Thread: New Reseller Questions
10-14-2002, 03:56 PM #1Junior Guru Wannabe
- Join Date
- Oct 2002
- San Diego
New Reseller Questions
I have a few questions and quite frankly I am getting very confused the more I search. I am a Systems Administrator, since many people have asked me to do work for them I decided I wanted to start my own side company. I am trying to do this. One of the most recent request I am getting is for web site design. I figured why not try reselling web hosting services to them as well, since most of the sites (about 6 now) are maintained by me. I have been searching these Forums and seem to get a broad range of answers, so I thought I would just ask my questions myself.
1) What does it take to resell? Is there any special licenses I need? Or do I just do this as an individual and report the income as a hobby?
2) I can not seem to find a hosting service that is liked globally. There seem to be a lot out there. I would like to find one that has the best value, quality, and ease of managing of course. Here are a list of ones I have reviewed.
A) PixleSeven - Seems there is some anger against them at the moment, on a previous post.
B) Glypto - http://glypto.com/reselling/index.html
C) Hostmysite.com - http://www.hostmysite.com/web_host.hms
D) Kcdworks.com - http://www.kcdworks.com/services.html
and as pointed out there seems to be a lot of "narrowed down to these last 4" posts but none are the same. Can anybody really help in this area?
I believe taking care of my customers is the number one way to keep them and get new ones, everything I have done till now has been word of mouth advertising. So I need to make sure that I am not going to be screwed over by a hosting company.
3) What are some things I should be thinking about before I commit to doing this? I have the enthusiasm and initiative, capital is not very large at the moment, and that is why I want to make sure I get this right the first time.
10-14-2002, 05:17 PM #2Web Hosting Guru
- Join Date
- Oct 2002
Reselling web hosting services generally is run as any other business. You'll want a business license, and maybe (preferably) some type of corp. LLC's are pretty popular now-a-days. You can do it as a hobby if you keep it strictly to friends/relatives, but you should really "start a business" before venturing further.
Like any business, you need to develop a plan, a budget, think about your "LOS" and what audience you are going after. In terms of a balance sheet, IRS frowns on hobbies. As long as this is a hobby, you'll loose the tax benefits of your expenditures.
Unless your just working for friends, you'll want to be able to accept CC payments. There are several threads on this. While I don't prefer to use paypal, many here do with good success. A merchant account will generally hit you for $25-50.00mo whether you sell anything or not.
Lots of good (and bad I suppose) resellers here at WHT. Read the threads, talk to the resellers and you'll start to get a feel for who works for you.
Being a sysadmin will help you on the technical side. I got stuck with a box 5 years ago, when my reseller quit. I was strong on the unix programming side but didn't know anything about sysadmin. The colo provider coached me along, and now he generally only hears from me when my scripts send him an automated DNS request.
Its a toss up as to whether more folks go under due to bad business, bad support, or lack of technical skills. Technical skills can be developed, but bad support (and I suppose uncorrected bad business) you'll almost never recover from.
Good luck, lots of room for good resellers out there.
10-15-2002, 06:30 AM #3WHT Addict
- Join Date
- Aug 2002
First of all you need to have a target.
If you do not want to expand, not host many domains and you want to have a customer every now and then i 'd advise to keep it as a hobby for a few months and see how things works for you.
But if you think you feel ready to make money and advertise yourself then you need to have all what a company needs. And that includes one or more ppl more (you cannot be online 24h/7d), ded server maybe, more time, and money you could lose.
I cannot tell what a hosting com exactly needs but as a small size reseller to individuals i do like it keeping it as a hobby but do not want to lose my sleep every night. Cause the main point to all these IMHO is not how u get customers (a bit easy if u spend some money to advertisement) but how you can keep them happy (or just keep them, LOL).
And as a conclusion, think it as fishing. You can always sit by the side of a lake and get small fishes every now and then (troll) but you never have enough to sell.
If you wanna get enough then you d probably need a boat to go to the middle of the lake and if you go to the ocean you d probably need a fishing vessel.
(i do not fish anyway)
always chasing the west wind
10-15-2002, 06:32 AM #4Web Hosting Master
- Join Date
- Feb 2002
I think "pickles" has sumed this one up a treatdot5hosting.com
"We look after our customers, or someone else will"
10-15-2002, 06:46 AM #5Junior Guru Wannabe
- Join Date
- Sep 2002
I think this is a very basic and usefull thread for every new resellers (including myself). I was doing a lot of resaerch recently and that is why these questions are quite familiar with me
I don't have a clue about the first question since I don't live in US.
