You’ve probably seen “reseller hosting” advertised on a few web host sites, but may not know what it means. Depending on your entrepreneurial spirit and goals, it might be a fantastic source of income! Most commonly linked with virtual private server/VPS hosting, this is a type of web hosting where you—the account holder—can use the hard drive space/bandwidth allotted to you and “resell that hosting” to someone else. Imagine this: You’ve opted for VPS hosting, but you have much more hard drive capability and bandwidth than you need. After all, VPS hosting is now extremely affordable, and all you’re doing is hosting a simple website. Why not capitalize in what’s yours and turn a profit?
As a reseller, you get wholesale prices from your web host, then resell as you see fit. It’s just like how wholesale pricing works in other retail industries. In web hosting, some resellers get a profit, others break even, and still others just want to minimize their loss while they build websites on the backend that they’ll later need. As a reseller, you can also rent a dedicated server from your host, but this is very expensive. Reselling shared hosting is also plausible, but not as more and more people (like you) understand the benefits and affordability of VPS hosting.
What’s More Profitable?
There are two major possibilities for reseller hosting. With dedicated hosting, you’ve actually bought a server (likely to the tune of six figures) and are just paying a data center (which is often operated by web hosts) to maintain it for you. In this scenario, you’re truly selling or “re-selling” disk space and bandwidth to someone else. With shared basic plan and VPS hosting, you’re really just subletting disk space and bandwidth—although it’s still dubbed “re-selling.”
Just about anyone can be a reseller, but the most common resellers are web developers, owners of a web design company, and systems integrators who see web hosting as a sweet a la carte service their customers will enjoy. Plus, reseller hosting is a backdoor entrance to becoming a web hosting entrepreneur with minimal capital and risk. There are some successful reseller hosts who began as teenagers! You can make your own service plans, choose your price points, and create your own branding with personalized servers and control panels.
Since reseller hosting is almost identical to the traditional wholesaler/retailer arrangement, it’s pretty easy to see how it works. The inner workings might sound very technical, but keep in mind that reseller hosting doesn’t require a master’s degree in IT. The data center manager (“your” web host) is the one in charge of taking care of the hardware, infrastructure, updates, etc. You simply have to find customers and interact with them on a retail level. Leave the hardware/software issues to your web host.
Where you do need to shine is in advertising, marketing, and customer service. This is a low-margin industry, so it’s all about quantity. The good news is that everyone needs web hosting if they want to have an online presence. The bad news is that there’s a lot of competition. Are you up for the challenge?