How To Resell Web Hosting

I always think a web design business should expand the services it offers. One obvious way to do this is to resell web hosting services to clients.

resell web hosting

So, what do you do? Purchase a Hostgator Reseller Account (affiliate link), charge your clients, sit back and watch the money come in? Right? Wrong!

I’ve been offering hosting services to my clients for years and this is NOT an easy way of making passive income. However, with the right systems, contracts, pricing and billing in place, it can be a mutually beneficial operation for you and your client.

Choose the right host

As you will be reselling the servers of an existing host you must choose a long-established host with a great reputation. Personally, I use one shared host to resell from: the Hostgator Reseller Account and one VPS host: Dreamhost VPS (both affiliate links). My shared hosting packages are cheaper as the hosting can be slower although, with Hostgator, I haven’t had many problems.

Read my articles on the best shared hosts for WordPress and best VPS for WordPress for other reliable hosts whose services you can resell.

Once you have the hosting set up it is extremely important that you put one of your own websites on the host you are reselling. See how you get on with this host. If you are using WordPress, see how it handles WordPress, plugins, caching, etc. If you are using this host adequately yourself you can then sell their hosting services.

Be clear to your client about the service you are offering

Remember, if something goes wrong with the hosting, you will be expected to put it right. Potential pitfalls can be avoided by perfect prior communication and hosting best practices.

Here are some of the many lessons I’ve learned while providing hosting services to clients:

  • Downtime. All hosts have downtime and it’s important that your clients realise this. Thankfully, most downtime last for a few minutes but it’s important to choose a good host with good support so that you supply information about the downtime if it occurs. Use Pingdom to monitor this.
  • Scale. A set amount of disc space and bandwidth should be discussed and agreed upon.
  • Email. Use Google Apps for Business to route the email. You can charge a set-up fee for this and make sure your client understands that there will be ongoing fees if they exceed the 7.5 GB storage ceiling or require more than 10 email accounts.
  • Maintenance. Bundle in your website maintenance with the hosting fees. It is in your interest to keep backing up and updating WordPress installs and plugins. If this is all done regularly there will be less problems. If you leave this to the client, it might not get done.
  • Termination. Tell the client that they can terminate the contract or agreement at any time. But if this happens, either they arrange for the site to be moved or they pay for you to do so. Liaising with another host and moving a website can be a time-consuming process.

Domain name registration

I usually prefer the client to arrange the domain name registration but, if they prefer me to do this, I will.

Pricing and Charging

The price should be charged monthly or annually and should be paid by the client in advance, preferably via automatic transfer.

You should charge the client at least double what you are paying the host. So, if the reseller hosting costs you $30/month, you should charge the client at least $60/month for hosting and maintenance. This is regardless of how many other clients you have on the same server.

What you can do

Put together a plan for potential clients and what you could offer them. Remember to set the price with the worst case scenario in mind. Always use a hosting service that you have had lots of experience with. Find out more about how to run your own web design business from home in my e-book.

Do you resell hosting services for your clients? What are your experiences? I’d love to hear about them in the comments.

Comments

  1. says

    Good sound advice Rob, like you I provide a similar service to clients. I promote the benefit of a personal service as opposed to the telephone or ticket service provided by multi-nationals.

    • says

      Yes, Peter, with the reselling packages on offer you are supposed to give the client the cPanel login and let them get on with it. But my clients wouldn’t like that and I give a total personal service, like you do.

  2. says

    Great post. I host for my clients as well. Going on 10 years now. I like the Google email point. People have no idea what a pain email on a server is like. I spend more time messing with email/black lists than I do with support.

    • says

      Yes, I had an email blacklist nightmare before I discovered Google Apps for Business. Email routed through a shared server is not a good idea! I bet you could write a better article than this after 10 years of experience! Thanks for your comment, Douglas.

  3. says

    One question I do have is for the clients you charge, does your pricing plan differ on size of company and what they want. I mean, if you say its $60 a month but that includes your service for backup, maintenance, etc then you not really selling it as a hosting service but more as your service with hosting.

    Is there a price you would say is reasonable for if they only wanted the hosting and to maintain themselves or don’t you sell that way.

    Also, I presume in this method your setting up a new hosting for each customer and not using a hosting reseller account? Are their any reseller accounts you have checked out and would rate (although all the ones I have seen are cloud based, which is fine for simple webpage I presume).

    • says

      You’re right, Sean, I tend to charge for maintenance as well as hosting and charge more than I would for just hosting. I find my clients don’t want to get involved with the hosting so much so I don’t sell just hosting.

      I never set up new hosting for a client. I always use an existing reseller account or VPS account and put them on that.

  4. jithendra says

    Thank you for your insights rob, i am thinking of starting my own business and your articles were truly helpful. :)

    God bless you.

    Regards,
    Jithendra

  5. Jayr says

    Web hosting is a great business model because of the recurring fee.

    I am still taking a web design course and I will definitely offer hosting service to my future clients if possible.

    The only task I know in cpanel are uploading files, doing wordpress installation and creating emails. I can’t handle hosting configuration and fixing errors.

    Is it okay to offer web hosting service to your clients even if you don’t have a server and technical knowledge?

    I just bookmarked this page for future reference.

    Thanks Rob.

  6. says

    Hi Rob,

    This is a very valuable information. It’s like you are having an eBook here in your own blog. I bookmarked every single post you have regarding Reselling Hosting Service. I am definitely spearheading in this direction. And so I keep reading and researching this area, until I feel comfortable enough to start doing this.

    I am not done reading your eBook “Running A Web Design Business.” There’s a lot to absorb. And I keep getting distracted from a lot of eBooks I purchased from Steve Scott, Chris Gutrie, and Derek Doepker. Yeah, I just purchased Derek’s “Kindle Bestseller Secrets”…I want to write a book before the end of this year. And before the end of this year, I would have established this “special deal” package on my website. Startup my eStore…

    So many things I wanted to do. I know that it will take time to do all this. But these are my goals this year. This post helps me a lot. Thank you so much for posting this.
    I am seriously considering Hostgator to be my Reseller Hosting Service because I have experienced so much positive results from them. Their customer service is SUPERB and I couldn’t be more happier.

    Angela

    • says

      Hi Angela, yes, I’m writing Kindle books as well at the moment. Steve Scott’s got a lot to answer to!

      Best of luck with all your projects. I know it can be hard to know what to focus on but if you’re loving it then it’s all good!

  7. says

    Hi Rob
    Reselling hosting sounds a little daunting. With all the reported increase in downtime I have been hearing lately. But as someone who is working towards starting a web design business it is something to think about.
    Do you by the way know/recommend any good Europe based web hosting for wordpress?
    thanks
    ashley

    • says

      I agree, Ashley, this is not something to be entered into lightly. And you’re absolutely right the previously solid hosts in the US seem to be falling short recently. However, in the UK at least, I have no problem recommending Vidahost (that’s my affiliate link) – they’re a smaller company but I really have had no complaints in years of using them. I host this site with them.

      Generally speaking you have to really trust the host and remember email is even more difficult to manage so try to avoid that if you’re just starting out.

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