Leverage is everything when you’re starting a new business – whether that’s a new full-time operation or just a side hustle.
And while there are plenty of business opportunities out there that offer a lot of leverage, none of them offer quite as much as a reselling web hosting services. Especially right out of the gate.
About as turnkey a business opportunity as you’ll find today, it’s possible to hit the ground running with a reseller hosting package and start making $100 a day (or more) inside of your first 30 days. And thanks to unique scalability opportunities reseller hosting offers, the sky is the limit when it comes to maxing out your passive income with this kind of business.
If you’re thinking about diving headfirst into the world of web hosting reseller opportunities but aren’t quite sure of where to start – or how to start – we’ve put a lot of the pieces to the puzzle together for you in this quick guide.
Why resell web hosting services?
Each and every day, thousands and thousands of businesses and entrepreneurs are looking to build new websites and all of them have to start with a web hosting package. Designing and developing a new website is one thing, but a website will NEVER go live until it is placed on a web hosting service.
And that’s what makes the web hosting such a lucrative operation, and a big part of why becoming a reseller of web hosting packages offers you so much leverage.
As a reseller, you’ll essentially be purchasing storage space and bandwidth established web hosting servers and then packaging it up to sell to individual clients. You’ll be offering all the same services that traditional web hosting companies offer, but because you are a reseller you won’t have to handle any of the technical heavy liftings when it comes to maintaining, improving, or optimizing of that server.
Bottom line – You get all the benefits of offering web hosting to entrepreneurs desperate for this service without any of the downsides of having to run or maintain a full-blown web hosting operation.
It doesn’t get much better than that!
Covering the ABCs of Becoming a Web Hosting Reseller
It’s absolutely impossible to have any success in business today without having an active online presence, and that means – at the very least – having your own business website set up.
While it may be very exciting to have your own website designed by a professional web designer, it can also quickly turn out to be a very costly affair. A good website, that is responsive – works seamlessly across all devices, adheres to modern web 2.0 standards can easily cost upwards of $2000, to begin with. I don’t recommend spending that amount of money on a website when just starting out. Instead, go to ThemeForest, do a search for web hosting templates and you will have an entire list of extremely well designed professional themes and templates that you can easily customize for your brand. The average price for most well-designed themes in Themeforest is around the $45 mark.
Pro Tip: Look for a theme that has a WHMCS compatible template accompanying it, such as the Hostio Theme.
The Billing System
Now that you have a brand spanking new website, we will need a CRM or a billing system to go along with it. A billing system will process your orders, automatically set them up, do the recurring billing, all without you having to spend hours each day creating new invoices, sending them to your clients and following up for payments. The de-facto tool of choice for the entire web hosting industry has always been WHMCS.
WHMCS or Web Host Manager Complete Solution, is an all in one automated client management, billing, support platform specifically designed for web hosting companies. It handles everything from signup to termination due to non-payments. Host4Geeks is an Authorized WHMCS Partner and we bundle a free WHMCS license with our Premium Reseller Hosting plans. If you were to purchase a license directly, it starts at $18.95 /mo and changes as you grow.
Installing, setting up and customizing WHMCS is beyond the scope of this post but you can find a lot of helpful information on our knowledgebase.
You will be using the accompanying WHMCS theme bundled with your purchase from Themeforest, to get the WHMCS interface to look like your website.
The Business Plan
The next thing you’ll need to become a web hosting reseller is a business plan to start gobbling up as many customers and clients as possible, as inexpensively as possible so that you can start bringing money into your new bootstrapped business.
Because of the web hosting world is so competitive you’ll have to come up with a hook or Unique Selling Position that attracts customers that have an almost endless amount of options to pick and choose from.
Maybe you want to offer more resources at a better price, maybe you’ll want to offer optimized hosting packages specifically for different niches or industries, or maybe you’ll want to do business specifically with only brand-new online entrepreneurs or established veterans.
How you find your hook is entirely up to you, but in as crowded and cluttered a market space as the web hosting world you’ll absolutely need one to succeed.
The Reseller Hosting Plan
Secondly – and only after you come up with your competitive advantage – you’re going to need to look for an actual web hosting reseller account you can sign up for.
There is a plethora of option when it comes to web hosting companies out there offer reselling packages, which means tracking a new account down isn’t going to be all that difficult. But not all are made equal. Your reseller hosting plan is the core, the backbone of your business and you want this to be firmly reliable and stable, after all, your business and your reputation depend on this. We have an infographic guide on how to choose your reseller hosting provider that covers the most important pointers that you should look for when choosing your reseller hosting provider.
Just make sure that you are choosing a web hosting platform that can offer the deliverables you are promising with your hook or competitive advantage. You want some flexibility to be able to offer your clients and customers something special, and you also want to only partner with web hosting operations that have a rock solid reputation as far as technical service, support, and uptime are concerned.
The Payment Gateway
A payment gateway is going to be necessary to run and operate your reseller business. You can get started with something as simple and as straightforward as a PayPal Business account, but once you start to move real volume you’ll want to look into a more robust merchant account or payment gateway. There are plenty of options to pick and choose from (with pros and cons for each), and that’s something you’ll have to figure out later down the line.
Look for a payment gateway that either already integrates with WHMCS, your billing software or offers a WHMCS integration. Take a look at our listing and comparison of the best payment gateways for a web hosting company.
A Couple of Tips and Tricks to Help You Hit the Ground Running
While you’ll definitely be in the web hosting business when you start up this kind of operation, at the end of the day the most important thing you can focus on personally is the marketing and advertising of your operation.
Everything else (and we mean EVERYTHING else) can be outsourced reliably, even to overseas virtual assistants or agencies, but the lifeblood of your company – and the foundation of your success – is going to be entirely dependent on your ability to bring in new customers and then keep them for as long as possible.
Bootstrapped entrepreneurs are going to want to look for inexpensive ways to hit the ground running, and a great way to boost cash flow right out of the box is to partner with web designers and developers in your local area that are obviously going to need hosting packages for themselves and all of their clients.
These are the kinds of initial clients you can hook up with pretty easily (especially if you’re willing to cut them in on a great deal) that can push a ton of business your way, generating a lot of positive cash flow almost instantly that would have been hard to drum up otherwise.
Traditional marketing and advertising approaches aren’t a bad way to go, either. Paid advertising – particularly PPC advertising – can be incredibly effective, as long as you carefully track your metrics and focus on conversion optimization.
Joint Venture opportunities (partnering with search engine optimization agencies, online marketers, and the like) can be another approach to take. You’ll be gaining instant access to a flood of potential customers you might not have had access to otherwise, opening up the door to a lot of leverage that can boost and build your business faster than you would have thought possible before.
How to Build and Grow Your Reseller Hosting Operation
At the end of the day, building and growing your reseller hosting operation is going to be a lot easier than a lot of people make it out to be.
To begin with, your costs when you purchase your storage and bandwidth from a hosting provider are going to be fixed. This gives you a lot of flexibility as you’ll know exactly what your expenses are going to be right out of the box, and because you will be able to create the packages and plans you offer your clients you’ll be able to control how much profit you add on every package.
New resellers regularly find it easy to sign up a hundred clients or more in their first month of business, especially when they joint venture with already existing operations with a built-in customer base or local web developers.
That’s just three new clients for you every day for a month, and if you’re charging $10 a month for web hosting packages through your reseller account and signing up just 10 users daily you will be bringing in $3000 a month – or just over $100 every day.
As you can see, this is the kind of business opportunity that gives you every opportunity to make a mountain of money in a hurry and without a lot of upfront expense on your behalf, either.