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Thread: hosting plans

  1. #1

    hosting plans

    need some advice

    are these good plans for a hosting company to offer?
    ----------------------------------------
    PLAN 1
    ----------------------------------------
    50GB BANDWIDTH
    1GB SPACE
    ----------------------------------------
    TOTAL: $14.95/MONTHLY
    ----------------------------------------
    ----------------------------------------
    PLAN 2
    ----------------------------------------
    75GB BANDWIDTH
    2GB SPACE
    ----------------------------------------
    TOTAL: $19.95/MONTHLY
    ----------------------------------------
    ----------------------------------------
    PLAN 3
    ----------------------------------------
    100GB BANDWIDTH
    4GB SPACE
    ----------------------------------------
    TOTAL: $24.95/MONTHLY
    ----------------------------------------
    one of my friends was starting a hosting business and was curious if that would be boasting too much or is it around the "right price" for a good host. He has no idea about the prices and neither do i, so, i decided to ask you guys....

    sorry, i'm fairly new to this forum, please forgive me if this is in the wrong area, if it is, could one of the mods please move it?

    any advice/comments are welcome

  2. #2
    Join Date
    Mar 2004
    Location
    Edmonton, Canada
    Posts
    339
    prices are fine, but may a suggest a Plan 0.5?
    Most sites really don't need that much resources
    laslo.ca
    Quality Canadian Web Hosting

  3. #3
    really?
    go ahead, give me an example plan 5

    thanks for the help
    very much appreciated...

  4. #4
    Who are you targeting? If you are mainly targeting the general online community you might want to think about including another plan for <$14.95/mth. I'm sure you will get sales at that price, it's simply that you price a lot of people out of your market by starting there.

    But if you're targeting business or the offline crowd.....these prices seem quite reasonable

  5. #5
    Join Date
    Mar 2004
    Location
    Edmonton, Canada
    Posts
    339
    something along the lines of

    300mb space
    10gb transfer
    for $8.95 or similar
    laslo.ca
    Quality Canadian Web Hosting

  6. #6
    Originally posted by robdavy
    something along the lines of

    300mb space
    10gb transfer
    for $8.95 or similar
    Agreed!

  7. #7
    Originally posted by robdavy
    something along the lines of

    300mb space
    10gb transfer
    for $8.95 or similar
    I'm curious, and have a few questions.

    How do you know if that is a profitable number for him?
    How did you arrive at that figure?
    Did you calculate more than just a server cost in there?
    What are his costs?
    What are his business expenses?
    What profit margins are being achieved?
    What is the advertising budget?
    How does that affect his plan pricing?

    I could go on and on here but I think I made my point. Despite the well meaning suggestions thus far in this thread, there is only one individual that would have all the answers to all the questions it takes to set up a pricing strategy...

  8. #8
    Originally posted by Watcher_TVI
    I'm curious, and have a few questions.

    How do you know if that is a profitable number for him?
    How did you arrive at that figure?
    Did you calculate more than just a server cost in there?
    What are his costs?
    What are his business expenses?
    What profit margins are being achieved?
    What is the advertising budget?
    How does that affect his plan pricing?

    I could go on and on here but I think I made my point. Despite the well meaning suggestions thus far in this thread, there is only one individual that would have all the answers to all the questions it takes to set up a pricing strategy...

    I can't speak for robdavy, but the reason I was in agreeance with his post was the based on the thread starters cost model(1GB/50GB for $14.95 etc). From that, I agreed that this lower resource plan would indeed be viable. Of course, there were are all sorts of assumptions made. However when it comes down to it, it was only a recommendation.

  9. #9
    100GB BANDWIDTH
    4GB SPACE
    ----------------------------------------
    TOTAL: $24.95/MONTHLY

    if you have 1000GB on a server
    you only can provide 10 people
    means 10 * 24.95 = 249.50
    server cost around -160
    other applications (billing, helpdesk, forum): -40

    249.5 - 200 = $50.50 profit / month

  10. #10
    Originally posted by shraz
    100GB BANDWIDTH
    4GB SPACE
    ----------------------------------------
    TOTAL: $24.95/MONTHLY

    if you have 1000GB on a server
    you only can provide 10 people
    means 10 * 24.95 = 249.50
    server cost around -160
    other applications (billing, helpdesk, forum): -40

    249.5 - 200 = $50.50 profit / month
    $40 a month profit?
    What about taxes?
    How about support?
    Who is being paid for that?
    What about your disaster recovery plan, how much does that cost?
    How about credit card processing fees?
    Still think you would make $40 a month profit?


    @Professor,
    I can understand where you were headed, you had even asked a few questions in your first post in an attempt to clarify.

    What I still cannot understand is how so many people can come out and add 3-4 numbers together and then think they have a viable pricing strategy. It happens all the time and then in 3 months you see the same people wondering why they cannot make ends meet and having to close their doors.

    One of the most important aspects of any business is knowing all your costs. Cash flow may cover up a lack of profit for a time, but sooner or later the rubber does meet the road...

  11. #11
    shraz, indeed the resources you mention would not make it viable, but his plans do seem to indicate some level of overselling.

  12. #12
    Join Date
    Mar 2004
    Location
    Edmonton, Canada
    Posts
    339
    Everyone knows that those 10 users aren't going to use 100gb each.
    The airline industry has been doing it for years (overselling)
    laslo.ca
    Quality Canadian Web Hosting

  13. #13
    lets take the plan 3 for an example:
    100Gb bandwidth & 4 GB Space
    $24.95/client
    -------------------------------
    server specs:
    1000Gb bandwidth
    80gb hard drive
    -------------------------------
    bandwidth:
    1000gb / 100gb = 10 clients per server
    10*24.95 = $249.50
    $249.50-$119(server) = $130.5
    space:
    10 clients *4Gb space each = 40gb space used 40gb left
    -whm autopilot license has already been bought
    -helpdeks software could be the whm autopilot integrated help desk or the http://www.helpcenterlive.com's (free)
    -he said credit card processing would be handles through paypal for the 1st month to reduce costs, however he can still choose mypaysystems.com and not pay any monthly fees (meerly a $49 setup fee...)

    providing these circumstances i still see the point you're trying to make, watcher_tvi, and i'll tell him to make the 1st plan similar to what robdavy said...

  14. #14
    true....

  15. #15
    You're just not being thorough jubinrr, please don't take it personally. No matter what processor you use there are still fees involved ranging from 2-7% of the transaction along with a transaction fee of anywhere from .10-.75. This is just one aspect of your payment processing. You still have another couple dozen aspects to scrutinize before you can establish your costs.

    Best of luck with your venture....

  16. #16
    mmm..... true

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