Learning how to resell web hosting is not as difficult as you may think. Whether you are looking to build your own web hosting business or want to make some extra money on the side, reselling web hosting can help you achieve both outcomes.
A reseller web hosting business can be likened to renting out certain rooms of your home or perhaps running an Airbnb (Air Bed and Breakfast). By making certain rooms of your home available to clients, you will be able to add a new stream of income without hiring contractors to build new rooms.
However, to succeed, you want to learn the ins and outs of web hosting reselling. Below, we discuss what reseller hosting is, how you can make money from reselling web hosting services, how much it costs to start a web hosting company, the benefits and drawbacks of reseller hosting, and key reseller features you should look for, and outline steps to resell web hosting.
Table Of Contents
- What Is Reseller Hosting?
- How Do You Make Money Reselling Web Hosting Services?
- How Does Reseller Hosting Differ From Affiliate Programs?
- How Much Does It Cost To Start A Web Hosting Company?
- Advantages Of Reseller Hosting
- Disadvantages Of Reseller Hosting
- Key Reseller Hosting Features You Should Look For
- Steps To Resell Web Hosting
- Start Using Reseller Hosting Today
What Is Reseller Hosting?
Reseller hosting is a business model whereby web hosting providers allow some or all their web hosting services to be sold by third-party organizations or individuals. Reseller hosting allows third-party organizations and individuals to act as web hosting providers without building, operating and managing a web hosting infrastructure.
As a web hosting reseller, you can rent a hosting server, brand the server with your own company, and sell that server space to clients. Because everything is white-label, it is as if you are running your own web hosting services company; however, your clients will never find out that it is not you. You can create your own hosting plans, offer additional features like website and email backups, and take payments.
How Do You Make Money Reselling Web Hosting Services?
Whether you are looking to start your own hosting company, offset your hosting costs, or earn an extra buck, you can quickly achieve these outcomes with a reseller web hosting business. The web hosting industry has a low cost of entry compared to starting from square one as a hosting provider. Even with a handful of clients, the right reseller hosting plan and the right pricing strategy can translate into a regular stream of income.
Once you understand how your goals of generating revenue fit with other business priorities (such as service quality), you should consider your market trends, customer profile, revenue targets, and competition, as these will help you price your hosting plans in a way that generates high amounts of revenue.
Of course, you want to start off slow, but ensure that you research and understand profit margins. A study the New York University found that computer service organizations can expect to earn a 6 percent profit margin. Yes, you will want to cover your costs while remaining competitive, but do not shy off from pushing for more profits.
How Does Reseller Hosting Differ From Affiliate Programs?
If you have been looking for a way to make passive income by recommending services or products, then you have probably come across the terms “resellers” and “affiliates.”
At their core, resellers and affiliates share many similarities; however, the mechanics required for each are worlds apart.
Reseller hosting involves reselling a service under your own brand name, but you do not have to stress over the fulfillment of that service. On the other hand, affiliate programs involve sending clients to businesses in exchange for a commission on the sale.
How Much Does It Cost To Start A Web Hosting Company?
The amount of money you need to start your own hosting company depends on your initial customer accounts and how many customers you are seeking to serve.
While a domain name and web hosting are standard expenses, here is a breakdown of other expenses you may face:
- Domain Reseller Account: $50 One-Time Fee;
- Website Design Template: $100 One-Time Fee;
- Domain Name Registration: $10 to $20 Per Year;
- Customer Support Software: $5 to $199 Per Month;
- Reseller Web Hosting Account: $15 to $400 Per Month;
- cPanel/WHM (Web Host Manager) License: $200 to $425 Per Year;
- WHMCS (Web Host Manager Complete Solution) License: $16 to $40 Per Month;
Introductory reseller hosting plans are often set up on a shared server environment; however, you can resell hosting resources on more expensive VPS (Virtual Private Server) or dedicated server plans. You can also resell reseller hosting packages as a master reseller.
Moreover, some web hosts use alternative reseller hosting strategies where you can take a percentage discount from a variety of options (for example, GoDaddy), buy credits that you can redeem later for various services (for example, SiteGround), or purchase individual shared hosting accounts for resale (for example, Hostwinds).
Advantages Of Reseller Hosting
If you are looking to start a web hosting business, here are some of the benefits you can expect:
- Low Startup Costs: When starting out, you only need to invest in a website and enough hosting space for your first clients. There are no infrastructure costs, which means that you can keep your cost relatively low until you break even.
