Web Hosting Talk : Web Hosting Main Forums : Reseller Hosting : Profit Margins of Reselling Windows Hosting Plans

[rocco]

Here's a sample reseller plan from one host:

$19.99 / month
1000Mb disk space
20 GB data transfer
Host 50 domains
...

Most other reseller plans I've seen don't offer much disk space / bandwidth for this price..

If I were to resell under this plan and try to make any money, lets say I hosted 10 domains. This means I'd have to offer a maximum of 100Mb and 2 GB data transfer monthly for each shared plan. However, most shared plans I see will offer at least 1 GB of space, 10 GB transfers. How is this possible? I'm aware there is overselling going on, but not in such proportions!

[BW-Tim]

If you find a niche market you'll be able to charge more, and you'll be surprised at how much some people oversell

That's quite an expensive plan though

[cartika-andrew]

I dont think that is expensive - as long as the service is of a premium nature...

If you are trying to sell hosting based on price - then you can never do so with a reseller package... If you really want to get into the price game - buy yourself ALOT of infrastructure, colocate it at a good data center - make sure you are using shared storage arrays, etc - and even though you still wont be the cheapest - you will be alot closer to it...

Honestly - reseller packages are not meant to sell commodity hosting - and anyone who is trying to do it off of a reseller package is either overselling or their provider is overselling - or of course - the most fatal situation - everyone is overselling....

Reseller packages are "truely" meant for people offering value added services on top of hosting. Designers, Developers, Consultants, etc... In which case, the packages they sell and the ultimate pricing they receive for space and bandwith really mean nothing - their primary concern is having a stable, managed environment and a way for them to create hosting accounts and host their clients sites/associated services...

[rocco]

That is what I suspected, and my intent is really to provide value added services. But at the same time I want to be able to provide my clients comparable plans without incurring their costs. If I tell my customer that it will cost them $15 for hosting, I think they should receive the same amount of disk space / bandwidth as someone who would sign up for shared plan, and this would not be possible looking back at the plan I quoted above.

[cartika-andrew]

Hi Rocco,

I guess it depends on what you are actually selling - as far as the hosting portion goes, I am not certain this is a valid argument...

If I tell my customer that it will cost them $15 for hosting, I think they should receive the same amount of disk space / bandwidth as someone who would sign up for shared plan, and this would not be possible looking back at the plan I quoted above.

Heck, our shared hosting plans are pretty small - and again - we would NEVER compete with 20 GB disk space for $15 dollars or whatever. What I am trying to say is that there are many companies selling 10-20 gigs of disk space for less then we sell 150 mb of disk space...

Its all about the customers you are after and there is no "normal" amount that $15 would buy you....

[CyberHostPro]

there are many companies selling 10-20 gigs of disk space for less then we sell 150 mb of disk space...

That’s the difference between quality & quantity



the guys who offer these silly high disk space hosts will eventually just disappear!

[Yash-JH]

There is a market for everyone. Whether you are an overseller or a smart seller It just seems to me smart sellers end up to being more successful
Whatever you have, work out the best strategy to sell your product.. tie in value services and support.. and you could have a pretty good business there

As you grow and gain confidence, you could consider offering packages to a wider section of the market. This is what I've seen alot of resellers do.

[Shaw Networks]

That plan won't sell if you're planning to sell to advertise mainly to WHT and other similar online locations. With prices like that you'll have more success marketing it as a premeire service plan and through other advertising venues (AdWords, local print, etc.)

[ldcdc]

CartikaHosting says it true. Past is the time when reseller hosting was bulk hosting and one could take on the budget hosting market off a reseller account.

Numbers matter much here on WHT, and on hosting directories. However, real people in real life know little or nothing about hosting/web/scripts/html etc. They need a company to take care of their web presence with all that it means.

In other words, it's very much a matter of who you market to, and how you redefine "hosting" in order to create your own niche.

the guys who offer these silly high disk space hosts will eventually just disappear!

If you're talking about those doing it off reseller accounts, you may be right. I doubt we'll see the end of 1and1 or other suhc hosts soon though.

[SynergyWorks]

The profit margins you will be able to make will depend not only on your audiance, but also the cost you yourself. If your renting a dedicated server for example, your profit margin would be alot lower than a host with their own racks and/or network.

If your heading for a "make it big"... you may find better return colo'ing your own servers, or taking out a rack and some transit. Depends entirely on your audiance and targets.