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  1. #1
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    Closing a reseller account, what to do with the customers?

    Hi,

    I am about to close a reseller account. This guy didn't pay the hosting plan and doesn't reply to our emails.

    But under this reseller account, there is 5 or 6 user accounts. These people paid a year in advance and deserve to be hosted for their money.

    What can I do? Close all accounts? Contact the final users and find any solution with them? Resell the reseller account with its customers?
    .:. Enterprise SAN Consultant .:.

  2. #2
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    You can't exactly sell HIS customers. On the other hand, this is pretty cruddy but I don't think you really can do anything. To be honest I would personally love to contact them and offer a way out / hosting etc, but that's because I hate to see people get ripped off.
    Automated Tendencies - Brand Management Agency from Baltimore, Maryland.
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  3. #3
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    In fact, I am not just intersted to have 5 or 6 more customers, but these people will be ripped off if I close their account without any chance.
    .:. Enterprise SAN Consultant .:.

  4. #4
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    Yeah, but the fact is the person they paid took the money and dropped it, it's not like you can refund them (except out of your own pocket). That is pretty messed up though. I mean are they on big packages like 1 GB + and all? If not you may be able to set something up (without losing much in the process).
    Automated Tendencies - Brand Management Agency from Baltimore, Maryland.
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  5. #5
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    This happened to me once. However in my case it was much worse. The guy was reselling reseller packages.
    After 2 months of non payment and no reply to emails, i contacted all his resellers. I suspended all the accounts shortly after.

    They had been paying hardly anything for a lot. I had sympathy, but not enough to offer anything free. People need to learn they really do get what they pay for. No exceptions.

    I offered them to either switch to my company and pay my prices, or switch to a different one. Some accepted and stayed and find it kind of refreshing to receive quality service, others continued to search for unlimited bandwidth and webspace hosts.

    You should offer them a way out, but you need to understand that this is business, and a very competitive one. Although you have your clients best interests, the clients of another host are not your responsibility. People need to research and spend time to find a decent reliable host with proven history.
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  6. #6
    If they are paying ok money, then i'd host them for free until their term is up, and then keep them

  7. #7
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    edelweisshosting will you keep us updated on the situation? I'm wondering how it works out (if you don't want to post but don't mind telling, feel free to PM )
    Automated Tendencies - Brand Management Agency from Baltimore, Maryland.
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  8. #8
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    Thank you for your concern :-)

    I sent a last email to the reseller. He has 24 hours to contact me, then, I will close his reseller account.

    For the customers, if the reseller doens't reply, I will contact them all to explain the situation. They can opt for our service or choose any other company. I will give them, say 1 week to decide.

    As stealthdevil explained, these customers must accept our rules. The reseller sold account with "unlimited bandwith". I don't how a reseller with 50 Gb of monthly bandwith can sell unlimited bandwith accounts.

    This is the first time I have to close a reseller account with users on it. I will keep you updated :-)
    .:. Enterprise SAN Consultant .:.

  9. #9
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    Unlimited bandwidth? I can't wait to see that person's response! Hehe!!
    Automated Tendencies - Brand Management Agency from Baltimore, Maryland.
    Reputation Management Search Engine Optimization Pay Per Click Email Marketing

  10. #10
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    Thats tough, but it was his fault not yours, so you shouldnt feel bad at all.

  11. #11
    anoying :\ i hate that when it happens this ppes think they can do what ever they want

  12. #12
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    Two things.

    1. There may be some legal issues with getting in contact with the reseller's customers.

    2. How could he sell accounts with unlimited bandwidth unless you enabled him to do that?

  13. #13
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    2. How could he sell accounts with unlimited bandwidth unless you enabled him to do that?
    I don't allow resellers to sell unlimited bandwith, but they can promote whatever they want on their websites. The basic plan comes with 50 Gb monthly bandwith and they all know about it. I contact the reseller when he used 80 % of his allocated bandwith except if we are at the end on the month. The bandwith excess is billed, or the account suspended to the next month.

    However, I allow over selling. Todays panels doesn't integrate an overselling factor. But that could be a great addition. Example: you allow a reseller 300% overselling but no more.
    .:. Enterprise SAN Consultant .:.

  14. #14
    but remember u are not allowd to access his folders unless you ask him or when you sold it to him your informed him

  15. #15
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    These situations are nasty...

    Last time i had a similar situation was closing an server, 3 months of non-payment.

    Well, some of their clients called themselves to me about it.

    What i did was that i just suspended the server, tried contacting that client again, etc.

    i didn't even myself know anything about their clientbase, before their clients started calling me for answers & solutions.
    Pulsed Media: Seedbox hosting and Dedicated Servers for content distribution

  16. #16
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    I would suspend all of the accounts and give them a email address to contact for more information about why their account is suspended.

    a) maybe they will have better luck contacting him to ask why he suspended them.
    b) maybe suspending his customers will get his attention.
    c) once you explain why their accounts were suspended, you can offer to let them move to your server
    Scott Swezey
    TCL Fasteners, Inc.
    Automotive fasteners for collision shops.

