A web hosting reseller program is a program run by a web hosting company. If you're planning to or just think about starting a web hosting business, the best way to start is by reselling webspace from a good web hosting reseller program.

1) Why start with a web hosting reseller program
2) Tips on selecting a good web hosting reseller program
3) Does reselling really work?
4) Companies that provide good reseller hosting accounts

1) Why start with a web hosting reseller program

The first thing to know is that most web hosting companies start by reselling webspace provided by other companies through web hosting reseller programs. And especially if you are not experienced with running a web hosting company, it's best to start your web hosting business by purchasing webspace from a company with a web hosting reseller program. Start by buying a small account and reselling pieces of it.

It's a good tactic to have a few web hosting accounts lined up so the service will pay for itself. It should only take about 4-5 accounts -- if it takes more, you are paying too much.

One thing that you should notice is that a web hosting reseller program of a company can differ significantly from a web hosting reseller program of another company. Here are some of the common categories:

a) You, as a reseller, act like an agent for that web hosting company. You merely advertise the service, and you clearly mention that the service will be provided by the actual web hosting company. The customer will buy directly from the original web hosting company and you, for the "advertising service", get a few percents from each sale that originated from you (your website).

b) You, the reseller, act as a marketer for the web hosting company. Again, you simply advertise the service and mention the actual web hosting company. The customer buys the service from you instead of the actual company, but all further contacts (support, complaints) do not involve you. They will be handled directly by the web hosting company.

c) You (your company) appear(s) to be a web hosting company in your (its) own right. You will be handling sales and support, but in effect only putting your own brand on someone else's service. You buy the service at a lower price and resell it to your customer at a higher one. The customers are yours and they will contact you for support. Usually the "mother company" will provide you with support, but only for the requests that for a reason or another you just can't handle. The simple requests are yours to handle.

d) This is the final category. You, the reseller, purchase a rather large chunk of web space and bandwidth (there are other features to take into account, but these are the most important ones) from the web hosting company. You are provided with the ability to slice that into pieces as you like, enabling you to create your own web hosting packages. Customers contact you for support, but you can forward the tough requests to the actual web hosting company. This is the highest degree of independence that you can get from a web hosting reseller program.

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There obvious are advantages for using a web hosting reseller program instead of managing your own server and one of the most important ones is that the actual web hosting company does the system administration work, so you're not required to have the technical skill to administer the server. Also, it's pretty easy to start a hosting business as a reseller: very low barrier to entry.

You need to have some tech expertise in order to be able to help your customers with their basic needs like answering their questions on setup and administration of their hosting account package that you provide for them. Luckily, most of this is stuff involves the use of a control panel, and that's something that you (and most of your customers) should be able to learn with reasonable ease.

There are a handful of control panels used by most hosts and this is one factor to consider. If you get familiar with one control panel you might want to stick to hosts that provide it, so you don't have to help clients with more than one. Also, it's a good thing if you pick hosts that use a control panel that's easy for your customers to use. I'd choose CPanel/WHM if I were you. Go ahead and test drive it at www.cpanel.net.

When you're just starting, neglecting the fact that most questions might seem rather hard to answer because you're not experienced enough, customer support shouldn't be much of a problem. The volume of questions will be low enough to leave time for other important things too.

Generally, if a problem is pertaining to server issues, module install etc. you should contact the hosting company, but for questions like how do I setup email accounts/database/counters, how do I setup Outlook, how do I do such and such in the control panel, which are some everyday questions from clients, you should be and must be able to provide the answer (at least 80% of time). If you're unable to do so, some other methods are available, like outsourcing someone to help you until you are confident enough to handle it yourself.

The good thing about you being a reseller though, is that your host is always there to support you. Assuming you choose to host with a company with a decent support system, they should always be there in a timely fashion to give you help with anything you are not sure of. For this reason you shouldn't worry too much about not having the knowledge or something similar because you'll be fine as long as your host has the knowledge.

However, some resellers prefer to outsource their support at places like www.bobcares.com or even www.hosticket.com, or to hire more staff. Whichever method you choose though, make sure it fits in your budget and make the plans beforehand.

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2) Tips on selecting a good web hosting reseller program

As it might've cross your mind, you do have to spend some time to find a good web hosting reseller program offered by a serious company. And by "good" I'm sure you think "cost effective", but that's not half the story. Well, don't just jump on the cheapest package you can find or the one with the most webspace/data transfer. What you ought to be searching for first is server stability and -- equally important -- good-to-great support, so make sure you research this and test it.

To test support just shoot them a few technical questions and see how fast they respond and if their response is polite and actually helpful.

Another thing you definitely should look for is uptime. Ask them for stats and figures on their server uptime, network and general quality. Do searches on their datacenter quality and the host's name to see what turns up.

Basically what I'm saying is that it's important to take your time when choosing a host so you don't find yourself in "hot water" further down the line. Get a selection together then go to www.webhostingtalk.com and ask for opinions if you're having trouble deciding.

As you can see, there's no real gage, or benchmark, but make sure you get quality support from the hosting company. Obviously, if any of your clients face any difficulties, they would expect the problems to be nailed on the head as soon as possible. Nowadays, most people expect instantaneous, round the clock kind of support, as that's being provided by many hosts. With the help of the actual web hosting provider, this can be achieved a lot easier.

