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Reseller Business

rainplanet

rainplanet

New Member
Hi all, i want to hear your opinions about reseller accounts.

I am confused with the reseller packages offered by many hosting companies... Usually their $$ /GB are much more expensive than their shared hosting plans. In my understanding, if we buy something to sell it again then we should buy it at lower price so that we still can make profit when we resell the product. But with hosting reseller accounts, it seems that the prices for resellers are much more expensive that makes it impossible to compete with themselves.

Just a quick example:
Hostgator offers shared hosting package "Hatchling" with 350,000mb for $4.95 per month while their their "Aluminum" reseller hosting package cost $24.95 a month for 24,000mb. If I resell a hosting service that I buy from them then obviously I will not be able to compete with them.

Or do I miss something here? Thank you for your opinions.
 
rainplanet said:
Hi all, i want to hear your opinions about reseller accounts.

I am confused with the reseller packages offered by many hosting companies... Usually their $$ /GB are much more expensive than their shared hosting plans. In my understanding, if we buy something to sell it again then we should buy it at lower price so that we still can make profit when we resell the product. But with hosting reseller accounts, it seems that the prices for resellers are much more expensive that makes it impossible to compete with themselves.

Just a quick example:
Hostgator offers shared hosting package "Hatchling" with 350,000mb for $4.95 per month while their their "Aluminum" reseller hosting package cost $24.95 a month for 24,000mb. If I resell a hosting service that I buy from them then obviously I will not be able to compete with them.

Or do I miss something here? Thank you for your opinions.
Click to expand...

To make It basic the general running costs of a server with Resellers on it is higher than with general hosting accounts.

Think of it this way
You have a server hosting 200 standard accounts they only use about 200 GB Space Thats 1 GB/Account

You have 200 Reseller accounts, Each reseller account hosts 30 people, That means 200x30 = 6000 ACCOUNTS technically being run on the server. There is a lot more server stress. Now do maths, 6000 Clients, 1GB/Account that makes 6TB Of DATA.

Also General people will do massive amounts of overselling with standard hosting accounts because people won't use much space for their small sites. However when getting a reseller account its almost guaranteed they will use all the space they can to host their clients on.

Hope that helps clear things up a bit for you.
 
I might also add... Many times when you see that ridiculous amount of space and bandwidth on single user accounts they will limit the amount of domains that you can have added on. With resellers they are usually not placing a limit on domains added even if overselling is turned off.
 
thanks for your replies...

i guess the math does make sense... but i still can't see how to make my packages more attractive than what is offered by the hosting company from whom I get my reseller package.
 
Some how its common desire to beat the parent company. My suggestions:-

1. Forget about the hosting company from whom you get the reseller plan. See market trends, think whats logical and go ahead with what you think will make sense in packages. Its the marketing theme which sets the tone. The ones who are expensive say they are providing quality and that the quality services cannot be there at throw away prices. Cheapest hosting in not always what people are looking at.

2. Multiply available space with 5. Thats the space you can sell. Almost same goes for bandwidth. That means if you are paying for 1GB you can sell 5GB. That shall give you competitive edge.

May be that helps...:wave:
 
For my oppinion, by building a website for client and add doing reseller is much more easy than only be a web hosting reseller.oldman2
 
I think reselling from a reputable company is the reliable way of running a business. But this company must provide in-house support. Outsourcng in this case isn't accetable. For example, Ahosting.biz and HostGator.com provides such services.
 
All due to 2 main reasons:

1) Support / Abuse
2) Overselling


Support / Abuse
Resellers require alot more support (Due to their clients requiring assistance that the reseller account provide, etc), a reseller is not like having 1 client, it's like having 10.

The abuse is also higher - With shared hosting, the host knows EXACTLY who they are letting on their server (Or they should do), with a reseller account, thats not always the case, they have no idea who their reseller will host.

Overselling
Companys like HostGator and DreamHost, Oversell, it's okay to oversell a little (10% most), but HostGator and DreamHost oversell over 600+% on their shared hosting accounts, they go on the base that their shared hosting accounts wont use much diskspace or bandwidth, and if they do, they suspend their account.

Now that is not feasable with resellers, and resellers are well known to use ALOT more than a shared host (Nearing all their resouces) so instead of overselling on resellers, they dont, which is why the price is that much more expensive.

Hope that sheads some light ;)
 
Reseller is basicly Reselling the space you brought, it could help you pay for the Account it self, and has many ways of earning money of it,
 
mwaraitch said:
Go for a managed vps to get out of the un ending loops in which the reseller hosting may get you.
Click to expand...

Exactly. Vps are much better if you can't afford a dedicated server. I got to the point where I stop selling reseller plans because I've witnessed the stress it puts on the servers. Now any hosts that ask me for a reseller plan I point to this post. (I've done it 3 times in the past week) and then I can usualy convert them into a vps sale.
 
rainplanet said:
Hi all, i want to hear your opinions about reseller accounts.

I am confused with the reseller packages offered by many hosting companies... Usually their $$ /GB are much more expensive than their shared hosting plans. In my understanding, if we buy something to sell it again then we should buy it at lower price so that we still can make profit when we resell the product. But with hosting reseller accounts, it seems that the prices for resellers are much more expensive that makes it impossible to compete with themselves.

Just a quick example:
Hostgator offers shared hosting package "Hatchling" with 350,000mb for $4.95 per month while their their "Aluminum" reseller hosting package cost $24.95 a month for 24,000mb. If I resell a hosting service that I buy from them then obviously I will not be able to compete with them.

Or do I miss something here? Thank you for your opinions.
Click to expand...

I think you are mistaken. With a reseller account, you can make MORE cPanel accounts under your user, not just put an offer up on your site, get the money, buy it from hostgator as you may be thinking.
 
Its more expensive because it allows you to solely re-sell shared hosting at whatever cost you wish. So it is always wise to plan accordingly and set your pricing where are you above the break-even point.
 
Just a quick example:
Hostgator offers shared hosting package "Hatchling" with 350,000mb for $4.95 per month while their their "Aluminum" reseller hosting package cost $24.95 a month for 24,000mb. If I resell a hosting service that I buy from them then obviously I will not be able to compete with them.
Click to expand...
Two differnt packages.... One of them alloweb to be resold out and othe not. I think that there are differnt number of domains name tobe hosted on the account.
 
mwaraitch said:
2. Multiply available space with 5. Thats the space you can sell. Almost same goes for bandwidth. That means if you are paying for 1GB you can sell 5GB. That shall give you competitive edge.
Click to expand...

How do you manage to resell 5 times more than what you pay for?
 
jovis said:
How do you manage to resell 5 times more than what you pay for?
Click to expand...
You do the same think we do. Post ads on this threads selling hosting. Howver I would strongly suggest trying to join an existing team that is already established it will save you alot of time getting started writing tos ect.
 
How do you manage to resell 5 times more than what you pay for?
Click to expand...
Anyway that is high risk to sell more then you have, because once you get customer which need all 5 GB and you have only 1. That will be the end.... I think that you have to think twice before starting such.
TOS is the thing which is always read when customer start get troubles.
 
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