All you need to know before becoming a hosting reseller

03 December 2018, by

If you are interested in web design or developing, being involved in reseller web hosting is a good way to increase your income, as well as your range of provided services.

This is a field you have probably heard of, and below we will make sure to present it in detail and answer any of your inquiries, in order to help you see the potential in such a decision!

What is a hosting reseller?

Let’s start from the basics. In a nutshell, a hosting reseller rents hosting packages from companies that provide web hosting services at wholesale prices and then resells them to the public.

Reselling is technically and essentially easier than setting up web hosting from the start. However, it requires a basic level of technical knowledge and the ability to offer customer services and support.

You focus on sales and basic support. The company you have selected to provide packages at wholesale prices is responsible for the maintenance of servers, software and bandwidth.

At Top.Host, we do not offer our Resellers just that. We take on the challenge of providing our customers with the fastest hosting experience, along with the privilege of their brand appearing at reseller hosting (rather than ours). In addition, we offer myTophost Backup to all our packages, including those of reseller hosting. This ensures absolute speed and flexibility in Backup & Restore procedures for their files and data bases!

Is it worth it, financially-wise?

If all that sounds like a good idea, then you must be wondering if this is all worth it, financially-wise. The truth is that you determine the reselling price, therefore you choose the profit margin.

Prior to determining the price, it is prudent to take the following into consideration:

  • The price of the package you purchase
  • How many sites you can host through each package, without compromising the quality of your service
  • What is your aim of the hosted sites
  • What is the market’s price range for providing similar services
  • What should be the profit margin, so that your service remains viable

Below, you can have a look at an example of estimating profit:

At Τop.Host, Standard reseller package offers 50GB disk space and 500GB traffic, costing €25/month – 300€/year (+ VAT). There is the option of adding unlimited domains – however limited space of 50GB respectively limits sites.

Let’s assume that 30 sites that have been recently launched, small sized and with limited traffic, can function properly. You can find an average price from the large companies offering web hosting packages, but you cannot really compare to them in terms of competitiveness. Let’s determine an average price for what you offer at €35/year.

For you to cover the package’s purchase cost that stretches to €300/year (+ VAT) and aiming at 30 sites, you must resell at €10/site/year (€300 / 30 = €10). If you resell at the average market price (€35), your profit margin reaches approximately 71%. Your gross profit is €750/year. (turnover: €35 x 30= €1.050, profit: €1.050 – €300 = €750)

In case your customers exceed 30-50, which can be covered by the Standard package, you may instantly proceed to a package upgrade and expand the disk space available. But it’s a good start, till you gather your desired number of customers.

What choices are there in packages?

At Τop.Host, there are two categories for reseller packages, related to the platform used to manage the package.

  1. Plesk Platform Packagestophost_reseller_1
  2. cPanel

These are the ready-made packages that require minimum technical knowledge and guarantee 24/7 Extreme Support from our team, when you need it. You don’t have to be especially knowledgeable when it comes to your customers.

If you have different demands and if you are more knowledgeable, then there are two more options, requiring that you can provide support yourself, when needed:

  1. Dedicated Servers
  2. VPS Hosting

Depending on your type of customers (small sized sites with limited traffic or larger sites with significant traffic) and the type of services you can provide, there are respective packages that cover your needs. Doing some research will help you find the most suitable package for you

In conclusion, before you become a hosting reseller:

  1. Clarify your aim in number and type of customers
  2. Select the most suitable package for you
  3. Do some market research in competitive packages and determine the price/profit margin
  4. Get ready for the services you will need to offer yourself, depending on your selected package
  5. Promote sales, combining packages with the other services you provide

Last but not least

The company you will do business with is a cornerstone, when you begin providing web hosting services. The initial provider that rents space for you to resell is essential. It is important to establish trust and safety every step of the way and feel that way over time. Good support guarantees that, which is why Τop.Host has raised the bar high.

In any new partnership there is a meeting/acquaintance with the company’s people. Here in the digital world we have created the video below, in an attempt for you to come one step closer to Top.Host’s philosophy and values. I encourage you to see it (turn the subtitles on!), so that you meet the people working behind this website! My brother is one of these people, talking about his favorite topic: food.

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