- Dec 23, 2020
- by Alex Ali
Finding new revenue streams can be daunting. You may have to compete with more established brands, seek out new clients, or convince existing customers that you’re also an expert in additional fields.
However, diversifying your income doesn’t have to be difficult. By becoming a hosting reseller, you can sell the services of an established, experienced web host, without any of the setup costs or maintenance headaches.
In this guide, we’ll show you how to become a hosting reseller, even if you have zero existing experience. We’ll walk you through the process of selecting a hosting provider, creating your hosting packages, and providing exceptional customer support. Finally, we’ll share some tips, tricks, and advice on how to promote your brand-new web hosting business. Let’s jump right in!
An Introduction to Reseller Hosting
For the uninitiated, reselling is the act of purchasing a product or service from a third-party, and selling the product or service on for a profit. As a hosting reseller, you’ll purchase a hosting package from a trusted, established hosting provider. You can then divide these hosting resources into a number of smaller accounts and sell them to customers.
Most of the time, your customers will be completely unaware that you’re a reseller. You’ll be their point of contact for everything from support queries, to upgrades, and payment. Note that you’re not conducting any shady practices here, or otherwise ‘hoodwinking’ the customer. You’re essentially ‘white-labelling’ a hosting provider’s services, and taking on some of the responsibility.
Overall, becoming a hosting reseller is a cost-effective, low-risk way to diversify your income that’s also easy to setup and maintain. We’ll talk more about how to launch your hosting reseller business soon, but first, let’s dig deeper into why you’d want to become a hosting reseller in the first place.
The Benefits of Reseller Hosting for Your Business
There are lots of reasons to start your own reselling business. Whether you’re an established business looking to cross-sell to your existing customers, or you’re eager to embark on a new business ensure, here are some of the benefits of reseller hosting.
You Can Diversify Your Income
Running a business is tough, and demand for your primary products and services may naturally wax and wane throughout the year. Other products may be occasional, or even one-off purchases. Even if you provide high-quality goods and exceptional customer service, no-one is going to purchase an unwanted replacement product.
Changes in market trends can also impact your bottom line. Just because your flagship product is flying off the shelves now doesn’t mean it’ll be in high demand forever.
If you let your business stagnate, you could easily wind up with less sales, clients, and a dwindling income. By diversifying your income, you can protect your business against market fluctuations, and remain competitive and profitable in today’s challenging economic climate.
You’re Able to Cross-Sell to Your Existing Customer Base
In today’s market, it’s difficult to think of an organization or business that doesn’t need a website. Whether it’s a local, independent boutique or a multinational corporation, every business can benefit from an online presence.
If you have an existing customer base, then you have a built-in audience for your reseller hosting business. By becoming a reseller, you can boost your income, without any of the time and effort typically associated with securing new customers.
You Can Provide a Better Experience to Your Existing Clients
The unknown can be scary. Most customers will feel happier purchasing from a company they have an existing relationship with, rather than taking a gamble on an unknown third party.
By offering web hosting services to your existing customers, you can maximize your revenue, while improving the customer experience – a win-win situation. If you already provide tech-focused products and services, you could even combine your offerings to create a convenient, all-in-one package that covers all your customers’ IT needs.
You’ll Likely Build Customer Loyalty
It’s difficult to build a business on one-off purchases. As a subscription-based model, reseller hosting can provide your business with a reliable, recurring income.
Reseller hosting can help you transform one-off or occasional purchases into loyal, repeat customers. Assuming that you keep your customers happy, each new hosting package sale could provide your business with recurring revenue for years to come.
You’ll Usually Avoid Setup Costs and Other Complexities
Starting a web hosting business from scratch requires a significant upfront investment. At a minimum, you’ll need to purchase servers and software licenses, and setup your own network.
By opting for reseller hosting, you immediately eliminate these startup costs. Simply purchase a hosting package from an established and trusted hosting provider, and you’re ready to start selling web hosting.
Maintenance Doesn’t Have to Be Your Responsibility
Servers require ongoing maintenance, including upgrades and replacement parts. You may even have to hire full-time staff who’ll be responsible for managing your server infrastructure.
If you opt for reseller hosting, your provider is responsible for monitoring and maintaining the server equipment. Not only can this save you a significant amount of time and effort, but it can also replace unpredictable costs with a set monthly or annual payment.
Even in the event of a catastrophic equipment failure, your hosting provider is solely responsible for getting their servers back up and running. No matter how expensive the repairs, you can continue paying your pre-agreed subscription fee, and raking in the profits.
