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  Post #1 (permalink)   06-21-2007, 12:52 PM
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In the majority of the hosting related forums that I read, there is always a post about how someone should start their hosting business. Usually there are a few responses about starting out as a reseller, getting the right billing software, being patient, advertising your business online, etc.

All these things are nice to know, but the truth is you don't need them.

Yes you should start your business as a reseller, especially since it's more cost effective for the new web host.

But, don't make the mistake that so many others are currently making by chasing after the cheap hosting market. It's crowded, there's too many customer service issues, it's expensive to market... There are just too many issues with that particular market segment to make it worthwhile.

So here is a business model that actually does work, provides the owner with continuing income, and has less than 1% of the customer service issues.

1. Get yourself a reseller hosting plan from a reputable hosting provider.
2. Put up a single page website that says something similar to this:

As a small business owner, shouldn't you be spending time running your business instead of dealing with the daily hassles of keeping your website online? Wouldn't you rather be spending your precious free time with your family and friends, instead of dealing with another headache?

Look, I know how you feel. i am, after all, a small business owners myself. That's why we provide only custom, fully managed website solutions at a price you can afford. (less than a $1.50/day)

Yes, there are cheaper web hosting companies, but then again, you're back to spending your time doing everything yourself, instead of spending your time doing what you want or need to do.

To find out what "my company name" can do to help you, just call me at:

Name
Phone #

I'm usually available been 9am - 5pm, unless I'm meeting with other business owners like yourself. So if I'm not available, leave a message and I'll personally get back to you shortly.

3. Give free hosting for 90 days to 10 local business owners. Provide an exceptional level of customer service. As I stated in another post, at 30 days, contact each one of them and ask for suggestions and feedback. At 60 days, do it again, and inform them that their free hosting is due to expire, but you'd be willing to extend it for another 90 days, if they would recommend your custom managed hosting to their business associates. Tell them that for every 3 paying customers they recommend, you'll extend their free hosting for 90 days.

4. Create a custom hosting plan for each individual business. Since it's a managed hosting plan (ie: you'll be adding email addresses, uploading their website for them, making minor changes as asked, etc), you'll be able to charge a premium hosting fee of $30, $50, $75 dollars a month or more. Collect a check for a full year of hosting in advance.

5. Maintain a high level of customer service with your existing customers.

6. After you're able to quit your day job, set specific hours of operation, and live by them religiously.


With this business model, you don't need a server (just a reseller account), billing software (use an excel spreadsheet), or 90% of the other junk you see people promoting. If you want to hire a designer you can and that would be a good additional income stream.

Value added service is where the money is in this business.
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  Post #2 (permalink)   06-23-2007, 06:31 PM
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No model works for everyone.. If everybody used that model, then soon enough it would be useless as it eliminates any uniqueness amongst hosts..

You need to also consider that you move into many different segments of hosting. You have simply stated a small niche..

Not to mention, that is all easier said than done..
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  Post #3 (permalink)   06-23-2007, 07:42 PM
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I think the 2nd post explains the title more than the 1st.
 
 
 


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  Post #4 (permalink)   06-23-2007, 08:15 PM
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I have a three word system that works for ANY hosting reseller.

Find a niche.
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  Post #5 (permalink)   06-25-2007, 02:52 AM
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I totally agree with the first post. In fact i am going to try it. To be honest as the saying goes "nothing ventured, nothing gained". So why not? Currently i do this type of managed hosting for a chartered accountant and it works well! Other people should follow and find their niche.
 
 
 


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  Post #6 (permalink)   06-25-2007, 02:53 AM
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But..... then we have to remember that there are those of us who probably would never try something new or live on the edge. May be only pray for those who miss out on all of lifes wonders ;-)
 
 
 


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  Post #7 (permalink)   06-25-2007, 01:05 PM
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Quote:
Originally Posted by stealthdevil
No model works for everyone.. If everybody used that model, then soon enough it would be useless as it eliminates any uniqueness amongst hosts..

You need to also consider that you move into many different segments of hosting. You have simply stated a small niche..

Not to mention, that is all easier said than done..
While it may be true that no model works for everyone, this model does work. It provides a service to a specific group of business customers that want their site to "just work" without them having to learn all the ends and outs of hosting. That way they can focus more on their business instead of this particular part.

Yes it is a niche. But if you want to survive in business today, you need to find your niche.

I'll be honest with you...of course it isn't easy. Nothing worthwhile ever is.

And I never said that everyone should use this model. Most people are more interested in chasing what they consider the "fast buck" so they go for the cheap hosting market. They don't realize (or don't care about) the # of customer service issues that they are going to end up with.

The model I described allows the business owner to actually have a life that doesn't revolve around their hosting business.