  17. #17
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    Chatsworth, CA
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    Make an offer

    Here is what I would do. I would send out an email explaining to the customers the truth of the situation. Our of courtesy, I would give them 3 days notice so that they can find another host. I would give them the option of staying with you under one of your plans. I would tell them that they can take legal action against the person who sold them their packages.

    A reseller is basically like a sub-leasor of property. If you do your contract right, the sub-lesee's (resellers customers), are not in privity of contract with you, therefore, you would not be legally liable to them. It's all in the contract. If your contract with the reseller is not specific on this fact, you could possibly be sued.

    An owner of property can evict sub-lesee's if the sub-leasor does not pay because the sub-lesee is not in privity of contract with the owner. You are in the same situation.

    However, giving them notice is the key!!

    Good luck!
    Norm
    www.iHostKing.com/
    Internet Hosting & Design

  18. #18
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    edelweisshosting, did this client ever pay?

    BTW is it only me or do others have trouble accessing your website too? It redirects me to SSL when I want to access the website and the presents me with an untrusted certificate. Don't you think you're losing lots of customers because of that?

  19. #19
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    Whilst you may feel sorry for the end users in a situation like this, your contract is with the reseller. If they don't pay then, unfortunate as it might be for the end user, you should suspend the reseller and their accounts.

    I think contacting a resellers clients, for whatever reason no matter how good the intentions, is the wrong thing to do if you provide anonymous reseller hosting.

  20. #20
    Did you try and contact him through via phone? Of course it is not your responsibility to these clients, but with resellers, you are talking about innocent parties.

    As some have mentioned, you really should get in contact with them "before" you suspend the accounts.

    Contrary to the belief around here, I have talked to a lot of my clients regarding unlimited space and bandwidth(no, I don't offer it), and they see it in a similar way to the offerings of ISP's. Most ISPs offer some sort of unlimited plans, and the assumption is that this extends to hosting as well. Of course, us well versed in the industry understand the distinction, but most don't.

    My point. Don't penalise them because they believed the "could" get unlimited space or transfer through this dodgy host.
    Ovica.com : Web Hosting Is What We Do!

  21. #21
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    How about suspending the reseller account and its hosted sites and placing a temporary page on the reseller's index stating that the site is temporarily unavailable, if you have any questions please contact [email protected] (your contact information, of course)? This way if the end users find their site down and try to go to their host's site (the reseller) they'll find your note and perhaps contact you, at which time you can explain the situation, at least as much of it as your privacy policy allows.

    You wouldn't actively be contacting his customers that way, but at least they wouldn't be left in the dark and might decide to remain as your customer.
    It's time to kick back, pop in a From Autumn to Ashes CD, and relax.....

  22. #22
    Greetings:

    In the past ten years, we've faced this issue twice.

    Legally, ethically, and morally the clients are those of the reseller.

    I'm not sure how your reseller program works; but, most providers try to offer private label reselling even when all of the technology to hide the actual provider is not available.

    If that's the case, directly contacting the clients would post a question to the other resellers as to how sound the policy is for the actual host to contact the clients of the reseller.

    Thank you.
    ---
    Peter M. Abraham
    LinkedIn Profile

  23. #23
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    I would find it extremely unethical to contact one of my resellers customers, no matter how badly I feel about their situation.
    Doyle Lewis
    BuyHTTP Internet Services - In business since 2003
    Business Hosting | nginx, CloudLinux, Varnish cache, and CDP with every business account
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  24. #24
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    Maybe think of something like this... here's what we did when one of our resellers did that. Keep in mind this account was 60 days delinquent (we wern't doing automated billing then, heh) and we really were not sure how we wanted to handle it... though I think this worked pretty well.

    We suspended the reseller's account, and then dropped his sub account's bandwidth limits to 1mb, which gave them the 'bandwidth exceeded' message, but still allowed email to function. They picked up on it after a couple days, and after another week, the domains were no longer pointed to our servers.

    Minimal damage to the innocent parties, no lost data or interrupted email. I think it was just about the fairest way to handle it. It also ment we never made it known who we were, so there was no 'conflict of interest'.
    Jacob - WebOnce Technologies - 30 Day 100% Satisfaction Guarantee - Over 5 Years Going Strong!
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  25. #25
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    Originally posted by WebOnce
    Maybe think of something like this... here's what we did when one of our resellers did that. Keep in mind this account was 60 days delinquent (we wern't doing automated billing then, heh) and we really were not sure how we wanted to handle it... though I think this worked pretty well.

    We suspended the reseller's account, and then dropped his sub account's bandwidth limits to 1mb, which gave them the 'bandwidth exceeded' message, but still allowed email to function. They picked up on it after a couple days, and after another week, the domains were no longer pointed to our servers.

