Reseller hosting can be really profitable if you have a decent amount of clients who’ll be hosting their websites with you. Here’s how it works.
You buy a bulk hosting plan from a full-fledged hosting provider and then resell the hosting resources on a smaller scale to your own customers in packages that are also more tailor-made to their needs.
Since many resellers are first web designers, marketers, developers, agencies or freelancers, reseller hosting can be really attractive to customers because you can provide a suite of other services asides from just hosting.
The reseller hosting business can be a really lucrative business. But, is it a good idea to start a web hosting reseller business in 2023? Let’s find out!
- Reseller hosting can be a great side hustle for web entrepreneurs, web designers, developers, marketers, and agencies.
- Reseller hosting is not a get-rich-quick scheme but takes time, dedication, and a solid business plan.
- There are some things you’d need to have in place before you start a reseller hosting business including your work device, payment gateways, website etc.
- Choosing the right hosting provider is one of the key factors for your success as a hosting reseller and HostAdvice helps you do that.
- Reseller hosting is easily scalable – the more customers you have the more profit you can make.
Things To Ask Yourself Before Starting Reseller Hosting Business
Reseller hosting sounds like a good business idea. But it’s not all sunshine and roses. It also has its challenges and people who rush into it eventually leave out of frustration. So how can you figure out if reseller hosting is for you? Before you start your own reseller hosting business, ask yourself these questions:
Are you in it for “Get Rich Quick” business?
Do you want to start a reseller hosting business because you want to make money quickly? Reseller hosting is not a get-rich-quick scheme. Like with any other online business, you need to have a good execution plan along with good capital to invest.
If you do have a lot of websites (say you are an agency), getting to those dream figures may be easier for you than most but you’d still have to do the work and put in a lot of effort.
The bulk of your work would be around advertising and marketing your business, and bringing new customers on board. Your profits will grow linearly as your customer base grows and that takes time!
Do you have a plan to make things work?
You’d need to have a well-thought-out business plan you’re working with before you start a reseller hosting business. This will help you set realistic goals, know exactly how to execute your strategies, and also manage your expectations.
When creating a business plan, consider your business targets – profit, revenue, budgets, customer growth rate, etc. – this helps you measure how your business is performing and the results of testing different strategies channeled towards growth.
Do you have money to invest?
One major selling point is that reseller hosting requires minimum investment. While this is true, you’d still need to have some capital you can fall back on should unplanned expenses come up.
Buying a hosting plan in bulk may just cost you a few hundred or thousands of dollars in a year, however, you’d still have to do marketing (paid ads, creating a blog, etc), invest in a customer service team (if you want to provide better support), licenses, business insurance, tax, etc. And these cost money.
If you are starting afresh, you will have to invest in designing a website, getting it online, and paying for hosting your website itself. So you’ll need to have some capital on hand.
Are you looking to make your living with this business?
Making money with reseller hosting is possible and in many cases, if you have enough clients, you can make great passive income so that it becomes your main source of income. But that will require a lot of planning, time, and strategy.
Your most guaranteed route to success, especially if you’re just starting out, is to resell hosting as a side hustle and grow your main business (if your work deals with website management) because the more clients you get, the more income you can earn from your reseller hosting.
And then when your side business has grown considerably, you can focus on your marketing to also get clients who only need hosting and not your other services. This will take time but in the end, will be worth the effort.
Typical People Who Become Hosting Resellers
Now that we’ve discussed some important questions you should ask, what kind of people or businesses have the most success with reseller hosting so you can know if it’s right for you?
Web hosting entrepreneurs
Entrepreneurs looking to build their own mini web hosting companies are the bulk of hosting resellers. For these brands and businesses that don’t have the resources yet to invest in a data center and physical servers, they simply buy reseller hosting plans for bigger industry names, rebrand it, and then resell them as theirs.
IT companies oversee and provide technical support to their clients and manage the installation of new software and infrastructure. IT companies make very good candidates to become hosting resellers as choosing the best web hosting provider for the clients, falls under their jurisdiction. IT companies can simply buy these plans in bulk and then resell them with the right amount of resources – metrics they know so well since they manage the clients’ websites.
Marketing agencies help businesses get established and grow online and any business that wants to do just that must have a website. Many small to mid-sized business owners are not very technical and don’t know much about hosting. As a marketing agency, you can provide website creation, hosting, and marketing as a complete suite of services to your clients. That way, they’d be happy to pay for everything they need from you as their all-in-one solution and not have to bother with trying to figure out the best plans for them.
People with a lot of websites
You may just have a lot of websites you manage and not want to resell hosting to other people… that’s totally fine! Most reseller hosting packages are designed to allow you to host unlimited websites and many control panel logins that you’d find handy if you have a lot of websites.
Web developers and designers
Web developers and designers help their clients create their websites from scratch. Web designers also make excellent candidates for hosting resellers as they can sell website design, domain names, hosting, SSL certificates, all-in-one.
What Do You Need To Start Your Reseller Hosting Business
So you’ve decided that reseller hosting sounds like a great idea to you eh? What do you need to get started and start managing your business?
A computer or laptop
While you can do most things you’d need to do from a mobile phone, we’d still recommend having a laptop or desktop as your mission control. That way, you’d be able to see every feature and manage them conveniently.