You've been in business for awhile, and I respect that. But to be honest with you there is very little unique about 99% of the hosting companies out there today, so overall your point is moot. Sorry mate, but it's the truth.
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  Post #8 (permalink)   06-25-2007, 01:37 PM
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There's some interesting stuff in this post, for sure.

I wonder how targetting business customers who just want their website to work so they can forget about it and also asking them to talk about it in terms of referrals work together. Presumably, if you're doing your job and the customer never has to think about their website it will never occur to them to mention it

Just pondering...
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  Post #9 (permalink)   06-25-2007, 11:03 PM
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Quote:
Originally Posted by hostnola
While it may be true that no model works for everyone, this model does work. It provides a service to a specific group of business customers that want their site to "just work" without them having to learn all the ends and outs of hosting. That way they can focus more on their business instead of this particular part.

Yes it is a niche. But if you want to survive in business today, you need to find your niche.

I'll be honest with you...of course it isn't easy. Nothing worthwhile ever is.

And I never said that everyone should use this model. Most people are more interested in chasing what they consider the "fast buck" so they go for the cheap hosting market. They don't realize (or don't care about) the # of customer service issues that they are going to end up with.

The model I described allows the business owner to actually have a life that doesn't revolve around their hosting business.

You've been in business for awhile, and I respect that. But to be honest with you there is very little unique about 99% of the hosting companies out there today, so overall your point is moot. Sorry mate, but it's the truth.
If everyone uses this model, it loses its appeal. Hosts have to differentiate. While that model could work, if too many people use it, then it won't work at all..

All I'm saying is that you cannot present a certain model and claim it will work. Too many variables to consider which cannot be kept at levels you would like them to.
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  Post #10 (permalink)   06-26-2007, 05:46 AM
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i think everyone has its own different model, Thus to follow one is not recommended at all. Use your own mind, resources, & network to run your business.
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  Post #11 (permalink)   06-26-2007, 06:24 AM
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As a business owner, I wouldn't want to be pestered by my host to recommend them to other people, either. I'd rather pay my bills as a legitimate expense and forget about my hosting.

I don't know...maybe it's just me...but offering free hosting for referrals seems like something a person, rather than a business, would be more interested in.
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  Post #12 (permalink)   06-26-2007, 11:19 AM
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Quote:
maybe it's just me...but offering free hosting for referrals seems like something a person, rather than a business, would be more interested in.
It does seem so, but you don't need all your customers (businesses) to be recommending your service. A few will do as long as they've got the connections and inclination to do so. Small businesses are often enough little more than a person.
 
 
 


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  Post #13 (permalink)   06-26-2007, 11:50 AM
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Very true. There are many small, small businesses...
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  Post #14 (permalink)   06-26-2007, 12:39 PM
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Quote:
Originally Posted by hostingpuppy
There's some interesting stuff in this post, for sure.
Yes there is

Quote:
I wonder how targetting business customers who just want their website to work so they can forget about it and also asking them to talk about it in terms of referrals work together.
Actually, it does work all the time. Joe Business Owner, when asked by a fellow business owner who he hosts with, will refer your hosting company. He'll promote it better than you think.

When I did this...

Out of 10 free customers initially, on 2 ever referred business for free hosting. One was a real estate agent, and the other was a local contractor. The other 8 went ahead and paid. But those 2 customers brought in over 50 other business owners who paid my regular rates. Plus some of my other customers would refer other business owners to my service. It worked out well and after 1 year I had over 200 customers paying a premium fee of a minimum of $35/month. Some were more.

It all depends on the service you provide.
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  Post #15 (permalink)   06-26-2007, 12:47 PM
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Quote:
Originally Posted by stealthdevil
If everyone uses this model, it loses its appeal. Hosts have to differentiate. While that model could work, if too many people use it, then it won't work at all..
The model does work. I agree that if too many people start using it in smaller areas it won't continue to work. But if you live in a large metropolitian area (especially metro areas like Dallas, Houston, Los Angeles, etc), it will work, for a long as you desire to pursue it.

And how are the vast majority of hosts differentiating their business from their competitors now? By adding value added services. If it wasn't for value added services, it wouldn't really matter who you hosted with. Almost everyone's prices are the same in the cheap hosting arena.

Quote:
All I'm saying is that you cannot present a certain model and claim it will work. Too many variables to consider which cannot be kept at levels you would like them to.
All I'm saying is to investigate a different business model than the one the vast majority of people pursue. If you're doing your due diligence prior to starting up a hosting company, then you will know whether your local business climate can support it. If you live in a small town of less than 100k people, then it may be tougher. As a business owner you have to decide what can work for your business.

But you cannot tell me that this business model doesn't work. Because I know it does.
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