Web Hosting Talk : Web Hosting Main Forums : Running a Web Hosting Business : Formula for recovering cost of leased hardware

[systame]

For those of you that lease servers, just wondering how quickly you try to recover the cost? 18, 24, 36 months?

I'm guessing if you try to recover too quickly it'd make more sense for the client to buy. Too slowly and the hardware becomes obsolete.

[bqinternet]

We like to shoot for 6-12 months.

[amc-james]

4 months here.

[boonchuan]

For us it is about 12 to 18 months.

[systame]

So, for a leased server would you calculate the price to the customer like this for 18 months:

` server cost / 18
+ bandwidth cost per month
+ rackspace cost per month
+ profit
------
= price

And what percentage markup for profit over cost would you suggest?

Would you increase the recovery period for higher-cost gear.