You need a fast internet connection so you can keep tabs on everything that’s going on in real time. Consider investing in a router and signup to a service that’s well known for performance.
Reseller hosting account
To get started, you’d need to sign up and buy a plan from a hosting provider that sells reseller hosting packages. Here’s a list of our best hosting resellers in 2023.
When you start to get paid, you’d need a bank account to keep all those stacks (hopefully). And you’d need a business bank account for that.
Payment gateway provider
A payment gateway provider allows you to receive payment from your customers to your bank account by providing several payment options to them. Paypal and Stripe are two popular payment gateway providers you can use.
Registration with tax authorities
In most countries around the world, you’d need to register your business with the relevant tax authorities so you can be billed appropriately based on your earnings.
Your own website
And finally, you’ll need your own reseller hosting website. All your marketing efforts will be directed to your website or landing pages on your website where prospects can then pay for your services. If you also have a blog, it will be hosted on your website.
Advantages of Starting a Reseller Hosting Business
Some of the advantages and benefits of starting a reseller hosting business?
It’s Great for Web Entrepreneurs and Professionals
First, reseller makes an excellent side hustle for online entrepreneurs and professionals who know about how websites work and how to market online products. Reseller hosting can be a great source of passive income for entrepreneurs who want predictable recurring revenue. Y
For people who have a lot of websites or know about web management, they can make a good amount of money by reselling hosting.
You can Start with Low Investment
Another advantage of starting a reseller hosting business is you don’t need much capital to start off. You are not investing in any physical server or infrastructure – those are owned and maintained by the hosting company. You are only paying for the plans, designing your website, and marketing your business. This makes it an incredibly attractive business for people looking for high ROIs.
Little to no Technical Expertise Required
Thirdly, most of the technical stuff on the hosting backend is managed by the hosting provider meaning even people who don’t have much technical knowledge can take advantage of the business. Most providers sell fully managed plans that take out the hassle of managing your databases and other ‘high-tech’ stuff out of your hands.
Potential to be Scalable
One particular reason why the reseller hosting business has become very popular is that it is very scalable. It’s simple – the more customers you have, the more money you make. So once your marketing is on point and you are growing your customer base reliably, your revenue and profits will continue to increase.
The Demand for Personalized Hosting Solutions is Increasing
Slowly but surely, webmasters and business owners are looking for personalized hosting solutions. Many big-name hosting providers have too many customers and can’t cater to all their needs and only create generic plans that may leave a lot of resources wasted or not provide the right tools.
Reselling hosting gives you the opportunity to customize your services to your client’s needs and charge more for it. You can also cater better to your customers and provide even better support than full-fledged hosting companies.
You Can Make Good Profits
As an extension of its scalability, you can make good money if you have a large customer base and also accurately predict your Recurring Revenue Models – Types & Examples and plan ahead for growth. If you have say 100 customers and you’re reselling your niche packages for $30/month (you can charge higher than that depending on your customer persona), that means you can earn a $3000/month revenue. Subtract the amount you pay to the provider per month to get your profit.
Some hosting resellers charge way more than that and manage hundreds and thousands of clients, so you do the math!
Disadvantages of Starting a Reseller Hosting Business
A reseller hosting business is great but it still has some drawbacks. Let’s check out some of them:
You Still Need Some Technical Knowledge
We’re not contradicting the point we made earlier, however, to start a reseller hosting business, it is much better if you still had some technical knowledge to start with. As a website designer, developer, marketer, etc. this should be no problem for you.
However, if you are a total greenhorn, it may be better to take out some time to understand the basics of hosting, managing a business, creating websites, marketing, and so on.
While it is indeed possible to start the business without any technical knowledge, those who do have that will have an advantage over those who don’t as they can’t relate better to the needs of their target customers and can better market their services. Also, having a good understanding of how to run an online business would help you make the right decisions as you grow.
There’s Good Competition
What happens when there’s a business model that promises passive income and has a low entry barrier? A lot of people jump right in. That’s exactly what reseller hosting is. If you’re looking to start out as a hosting reseller, you’d be competing with thousands of other brands who want their share of the market.
That’s why it becomes important to stand out by niching down and becoming an expert in an industry, providing superior customer support, and doing multi-channel marketing. That’s how to become a successful hosting reseller.
Conclusion: Is Reseller Hosting Worth It?
Reseller hosting is an excellent way to generate passive income especially if you run a business where you deal with website management. You can easily integrate reseller hosting into your business and offer the service along with your core services so you can appeal to more clients and save them the hassle of trying to figure out the best hosting packages for their needs.
When starting a reseller hosting business, you should have a plan in place, some backup capital, and be ready to push your services over the long haul. You won’t get rich quick with reseller hosting, however, with the right knowledge and strategies, and commitment, you can grow your business into a mini-empire with hundreds or even thousands of clients and then make handsome profits.
Next Steps: What now?
- Find the Best Reseller Hosting provider with reseller packages
- Create a business plan
- Create a website and list your services
- Set up your payment portals
- Do market research and start growing your customer list
- Buy a reseller hosting plan
- Market your services on social media, Google & Bing, email (if you already have clients), create a blog
- Automate repetitive tasks