Web Hosting Talk : Web Hosting Main Forums : Running a Web Hosting Business : New to reselling, advice please :)

New to reselling, advice please

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Warning, long read with terrible grammar and math
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Hey guys, im completely new to reselling so i apolagise if i ask some really stupid questions.
Ive always been into web design and webhosting but never really took it any further than a side hobbie. I now would like to take that step further, learn more about webhosting and hopefully setup my own web hosting buisness. I dont expect to make big bucks, hell even a few pounds profit or a break even would be more than enough to keep me happy and occupied. I know the simple stuff, it takes months to even get off the ground and it could just not hit off, i understand that. What i dont understand is how are small time resellers supposed to make profit when the big time companys offer better deals for less?
Heres an example:
hostgator offers 'unlimited' disk space and 'unlimited' bandwidth for $4.95/pm. I realise theres no such thing as unlimited but not every potential customer will know this and even if they did, this 'unlimited' offer is going to greatly surpass what i can offer.
I was considering getting the Reseller hosting package from them, with this i get 250gb Bandwidth + 24gb disk space for $24.95. I worked out roughly
1gb Bandwidth = 0.064p
1gb diskspace = 0.668p
I made a draft idea of a 'basic account'
-------------
Basic Account
-------------
10gb bandwidth
1gb disk space
3.99/pm
Cost to host in units: £0.654
Their Bill: £3.99/pm
Profit: £3.336
I thought that this was actually i nice deal for any small time buisnesses who want a basic website which will fulfill their needs. But i look at what gator has to offer and it completly blows me out of the water. Is £3 too much profit? Am i aiming too high? Do i aim for 10p ? 20p ? I realise they can offer for dirt cheap because they have so many customers that if they make 10p profit per customer they are still raking in thousands.
So my question is, how do honest resellers (no overselling) make money from this? Is it all about advertisment and getting the right clients? Do i have to look for first time buyers who do not know any better?
I apolagise for the long thread and no doubt my math is awful and so is my grammar, ive probably also put this in the wrong section and broken many rules, sorry in advance for that !

hi
sorry i can't comment on your question,but it sounds like a good deal,
regards

[ReadyRick]

Hi Cookie1988,
First off, welcome to WebHostingTalk.
Quote:


So my question is, how do honest resellers (no overselling) make money from this? Is it all about advertisement and getting the right clients? Do i have to look for first time buyers who do not know any better?


Yes, it's all about getting the right clients. HostGator is targeting a global consumer. Think locally. HostGator probably doesn't have agents on the ground where you are. Own the website hosting industry in your community. HostGator can never compete with that!
But it's not just about locally. What are you interests? Are you a blogger? Drive the traffic that comes to your blog to your companies website. Are you active on any special interest forums like gaming, pets, politics, etc? Add a link to your site in your signature. Become the hosting expert in that community.
Also, consider checking out the "Running a Website Hosting Company" forum. You'll find lots of tips and tricks to help you get started.
Again, welcome to WHT! We're glad you're here.





__________________:: ReadyWire Multimedia Solutions - Now offering Master WHMReseller

[ldcdc]

Quote:


Is it all about advertisment and getting the right clients? Do i have to look for first time buyers who do not know any better?


You need to stop thinking you're selling numbers, and focus more on selling a service. Add something special to the hosting offer. Focus on say... fashion model websites, or any other area that you're already decently interested in, know and feel. Address their special needs (you could partner with a web designer for that), and take care of their "website problem" for them, from A to Z.





__________________1. My list of "Honest Hosts"
2. Hosting Coupons

Thank you for the replies so far !
I was only really thinking in numbers because that ofcourse is a big importance to having a sucsessful buisness, but aslong as i have the math right, i realise now that its obvious i cant compete with such hosts like gator and so on but to keep to my interests and hobbies as Rick said. Unfortunatly for me i lack in that department (thus making a hobbie out of this ) lol
What would be ideal is that i get a few clients and i break even, i dont really need to make a profit i just want to have a hobbie that doesnt cost much and is sucsesful, if i break even and end up with bandwidth at the end of the month then i consider that as a succsess another reason why numbers mean alot for me.
When it comes to 'offering a service' what would you suggest? I really dont have much to offer other than what id be doing with the reseller hosting, which in itself is a service but that doesnt really count :/
Another question, considering numbers again sorry. I see alot of resellers reselling for cheaper prices than what i would pay for on gator, would that be because they are more advanced and have their own server and therefor cut out the middle man and host it themselevs and therefor can give for cheaper. (This question come about by checking your website Rick)