Most new web hosting business owners are concerned about the amount of support tickets they're going to receive. Well, usually the number of requests won't be overwhelming. You can expect new clients to take up most of your time, but as you get along, most of the clients won't even need support unless your servers are down. This I can tell you from my own experience, as a client. Usually, after I change my hosting provider, I ask a couple of questions because usually there are a few questions to be asked.

OK... The company with the web hosting reseller program will setup your reseller account for you. To create website accounts, you would normally use a control panel and fill out some fields to create a site. You don't have to be a pro, but you should read the documentation that comes with the reseller account.

Usually the company with the web hosting reseller program will provide you with detailed instructions on how to do this. Note that the actual procedure may vary which each program (e.g. they use different control panel software), so you should only follow the instructions provided by your host. Ask (before you buy) to receive a sample of this procedure. If you feel the procedure is too complicated or not written in enough detail there are two things to think about: are you ill prepared for starting a web hosting business or the procedure in really ambiguous and you should look for another company?

Another thing that you should look for is anonymity. Most resellers don't like it to be known by their customers that they just reselling. It is especially useful if your strategy is to start small but eventually become really big. Of course, when you'll be "big", you'll have your own servers and even your own datacenter. So, if you consider branding a part of your marketing plan, try to find a web hosting reseller program that ensures anonymity.

Of course, a hacker would be able to find who's really behind your business, but the average Internet user, or even webmaster, won't be able to discover that if the web hosting reseller program is designed to assure a maximum of anonymity. Also, in order to maintain your appearance of independence, you need as much control as possible over your account to manage most things on your own and not depend on the other company for every little thing.

This is why you should find a web hosting reseller program that uses a good control panel. On of the most highly regarded control panels among clients is CPanel, because it has a user friendly interface.

Last, but not least, is the way they treat you. If their attitude is "we're the big powerful company and you're just a little-tiny ant", just forget about them. If they're dumb (excuse my bluntness) enough not to realize that little guys like you make them the giant that they are, they don't deserve to look at them twice. A company that is really serious about it's web hosting reseller program will treat resellers not only with respect, but it will promote the use of a friendly tone when it comes to dealing with customers.

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3. Does reselling really work?

Yes it does, if you work hard at it, develop an attractive package and market yourself well it can be very successful.

Most web hosting business owners witness that today's web hosting market is saturated, especially the online market. This is why they advise newcomers to find a niche. That doesn't mean you should come up with a totally new niche -- that would be very hard. You can simply find a niche with growth potential or little competition.

What is your local market like? Many businesses like to buy their hosting locally. If you are aiming for the global market and you offer nothing different, you may find it rather hard to get started...

Local (small) business users generally will pay more for less than the average web hosting buyer. So, if that is your target market, then you'll be able to sell your plans at higher prices. Your pricing and plans should reflect your target. If you have a target market, an industry, a group, etc. it will be a lot easier to understand the needs of your customers and provide a viable service to meet those needs.

If you are targeting local businesses, don't sell cheap. The market can take higher prices. Keep in mind that you will either be competing against no one or against local ISPs that don't offer enough features and charge pretty high. $20 a month is nothing to a business, so price accordingly, but don't forget to do a little market research first.

Develop some sort of business plan. It doesn't have to be a formal plan, one that you'd present the bank for a loan. A couple of pages detailing the general direction will help a lot. Price your plans right! Don't go for "I'm going to be the cheapest web hosting company around". You will not be able to sustain it. Also, try to include all your costs, including your time. And enjoy your business! If you don't enjoy it, your customers will feel it, and they won't be happy either.

These are only a couple things that you need to check, but this will help you on the road to becoming a hosting reseller.

Here's a short list of things that you should to take care of:

1) Services you need before starting to resell:

- Reseller account (www.dathorn.com, www.httpme.com, www.srlhosting.com, etc.)
- Payment Processor (www.worldpay.com, www.paysystems.com, www.paypal.com, etc.)
- Billing solution (www.clientexec.com, www.modernbill.com, www.phpmanager.com, etc.); you don't require a billing program to use a payment processor, but you need a billing program to keep track of your clients.
- Support system/helpdesk (www.kayako.com, www.inverseflow.com, www.clientexec.com, etc.)

A small tip: If you decide to use Paypal, be aware of the fact that potential clients from certain countries can't use this service because they can't open a paypal account of their own. Try to provide them with a second choice.

I am not recommending you the services that I listed above, but I can tell you that they were, at the time when I wrote this article, recommended by most web hosting resellers. Also, you might be able to run your business without a billing solution and/or a support system (just provide support by e-mail), but in the long run...

2) Get more and more customers. Yes, there are many potential customers on the Internet for you (if you provide good service), but it's a lot of work to get them to buy from you because the online market is very competitive. Look to market to your local town/county. Word of mouth is clearly the best and most effective form of advertising in the web hosting business, however, it will probably take you several months to see any large returns from it.

4)Companies that provide good reseller hosting accounts

Here are a few companies that I found to provide good based on what I've read about them on WHT:

Hostgator (I host a-web-biz.com with them, as well as most of my other sites.)
Httpme
Unitedhosting

If you need further up-to-date information, I recommend you to visit www.webhostingtalk.com and read the threads there. Use that site's search feature to find the things you're interested in, or register and post your question. There are many qualified, helpful people there to offer you the advice that you need.

Well, "this is all I have to say about that". :-) All I can do now is wish you good luck in your endeavours!

 

Related articles:

Starting a web hosting business

Choosing inexpensive website hosts

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1. A basic business plan
2. Finding website hosts
3. Accepting credit cards
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