- Income Opportunities: If you have an existing online business, you can make additional profit from reseller hosting by selling add-ons such as domain name registrations, dedicated hosting, dedicated IP, VPS hosting, and SSL certificates.
- Focus on the Business: With reseller hosting, you can focus on the business aspects instead of the technical aspects of running a reseller hosting business. This is because the web hosting provider you have purchased or rented from handles all tasks related to security, connectivity, and maintenance.
- Affordable Hosting Plans: Web hosting reseller plans are fairly cheap, making them a great option for individuals or third-party organizations looking to venture into the reseller hosting business. Additionally, reseller hosting simplifies things because you do not have to buy any equipment, technology, or infrastructure needed to become a web hosting provider.
Disadvantages Of Reseller Hosting
Even though reseller hosting offers many benefits, here are some downsides of reselling hosting:
- Limited Server Access: You will have to go through your web hosting service provider for nearly everything since reseller hosting offers limited server access.
- You Have to Set Some Time Apart For Customer Service: As a hosting reseller, you are responsible for answering questions from your clients. If you do not set time apart to answer these questions, you could come off as unreliable and end up losing valuable clients.
- You Are Dependant On Your Web Host: The quality of your web host will determine the success of your reseller hosting business. If your web host experiences a lot of technical issues or their server regularly goes down, your reseller business will be impacted.
- It Is Difficult to Compete On Price: Sine you are going to resell hosting, you will not be able to offer the incredibly low prices that most web hosts are able to offer. Therefore, you must come up with other differentiating factors that will help you capture the attention of prospective clients. Perhaps you can offer excellent customer service or include a hosting setup for free.
Key Reseller Hosting Features You Should Look For
Your parent host will determine the reseller hosting features you can access and pass on to your clients. Some important features to look for when sifting through reseller hosting providers include:
- High-Quality Servers: When you choose a high-quality web host, you can offer different hosting types and a range of storage and bandwidth.
- Bundled Features: Bundled features allow you to offer other features such as domain management, website builders, email hosting, and cPanel access.
- White Label Hosting: White label hosting lets you brand your reseller hosting business while using the hosting services of a web hosting provider.
- Plan Customization: Plan customization allows you to manage your reseller hosting plans and customize certain features so that you can offer unique reseller hosting services.
Steps To Resell Web Hosting
Choose A Reseller Web Hosting Partner
Instead of signing up for more server space from your favorite hosting provider, take some time to think about your reseller business and the kind of services you want to provide to your clients. The route an established web development agency will take may be completely different from the route someone starting a hosting company will take.
Apart from the affordability of a web host, important features to look for in a hosting partner include the software, hardware, and operating system, as these will make your clients’ experiences more enjoyable and efficient.
Before choosing a hosting partner, you should ask yourself the following questions:
- What hosting needs do your clients have?
- Do you want Linux or Windows reseller hosting?
- How many clients do you expect to sell hosting services to when you first begin?
- Do you want to stick to traditional hard disk drives, or would you prefer faster solid-state drives?
- Do you prefer the shared server resources offered by shared hosting, or do you need the scalable resources of VPS hosting?
The answers to these questions will help you compare ratings and reviews of reseller web hosting providers to find the plan that suits your needs and those of your clients.
Build Your Hosting Services
You probably know what your clients want, but put yourself in their shoes and imagine looking for a new hosting plan. What features and services would capture your attention? Would you want free SSL certificates or automatic backups? Would you need add-on domain names?
If you choose Linux reseller hosting, you will likely use cPanel and WHM to create and manage your hosting plans. If you have created and managed a web hosting account before, you probably know how control panels work. However, as a reseller, you will now have access to WHM, which allows you to backup or transfer customer data, monitor and protect your server, and create cPanel accounts for your clients.
Before you set up your reseller hosting business, you need to handle the organizational tasks. If your hosting provider supports white-label hosting or private nameservers, you will want to update your nameservers and add your branding and logo.
WHM should direct you to where you need to go, but if you are having difficulty with this, you can click on Basic Web Host Manager Setup in the menu to the left. Then, add your nameserver and contact information and scroll through the menu on the left to adjust the customization options for the cPanel interface.
Once you have done all these, name your hosting plans and allocate specific limitations and resources. You can do this by clicking on Packages in the WHM menu and following the prompts.
