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  Post #1 (permalink)   01-17-2008, 01:58 PM
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I've been running a web design business for a couple of years and have offered hosting as a part of the service to make it an all in one service. But I see a lot that people offer reselling without any other service, and I am not really sure how that would work.

I can see from the point of view of the reseller that you would make a profit by selling on small chunks of your hosting. But for the person buying, what are the advantages? Could they not find cheaper hosting (from the prices I have seen reselling packages going for) by buying their own hosting?

I don't mark up my hosting, so don't make more than pennies profit, so can you tell me-does this really work?
 
 
 


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  Post #2 (permalink)   01-17-2008, 03:57 PM
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Quote:
I don't mark up my hosting, so don't make more than pennies profit
Interesting. From what I noticed, web designers who offer hosting manage to use some really high markups, and also manage to sell packages that are quite small. I guess it all depends on them putting their message in front of the right people.
 
 
 


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  Post #3 (permalink)   01-17-2008, 06:58 PM
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That's a smart observation, but reseller hosting still represents a major chunk of the whole industry. In my opinion, it all comes down to how good a marketer you are.

If you know how to reach local businesses in a smart and cost-efficient way, then you will sell your services well. On top of that, resellers who go exclusively after their local markets usually price their services higher in order to earn more.

Chances are local businesses are not technically savvy, so they won't go on research rampage. Most of them care more about where you are geographically (same town, community, etc) than the number of POP3 email boxes you'll offer them. I have seen companies pay as much as $25-75/month for 25 MB of space and 500 MB transfer allotment to this day.
 
 
 


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  Post #4 (permalink)   01-17-2008, 07:27 PM
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There are a few reasons why many people are willing to pay more for reselling than what you would expect. I think the most likely reason is that people buy the resold hosting expecting some services that are not included. The other reason could be that people do not do their research. Many new webmasters see a post saying "UNBEATABLE PRICES" and the think, wow.. that must be a great deal. So they end up paying more than they should. Like they said, it all comes down to marketing.
 
 
 


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  Post #5 (permalink)   01-19-2008, 01:45 AM
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Thank you for the answers. I have never been that good at marketing which might be why it never occured to me to try this. I am curious though, what services might they expect to be included?

Also, when a problem arises with the hosting, does the lowest level client contact the reseller, who then submits a ticket to the host or do they contact the host directly? In which case, what are they paying the reseller for?
 
 
 


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  Post #6 (permalink)   01-19-2008, 07:46 AM
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Quote:
Originally Posted by AbbieRose View Post
Thank you for the answers. I have never been that good at marketing which might be why it never occured to me to try this. I am curious though, what services might they expect to be included?

Also, when a problem arises with the hosting, does the lowest level client contact the reseller, who then submits a ticket to the host or do they contact the host directly? In which case, what are they paying the reseller for?
The reseller contacting the host may the most common process used. Many times, though, the reseller not only acts as a go between, but as a quality assurance service. A good reseller will be able to diagnose and resolve some problems without going to the host. In other cases they may simply be good at marketing and serve little more than as a conduit with support issues.
 
 
 


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  Post #7 (permalink)   01-19-2008, 06:46 PM
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Most reseller hosting providers will support the reseller, not his customers, and will expect the reseller to actually handle most of the customers inquiries himself, and ask for help when his own knowledge is surpassed by the complexity of the problem.

There are however reseller hosting providers that provide so called end user support, and actually have things setup so that the end user can't find out it's a third party that provides this support. There are not so many providers of this kind though.
 
 
 


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  Post #8 (permalink)   01-22-2008, 10:28 AM
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Given that many companies won't deal with end users, would you say that it is only reasonable for resellers to have a high level of technical knowledge, at least as far as hosting, CPanel and so on are concerned?

I personally manage every aspect of my client's sites and so technical issues are normal picked up by me. But for others, are there many not so tech mined resellers out there?
 
 
 


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  Post #9 (permalink)   01-22-2008, 08:58 PM
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Unfortunately, there are too many resellers that are not adding anything to the product, they're simply acting as a conduit when it comes to support.
 
 
 


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  Post #10 (permalink)   01-22-2008, 09:02 PM
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Sadly, everyone is correct. The problem with resellers is that they do not have support and do not (usually) cater to the customer. Web hosting was not originally a free for all, but now in the world of resellers you never know what you will get. Its just another reason to research before you buy!
 
 
 


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  Post #11 (permalink)   01-24-2008, 08:23 AM
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I agree. Research is key to success. Additionally, a good web host will have a 30 day money back guarantee, which allows you to try out their service. Even if they don't it's better to pay for a month to try it out before fully committing and moving all of your domains.
 
 
 


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  Post #12 (permalink)   01-25-2008, 09:57 PM
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Quote:
Originally Posted by SoaCahToa View Post
but now in the world of resellers you never know what you will get.
Unfortunately I do not think that it is just the world of reselling that experiences this phenomenon. I have experienced my own severe problems with hosts and honestly have come to the conclusion that the hosting world is cut throat through and through.
 
 
 


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  Post #13 (permalink)   01-26-2008, 06:32 PM
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Unfortunately I do not think that it is just the world of reselling that experiences this phenomenon. I have experienced my own severe problems with hosts and honestly have come to the conclusion that the hosting world is cut throat through and through.
I think you may well be right, AbbieRose. The problem I found with one particular host that I used for a few years was that while they offered a good service in the beginning when they were small and could give more personal attention, the bigger they got the more the service deteriorated.

Shame really, because the reason they got so big was because they had built a good reputation and word spread. I think they grew too fast and bit off more than they could chew unfortunately and were victims of their own success.
 
 
 


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  Post #14 (permalink)   01-27-2008, 05:18 PM
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The majority of our resllers that I've spoken to over the years are Web Designers or Applications Developers, who want to be able to manage the resources and setup for each site themselves.

But I do know one who simply buys a 90/month reseller package and has split it up into 230 10/month packages for local business etc and acts simply a s a "go between" us as the actuial provider and the end-client.

In that respect its no different to having a house and renting each room out ...
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  Post #15 (permalink)   01-27-2008, 11:55 PM
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It really is a shame when the little guys lose their respect for the customers who make them big. One can only hope that as their reputation starts to slip that they start to realise once again what is important.
 
 
 
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