Starting with VPS is a clever idea, VPS is a good option over the Dedicated servers, over the time if you need the best performance and more space with more cache, you can go with the dedicated servers

If you website start, you can use VPS/Reseller/or normally webhost..
if web server do not speed for your website, you must invest to dedicated

If you have a pre-established website and have high traffic,you can opt for a Dedicated server.But if your website is new and there isn't much traffic to it,then a shared or VPS would be just fine.A shared/VPS are much cheaper than a dedicated server,hence there would be a waste of money if you are not utilizing the resources allotted to a dedicated server.Later when your website starts receiving high traffic and the resources required to run the website smoothly,starts falling short,you can think of upgrading to a dedicated server.

VPS has its own resource limitation and as traffic increases you might require to go in for Dedicated hosting.
Regarding when do move from VPS to dedicated, i guess you must have figured it out when you moved from shared to VPS

It all depends on your need.

If you know eventually you will need to upgrade maybe starting with a dedicated server is better.

I would consider upgrading to a dedicated server when I felt that the VPS was becoming too consumed.

The best way to figure it out is to look at your resource utilization within your server or control panel. If your using cpanel/whm, you can easily find this info. Then you can establish what resources you will need, and that can in most cases determine if you need a VPS or an entire dedicated server.

Start with a VPS and upgrade as you need. Once you can't upgrade anymore get a dedicated server.

This is very true. Start with a VPS and upgrade untill you cant get any bigger than the biggest Hybrid Server. Then upgrade to something like a Quad Core.

- Many Thanks,

For me, VPS is indeed a great start for your small-medium sized business on the internet. We should apply this before we involve to the dedicated server.

I think if your requirement calls for multiple VPS then it is much cheaper to get dedicated server and host your own multiple VPS.

I think it all depends on the platform you're hosting your VPS on. We have multiple clients that switched from a dedicated server to a VPS because they were looking for the flexibility and scalability that a VPS can offer that a dedicated can't.

If you are worried about resources being oversold or exhausted on the VPS server, opt in for a plan that has guaranteed resources.

When you need more than your shared resources on that VPS.

If you started out with a VPS, and kept on upgrading it as needed, eventually you would end up with the only VPS that fits on the host. At this point it would be worth considering switching to dedicated, but even then there could be some compelling reasons to stick with the VPS.

The difference between a dedicated server and a server running one VPS which is allocated all the resources would simply be the overhead of virtualization itself, and there might be some value in reclaiming those few percent. However, at this stage you already have a very large VPS that has obviously done well for you and got you this far, so it might be better to stick with what you know works rather than chasing a little performance.

Another aspect is cost. It is actually easier for a hosting provider to manage VPSs than dedicated servers. Providing backups is certainly easier, as well as upgrading you to newer hardware as appropriate, or onto a spare host should there be a hardware problem. If it is easier then it is probably cheaper. I would expect a VPS plan so big that it would take up a whole server to be cheaper than renting that server directly (assuming the hosting company uses its own equipment of course).

As virtualization gets better the advantage of direct access to the hardware becomes outweighed by the convenience and cost reduction of managing a virtual infrastructure. Of course if you have unusual requirements such as lots of one resource (disk/memory/cpu), then being shoehorned into a typical VPS package just might not make sense. There is a lot to be said for the flexibility you get with dedicated/colocation. If you don't need that level of customization then I see little sense in not going with a VPS.

Jim