Hey everybody, i will soon be starting a webhosting business of my own. I wanted to which plans will sell the fastest, so i can figure out a business plan :)

Here are the possible plans

Price - Space - Bandwidth
$1 - 50mb, 500mb
$3 - 100mb, 1gb
$5 - 200mb, 3gb
$10 - 500mb, 10gb
$15 - 1gb, 30gb
$30 - 5gb, 100gb

All the plans will have cpanel, php, ssl, cgi etc etc.

So my question is, if you MUST buy a package from me, which will you choose?

Thanks! also post here any other advice you have :)

Chengo

Is this a serious question? Judging by the first 3 accounts it's hard to tell if it's a joke or not.

Honestly speaking, space and bandwidth should be the last thing on your mind when you're determining the profitability of your company.

Judging by your statement of which plans will sell the fastest, it appears that you still need a lot of planning to do if you plan on staying in business for the long-term.

Boris

i just want to know the ratio of the sales of plan. Say 50% will be the lite plan, 40% the medium plan, 10% the premium plan etc.

oh amdac, why do you think this is a joke because of the first 3 accounts? just curious....

How will you accept payment ? 3rd party processor ? if so you will lose $0.55 (approx) per $1 transaction

Are you going to offer support ? How much time can really spend supporting your clients at those prices ?

I understand there is a demand for budget hosting but you might want to consider offering some "extra value" services to attract clients.

The bottom 3 plans are good sizes for hosting clients, my thoughts are that you just need to reconsider your pricing. Start by working out how many of the 100mb accounts you would put onto one server, how much the server costs, support costs etc and then your profit. This should give you a more realistic pricing sheme that would help you to still be in business in a few years time.

i am doing this with 2 others, we are in different timezones, so we will be able to provide pretty good coverage of technical support, when the business gets estabolished, we will hire more technicians to help out. Originally i provided the $1 plans for people who dont know much, people who just want a little homepage for their friends.

Originally posted by chengo
oh amdac, why do you think this is a joke because of the first 3 accounts? just curious....

Deefer covered my questions fairly well. $1 hosting is a joke, $3 hosting a joke. It you want people to respect your company and think you're planning on being in business for more than two months, I'd highly suggest re-evaluating your business plan. $1 for a month of support just doesn't work.

okay thanks amdac, i understand you now perfectly. I never thought of it that way, $1 for a month of support. Anyway i will probably just drop out the bottom 2 plans. I would still like to get some more votes on the last few plans, see which one will sell more, so i can work out a business model.

Chengo

i have a question about overselling, i do not want to oversell to my clients, but it might be neccessary to oversell, if i want to provide hosting at such prices, so i was just wondering what are sum of the bad thing of overselling? I will not oversell, if it in anyway reduces the quality of the hosting for the clients

Chengo

P.S keep those votes coming! :)

Originally posted by chengo
Hey everybody, i will soon be starting a webhosting business of my own. I wanted to which plans will sell the fastest, so i can figure out a business plan :)

chengo, this is not how one starts a company in any industry. Of course an el-cheapo account will 'sell faster'. What happens when you realize you have to raise your prices to but another server to support all those signups? CYA latah, alligatah! Kiss your clients goodbye, or start OVERSELLING to make ends meet.

COGS
Cost Of Goods Sold
Cost Of Services Rendered, in this case. Pricing is NEVER step one. Estimating your operating costs IS. You must get a handle on how much it costs not only to run a server but all the other little overhead items you haven't thought of yet. Please, ask us for help with that, first. Only once you have a reasonable estimate of your costs can you then determine your retail pricing.

Originally posted by chengo
i have a question about overselling, i do not want to oversell to my clients, but it might be neccessary to oversell, if i want to provide hosting at such prices, so i was just wondering what are sum of the bad thing of overselling? I will not oversell, if it in anyway reduces the quality of the hosting for the clients

Chengo

P.S keep those votes coming! :)

Overselling = more clients, less reliable hosting, less income per client. In the end it means you'll be doing more work, offering lower quality hosting, and gaining the same income.

If you feel you need to oversell to generate enough income, perhaps it's the prices that need looking at, not the number of accounts per server.

In response to your original question, the preferred package will depend on your target audience. If you advertise in blog communities, you can expect small packages. If you advertise to businesses, you can expect larger packages.

I suggest you go back to drawing board. Advice given comes from people who are in different stages of web hosting and what is relevant to theirs business is not to yours. Selling cheap is a very expensive in long run.

okay thanks for the advice, so do you think the plans i am offering is too cheap?

I think what everyone is advising you to do is rather than seek advice on a public forum to seriously reconsider your business venture and seek proffesional advice with your business plan if needed.

Then once you have all your costs worked out you shouldn't really need to ask these types of questions.