There Are Opportunities for Expansion
In today’s competitive and challenging market, you can’t afford to stagnate. Once your hosting venture is delivering a steady income, there are lots of opportunities to expand your operations.
You might encourage new sign-ups by creating a web hosting affiliate program. Alternatively, you could add extra hosting-related services to your repertoire, such as reselling domain names, and become a one-stop-shop for all your customers.
How to Get Started as a Successful Hosting Reseller (In 7 Easy Steps)
Instead of spending more time talking about all the benefits of reseller hosting, let’s look at how to create, launch and run a web hosting business. Here’s our seven-step plan to becoming a successful hosting reseller!
Step 1: Choose Your Host
As a hosting reseller, your services are completely dictated by your hosting provider. Therefore, choosing the right provider for your reseller business is crucial. Get this step right, and you’re off to the best possible start. Get it wrong, and your new business venture could be facing an uphill battle.
When choosing a hosting provider, we’d recommend paying particular attention to uptime. This is the amount of time the provider’s servers have been up and running, and is usually expressed as a percentage.
If your hosting provider’s servers go down, it’ll take all of your customers’ websites down with it. For your customers, downtime means everything from Search Engine Optimization (SEO) penalties, missed sales, and loss of revenue.
For you as a hosting provider, downtime means one thing: unhappy customers. By choosing a hosting provider with a high uptime rate, you can maximize your chances of happy, repeat customers who’ll recommend your business to all their contacts.
Once you’ve checked the hosting provider’s uptime rates, you should investigate other factors such as whether the hosting provider prioritizes performance. You should also check their reputation amongst customers, including their rating on third party review sites such as Trustpilot.
When you have a network of customers relying on your hosting services, it’s also vital that you can contact your hosting provider 24/7. Ideally, your provider should be contactable via multiple channels, and provide self-help resources such as a detailed knowledge base and regularly-updated blog.
When choosing a hosting provider, there are many factors that you should take into consideration, but there’s one major deciding factor. You should only use a reseller provider who you’d trust to host your own website. After all, if you wouldn’t be happy to use a particular hosting provider, then why would your customers?
Step 2: Choose Your Hosting Package
It may be tempting to opt for a package that provides unlimited resources, including uncapped memory, bandwidth, and disk space. However, customers will be reluctant to pay for resources that they don’t actually need. To provide the best value for money, your chosen hosting package should reflect your customers’ needs as closely as possible.
When choosing a package, you should carefully examine the computational resources included, such as disk space. Wherever possible, you should opt for a Solid State Drive (SSD) as they offer excellent read-write speeds, especially compared to traditional mechanical hard disks. At A2 Hosting, all our reseller hosting packages provide SSD, ranging from 200 GB to a more budget-friendly 30 GB.
You should also try to gauge the amount of bandwidth your customers will require. This can vary depending on factors such as page size, and the amount of traffic their website typically receives. If you can’t accurately estimate the required bandwidth, then we’d recommend a provider that offers a range of bandwidths. Ideally, your chosen provider should also make it easy to upgrade to a higher bandwidth, if required.
The number of Central Processing Units (CPUs) is also an important factor. Just like your home computer, your provider’s server has multiple CPU cores. The bigger the CPU capacity, the more information the server can process before losing performance. To ensure a high level of performance, all our A2 Hosting reseller accounts have a 32 core server minimum, and two cores per cPanel user.
There are more factors to consider when choosing a reseller hosting package, but bear these points in mind and you’ll be off to a good start. For more information, always search your provider’s website for a detailed breakdown and comparison of all the hosting packages they offer.
Step 3: Create Your Customer Hosting Packages
Once you’ve purchased your reseller hosting, it’s time to divide those resources into packages, ready to sell to your customers. To maximize sales, it’s important that your pricing strategy reflects your target audience.
Factors such as resource allocation, the type of hardware and software licenses available, and the level of customer support you offer, should all influence your pricing strategy. This means that you should consider these factors carefully when creating your hosting packages. Ideally, your packages should offer all the resources and features your customers need, at a price that makes sense for them.
If you purchase an A2 Hosting reseller account, you can create packages using WebHost Manager (WHM). This is a dashboard that has almost everything you need to manage every part of your reseller business, including creating your hosting packages.
If you’re an A2 Hosting customer, you can access WHM by logging into the A2 Hosting client area. From here, you can choose your reseller hosting account, then select Login to WHM.
In the WHM console, select Add a Package. On the subsequent page, give your package a descriptive name and specify the resources that you want to include in this package, such as Disk Quota, Max Databases, and Max Addon Domains.
Once you’re happy with your hosting package, click Save. Rinse and repeat to create multiple hosting packages, such as the classic Bronze, Silver, and Gold pricing structure offered by many web hosting companies.