But here is what I think about the others.
2- As some said before in this forum; "everybody has his/her own personal tastes". Some may like a hosting service just because of their friendly help or may just like it's name or may just be fancy of lots of web space they are offering or maybe attracted how their web site looks cool...
I think most of the "narrowed to 4" lists are similar indeed. Just the names are different but all they are offering more or less the same.
I think at this point, this "more or less" becomes important. Some ask for a set-up fee, some don't. Some charge less for extra BW or space some charge higher, some offer 15 days money back guarantie some offer 30 days...
Again someone in the WHT mentioned about the importance of details and I agree. I say if you think you done enough search and have the list. Just compare the details. Send all of them some of your questions and see how fast and helpfull they are. If possible (as pickles said) talk with some of their resellers. Check their forums etc...
But which ever you chose probably you won't regret because the hosts which people are talking about in WHT are usually among the best ones.
I had a "narrowed to 4" list for my own and it's totally different than yours. But I still belive that yours are as good as my picks.
And also I strongly suggest that you sign-up for a month before, keep for 3 months and if you are still happy with them switch to a yearly plan (and get your 2 month free discount then).
3- I say, at the beginning think about the worst.
How much you'll pay for the hosting service? Also add the SSL or merchand account etc... I mean "accepting payment" expenses. Then if you'll hire an extra hand for tech support add this cost too. And taxes. And domain registrations for your new customers (some registrars ask for a set-up fee between $49 to $100). Will you pay for advertising for your services? How much you are going to pay for it? After doing this calculation you'll come up with the fees of $x.
Now you should calculate your prices. What will be your plans and prices? Including for extra BW, space, e-mails and databases etc...
And at the end according to these calculations how many clients you need to make to earn that $x. When do you think you can reach that level? If let's say it looks like that you'll be there in 6 months and if you have a capital that can carry on for 6 months, I say go for it. If not at least you have the financial data in your hand. Whenever you think that your capital is enough for that 6 months or whenever you think that you have a better client potential you can re-consider jumping in the reselling business...
My humble tips
- And always consider buying the lowest plan that fits you. Almost all the hosting services allow you to easily upgrade later on when you need more features.
- It would be a good idea to make your fellow web designers as your affiliate. Like whenever they make a web design they will have a hosting discount from your side. So they will make a little more money and they will be able to all their webs at the same place and deal with only one person. And you'll have a steady growing client number.
Well... these things I found out recently and hope it helps.
Good luck with this business..
10-16-2002, 01:43 AM #6Junior Guru Wannabe
- Join Date
- Oct 2002
- San Diego
WOW, getting a lot of really good replies... I thank you all for your help. Hopefully this will help a lot of new resellers looking for answers as well. I know it is really helping me. Please continue to post any tips or comments.
I did contact some of the hosting sites that offer reseller accounts.
2 out of 3 e-mailed me back, within an hour (on a Saturday night.)
www.2mhost.com - after 3 weeks of submitting info requests and asking to be contacted NEVER contacted me. Definetly not going with them.
www.GLYPTO.com - Replied and answered some really newbie questions I had. But would not give me any references to contact, due to "privacy." Was not to happy about that... Although the sales lady did suggest I do a search on Reseller Forums, and that is how I ended up here.
www.clockwatchers.com - Replied very quickly. Answered my questions and even contacted some of his resellers and asked their permission to allow me to contact them and ask them questions. They (the resellers) were very helpfull. I think being able to talk with 2 of ClockWatcher's resellers was the most convincing thing for me so far.
I say this for one reason... There is nothing like getting references to check out a company. Thank you ClockWatchers.
Just FYI I have not selected a company yet, just so you don't think I am advertising for clockwatchers, but when I think a company stands out you do have to compliment them.
To be honest I thought when I came to this forum, I was gonna find a bunch of cut throats just trying to get me to sign up under them.... I was wrong. THANK YOU SO MUCH FOR YOUR HELP.
Fijian Tribe"Act before there is a problem. Bring order before there is disorder." ~ The Tao Te Ching.
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IRC: #cpanel on EFNet
10-16-2002, 04:32 PM #7Junior Guru Wannabe
- Join Date
- Sep 2002
clockwatchers looks nice but I must say their $20 for 200MB sounded a litlle less to me. There are some hosting providers around who give a GB for that price. At least this others are worth to check also.
And how many domains do clockwatchers allow in your reseller account? On their prices list they say that $10 for additional domains. So its not unlimited I think...Just fooling around...