow you to create large numbers of individual hosting accounts, as well as control the specific resources each of those accounts is entitled to use. With the right number of clients, you could easily find this the most profitable option of them all, but it generally does take some time to build up to.
That’s it from us! As always, if you have any questions about this post or our shared hosting, VPS, reseller or dedicated server plans, simply call us on 1300 MY HOST (694 678) during business hours, or submit a ticket through our Support Portal and one of the crew will be in touch!