Step 4: Plan Your Support System
There are many different ways to offer customer support. Depending on your target audience, some methods may be more appealing than others.
An email or a ticket-based support system may be perfect for non-urgent queries. Customers with limited technical knowledge may also feel more comfortable communicating via text, as it removes the time pressure.
With emails and support tickets, the customer has plenty of time to consider their response. For the same reason, text-based support systems are often popular with customers who aren’t communicating in their preferred language.
Customers who are completely reliant on your web hosting will typically require more immediate support. If a customer’s business-critical website goes down, they’ll need to contact your support, now. These customers may prefer live chat or telephone support, rather than waiting for an email response.
If you’re an A2 Hosting reseller, your customers can contact your support agents directly from cPanel. Using WHM, you can add your support information and contact details to the customer’s cPanel account. Add this information, and your customers will know exactly where to turn if they ever encounter an issue.
Log into your WHM console, and select Customization > Public Contact. Here, you can enter all the information your customers need, in order to contact your support agents, or access your support services.
You may also want to provide self-help resources, such as tutorials, knowledge bases, and wikis. Self-help customer support is ideal for more tech-savvy customers who prefer to resolve problems themselves.
You can make these self-help resources accessible via the customer’s cPanel. Log into your WHM console, and select Customization > Customize Branding.
You can now add links to your self-help resources. These URLs will be displayed in the customer’s cPanel interface, similar to your customer support information.
Step 5. Define Your Terms of Service
Every host, including resellers, need to define their own Terms of Service. This agreement can prevent customers from abusing your products and services, and limits your liability. It also establishes ownership over your intellectual property, including content, trademarks, and copyright.
As a reseller, your Terms of Service must be in accordance with your hosting provider’s acceptable usage policies. You’ll find these terms on your hosting provider’s website.
If you’re unsure, you can contact your hosting provider for guidance. A good hosting provider should be willing to work with you, to ensure your Terms of Service are in line with their own policies.
After establishing your hosting provider’s wishes, you can start writing your Terms of Service. Alternatively, you can get a helping hand using a tool such as TermsFeed. You can use this tool to generate some Terms of Service boilerplate, and customize it based on your hosting provider’s requirements.
Step 6. Get Your Hosting Business Online
Next, you need a way to get your hosting packages in front of potential customers. Sometimes, web hosting is a natural extension of your current services. In this scenario, you may want to add landing pages to your existing WordPress website.
While you can create landing pages using WordPress’ built-in features, page builders give you more control over your landing page’s look, feel, and functionality. Elementor is one of the most popular page builder plugins, and provides everything you need to build beautifully-designed landing pages.
Alternatively, you can build an e-commerce store dedicated to your web hosting business, using the popular WooCommerce platform. This gives you the ability to build a professional-looking e-commerce site within WordPress. This platform also integrates with popular payment gateways, so you can accept payments via services such as PayPal and Stripe.
Once your landing page or e-commerce site is up and running, you’ll need to promote your services. There are plenty of marketing tips, tricks, and techniques that you can use, but popular techniques include posting to social media channels such as Instagram and Facebook, and driving traffic to your website with email marketing campaigns. You should also take steps to ensure your site is ranking highly in Google’s search results.
Step 7: Bill Your Customers
Compared to many other businesses, running a successful reseller hosting business should require little day-to-day work. As a reseller, you just need to concentrate on signing up new clients. Your hosting provider will then work behind-the-scenes to provide your clients with the best possible customer experience. You can take all the credit – and collect all the payments!
To make the invoicing and payment process easier, we recommend using a web management platform. These can automate many of the administrative tasks associated with running a successful web hosting business. This includes activating new orders, renewing client subscriptions, and invoicing.
At A2 Hosting, our resellers have a choice of two popular web hosting management platforms. Our Web Host Manager Complete Solution (WHMCS) and Blesta licenses provides plenty of functionality to automate day-to-day administrative tasks. This makes it even easier to run a successful web hosting business.
Diversifying your income can help protect your business against fluctuations in the market. By reselling hosting services to your existing customers, you can maximize your revenue without any of the initial setup costs and ongoing maintenance expenses.
In this post, we’ve shared a seven-step plan to get your reseller hosting business up and running:
- Choose your host
- Choose your hosting package.
- Create your hosting packages.
- Plan your support system.
- Define your terms of service.
- Get your hosting business online.
- Collect your money.
There are many factors you should take into consideration when choosing a hosting provider, but we’d recommend paying particular attention to uptime. If your hosting provider’s experience downtime, so will your customers.