Set Your Prices And Configure The Billing System
You are not running a charity organization, are you? As the name suggests, reselling means that at some point, money will change hands. Whether you are expecting to turn a profit or offering friends and family discounts, you need to determine how much you will charge for your services and how you will notify clients when their payments are due.
When you figure out how much you will charge for your services, an automated billing system will take care of all the billing functions. Most reseller plans that include WHM and cPanel also include WHMCS, which automates all aspects of your reseller hosting business, from generating invoices and collecting payments to sending reminders and covering client management.
Support Your Customers
As a web hosting reseller, the support you are able to provide your clients will either make or break your business. Providing stellar customer support is one of the best ways to make your business stand out. Actually, when your customers are satisfied, they can help spread the word about your business.
Customer support starts immediately after a customer lands on your website. If a customer has any questions about your services, they should be able to reach a representative via the live chat function. Moreover, your site should be easy to use, and customers should not have any trouble signing up for hosting services.
Most hosting parent companies include customer support as part of their reseller packages, meaning they handle all support requests. You can decide to let the parent company handle all the support requests, support the parent company’s support with your own team, or let the parent company handle technical support while you handle other requests.
Set Up Marketing
Your marketing efforts should be focused on a specific niche instead of marketing to anyone and everyone. First, you need to determine how you are going to reach potential clients. For example, will you use Facebook ads and strategically-targeted landing pages? Do you have a budget for social media and search engine advertising?
Figure out the approach you are going to take and create measurable campaigns. If you have a limited budget, it would be best if you take an organic approach until you have enough money to invest in advertising campaigns and paid marketing.
Profit And Scale
By now, you should be ready to start your reseller hosting business. You have found your niche, built your website, laid out your service offerings, found a reliable hosting reseller, and started marketing your services.
One of the perks of a reseller hosting business is that your customers will have a high CLV (Customer Lifetime Value). Provided that you offer high-quality customer service, your customers will stick with you for as long as you are in business.
Best Reseller Hosting Providers
Cloudways is a cloud hosting platform that delivers fully managed hosting and allows clients to launch web applications on different cloud servers.
- Free SSL;
- Free Migration;
- Dedicated Firewalls;
- Regular Security Patching;
- Optimized with Advanced Caches.
A2 Hosting is one of the oldest and most popular web hosting companies. It has five hosting plans, including shared hosting plans, managed WordPress hosting plans, VPS, dedicated hosting, and reseller hosting.
- Website Staging;
- Remote Backups;
- DDoS Protection;
- Unlimited Bandwidth.
HostGator is one of the cheapest website hosting providers in the website hosting industry. It has three web hosting packages: Hatchling Plan, Baby Plan, and Business Plan, all of which offer free domain registration and free SSL certificates.
- Ad Credits;
- Unlimited Storage;
- SiteLock Monitoring;
- Easy App Integration.
Bluehost is a web hosting service that powers over 2 million websites all over the globe. Not only does Bluehost offer web hosting services, but it also offers SEO services such as content creation, marketing training, and graphic design. Bluehost has four hosting plans: Basic, Plus, Choice Plus, and Pro, all of which offer custom themes, WordPress integration, and round-the-clock customer support.
- Free SSL Certificate;
- Free CDN Included;
- AI-Driven Templates;
- Drag and Drop Functionality.
If you are looking to save a few coins, you can get a 63% discount when you purchase a plan from Bluehost by clicking our link.
SiteGround is a web hosting provider that currently hosts more than 2 million websites around the world. SiteGround offers WordPress Hosting, WooCommerce Hosting, and Cloud Hosting, and it has three shared hosting plans:
- Free SSL;
- Free CDN;
- Free Email;
- Managed WordPress;
- Unlimited MySQL Databases and Data Transfer.
Start Using Reseller Hosting Today
Reseller hosting allows you to package and sell hosting without bearing any infrastructure costs, at your own price, and under your own brand. It is the perfect solution if you want to extend your range of services or if you are looking to supplement your income.
If you plan to resell hosting with a reseller hosting package, remember that you need to build your hosting services, set your prices, configure the billing system, support your customers, and focus your marketing efforts on a specific niche.
We have also highlighted five reseller web hosting partners from which you can choose that have the best hosting plans. If we had to choose one, we’d choose Cloudways. With super fast hosting and excellent customer service, it’s our preferred hosting provider for reselling.