[ReadyRick]

Quote:



Originally Posted by Cookie1988


Another question, considering numbers again sorry. I see alot of resellers reselling for cheaper prices than what i would pay for on gator, would that be because they are more advanced and have their own server and therefor cut out the middle man and host it themselevs and therefor can give for cheaper. (This question come about by checking your website Rick)


It's hard to say without asking the individual host. Cutting out the middle man can be one way to bring down costs, then again you have to have some sort of volume to be able to do so.





__________________:: ReadyWire Multimedia Solutions - Now offering Master WHMReseller

[Manageandsupport_com]

Quote:



Originally Posted by Cookie1988


======================================================
Warning, long read with terrible grammar and math
======================================================
Hey guys, im completely new to reselling so i apolagise if i ask some really stupid questions.
Ive always been into web design and webhosting but never really took it any further than a side hobbie. I now would like to take that step further, learn more about webhosting and hopefully setup my own web hosting buisness. I dont expect to make big bucks, hell even a few pounds profit or a break even would be more than enough to keep me happy and occupied. I know the simple stuff, it takes months to even get off the ground and it could just not hit off, i understand that. What i dont understand is how are small time resellers supposed to make profit when the big time companys offer better deals for less?
Heres an example:
hostgator offers 'unlimited' disk space and 'unlimited' bandwidth for $4.95/pm. I realise theres no such thing as unlimited but not every potential customer will know this and even if they did, this 'unlimited' offer is going to greatly surpass what i can offer.
I was considering getting the Reseller hosting package from them, with this i get 250gb Bandwidth + 24gb disk space for $24.95. I worked out roughly
1gb Bandwidth = 0.064p
1gb diskspace = 0.668p
I made a draft idea of a 'basic account'
-------------
Basic Account
-------------
10gb bandwidth
1gb disk space
3.99/pm
Cost to host in units: £0.654
Their Bill: £3.99/pm
Profit: £3.336
I thought that this was actually i nice deal for any small time buisnesses who want a basic website which will fulfill their needs. But i look at what gator has to offer and it completly blows me out of the water. Is £3 too much profit? Am i aiming too high? Do i aim for 10p ? 20p ? I realise they can offer for dirt cheap because they have so many customers that if they make 10p profit per customer they are still raking in thousands.
So my question is, how do honest resellers (no overselling) make money from this? Is it all about advertisment and getting the right clients? Do i have to look for first time buyers who do not know any better?
I apolagise for the long thread and no doubt my math is awful and so is my grammar, ive probably also put this in the wrong section and broken many rules, sorry in advance for that !


You should also decide which market you will target. I wouldd recommend that you try targetting your local market where you will be able to charge people little higher fees and therefore increase your profits than trying to compete with big companies.





__________________Server Management + Support to your hosting clients (unlimited tickets and servers) in one monthly fee.Outsourced Support | ManageAndSupport.com (I am the newest staff member there!!)

[inogenius]

Quote:



Originally Posted by Cookie1988


I was only really thinking in numbers because that ofcourse is a big importance to having a sucsessful buisness, but aslong as i have the math right, i realise now that its obvious i cant compete with such hosts like gator and so on but to keep to my interests and hobbies as Rick said. Unfortunatly for me i lack in that department (thus making a hobbie out of this )


Something to consider is that your hobby may be supporting someone's livelihood, or a hobby they're truly committed to.

[mrzippy]

The first thing you need to do is NOT set your pricing and plans. This is the wrong way to go about creating a business, and you will surely fail if you are simply looking at prices alone. There are literally thousands of other hosts that are cheaper then you will ever be.. even if you sell your hosting for $1/year. (There are free hosts!)
The first thing you need to do, to establish a successful business, is determine what is your product and market. What is your unique selling point? What makes you different then every other host? Whom are you selling to? Why would they buy YOUR service instead of the other guy who is $1 less expensive?
When you can answer those questions in a realistic way.. then you can begin to set your pricing and your plans.
My advice is to target your local business market. There is a lot of demand for high quality web hosts who deliver *personal* support and service. You can charge a lot of money for this, too.
Good luck!





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