    Minimal damage to the innocent parties, no lost data or interrupted email. I think it was just about the fairest way to handle it. It also ment we never made it known who we were, so there was no 'conflict of interest'.
    That is a great idea.
    Doyle Lewis
    BuyHTTP Internet Services - In business since 2003
    Business Hosting | nginx, CloudLinux, Varnish cache, and CDP with every business account
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  26. #26
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    Also forgot to point out explicitly, that leaves them able to still log into their cPanel, so it was possible for them to have another host just transfer their site.

    Easy, simple, and clean.
    Jacob - WebOnce Technologies - 30 Day 100% Satisfaction Guarantee - Over 5 Years Going Strong!
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  27. #27
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    Well man, it's not your problem, you didn't take those folks' money and then not pay YOUR bills.

    The few times I've had this happen I just tell them they're welcome to signup with hosting from us since it ain't my place to turn away business but we don't make it a habit of going after a reseller's customers.
    Gary Harris - the artist formerly known as Dixiesys
    resident grumpy redneck

  28. #28
    If I were your reseller, and you contacted my clients for ANY reason... I would have my lawyer contact you very quickly.

    The fact that he hasn't paid does NOT give you any rights to contact HIS clients.

    Contact his clients, and you may find yourself on the losing end of a lawsuit when your reseller comes back, decides to pay his bill, and finds you've stolen his customers and business away from him.

    The business reality is that it's too bad for those people... it has NOTHING to do with you. They are NOT your clients.
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  29. #29
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    Any update on this from the OP?
    GotPing Internet
    www.gotping.com

  30. #30
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    how do you know what they prepaid? none of that is your problem, close thier accounts and let the person who sold the accounts deal with it. if you dont pay for your server / bandwidth you will get shutdown and they wont give a *** how many customers you had on there.

  31. #31
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    I have changed my opinion on this subject. I have now come to the conclusion that the legal ramifications of interfering with someone else's customers could be more devistating than the benefits of helping said customers. So long as your contract with the reseller specifically states that you are not liable for their customers and are not in privity of contract with said customers, and that the account will be disconnected for non-payment, I would just go ahead and pull the plug!
    Norm
    www.iHostKing.com/
    Internet Hosting & Design

  32. #32
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    Thank you for your advices. The reseller contacted me and he said that he want to pay! This is not the first time he taked about paying, but this is the last one.

    If he does't pay by the next week, I block his account during few days, then I will delete everything. No contact with the customers will be engaged. At least, from the suspension page, if they are smart enough, they can understand the situation and make a backup for their files.
    .:. Enterprise SAN Consultant .:.

  33. #33
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    make him an offer to buy his customer accounts.

    might be a cheap way to acquire customers (who are already on your server)

  34. #34

    Hello

    Any news till now?
    I am very curious how this will end.

    Ovi

  35. #35
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    I would never contact the customers, reseller doesn't pay, account gets turned off, and if one of his customers signs up with me then that's that, I'm not going to approach them with offers of "help" or anything like that, but if they signup and become paying customers then that's that, I do all I can to segregate it so resellers aren't having to worry about that happening but someone with a clue can easily navigate the segregation and find us, just how it goes.

    But no I wouldn't approach the customers, heavens to betsy no
    Gary Harris - the artist formerly known as Dixiesys
    resident grumpy redneck

  36. #36
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    Sell them,

    Good Luck

  37. #37
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    Originally posted by mrzippy
    If I were your reseller, and you contacted my clients for ANY reason... I would have my lawyer contact you very quickly.

    The fact that he hasn't paid does NOT give you any rights to contact HIS clients.

    Contact his clients, and you may find yourself on the losing end of a lawsuit when your reseller comes back, decides to pay his bill, and finds you've stolen his customers and business away from him.

    The business reality is that it's too bad for those people... it has NOTHING to do with you. They are NOT your clients.
    I've just been thinking about this and I'm not too sure that there would actually be any legal liability if you contacted their clients and offered your services.

    Legally, you only have responsibility to the reseller while the contract is in force, however their failure to pay means they are in breach of contract and because of that the contract may not cover them any more.

    On the other hand though, once you cancel their services if you access their client's account data then you are probably opening yourself up for privacy violations and they would likely be able to sue you for that.

  38. #38
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    I would be careful with just deleting everything. Make sure you have backups in place to avoid legal trouble. The clients might hold you liable in this case.

    Christoph
    Web Hosting Resource Kit - Web Hosting Reviews & Hosting Tutorials

  39. #39
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    The clients of the reseller have no contract with him and he is in no way liable to make sure he has backups of their data.
    Doyle Lewis
    BuyHTTP Internet Services - In business since 2003
    Business Hosting | nginx, CloudLinux, Varnish cache, and CDP with every business account
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  40. #40
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    Originally posted by securehost
    but remember u are not allowd to access his folders unless you ask him or when you sold it to him your informed him
    This doesnt apply in this case. The guy stops paying, he breaks his TOS with the company

    No longer applies

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