As e-commerce habits continue to expand across the globe, more and more people are creating online businesses to increase their reach. All of these potential website owners need web hosting in order to start. With so many people searching for internet real estate, there is a market for creating a business that to provide these web hosting solutions. This is where white label hosting comes in. With White label hosting you create a Hosting company from scratch or add it to your existing business if you are a web developer.
In this article we are going to breakdown everything you need to know about white label or reseller hosting.
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The 411 on White Label Hosting
White label hosting is also commonly referred to Reseller Hosting. This is a hosting platform specifically designed for small to large business owners who wish to offer hosting services to their clients.
In reseller hosting a business owner simply rents hard drive space and bandwidth from an already established hosting provider. Specifically, the renter (or reseller/ business owner) then advertises and resells hosting packages to third parties. This kind of hosting allows resellers to provide clients with web hosting solutions, as though they themselves were the hosting supplier. It’s as simple as that. A reseller company gets the right to personalise and sell hosting solutions without ever physically touching the product.
The best hosting companies, give customers the ability to pay a single monthly fee for a main account. Then, customers create “resold” or “sub accounts” from this main account. How many you are able to create, depends on which hosting plan you chose and how much disk space and bandwidth you need.
Each account you create is a fully functional shared hosting account. Reseller packages are therefore like buying multiple shared web hosting accounts – only much cheaper and a whole lot simpler!
When you buy a reseller hosting package, you can use the resold/sub accounts for any purposes. (i.e. you do not have to resell or become a reseller, these packages can also be used to host multiple websites of your own.)
Who is White Label Hosting for?
Anyone can start a reseller hosting business.
All you need is web space, purchase your own reseller package and congratulations you will have taken your first step towards starting a reseller hosting business.
White Label hosting is often used by small to medium sized businesses that want to make money by renting out hosting space to entrepreneurs and smaller businesses.
It is a great option for developers and designers who want to provide a more complete package for their clients. It’s also a path some entrepreneurs like to take when they decide to diversify their brand. In the end, anyone can start a reseller hosting company.
Pros and Benefits of White Label Hosting
Let’s begin by discussing all the benefits and pros of white label hosting. If you are a Web developer, or run a tech website or agency, reseller hosting may be the stepping stone to expanding your business and offerings to your clients.
Utilising a reseller hosting package can give your brand some great advantages. You will effectively become a hosting company, making money from website creation and hosting. You can design and create packages that suit your clients, allowing for a more personal and better service to them.
It also gives your brand room to grow and bring in work that could benefit the rest of your business. Here’s how white label hosting can benefit you and your clients:
Expand Your Services
If you are already operating an existing business in web development or you represent a tech agency catering to internet services, adding hosting packages to your list of services would make your business a one stop shop. Your clients would be able to purchase everything they need from you. They’ll never need to go to a third-party seller ever again. They can purchase web templates, domains and their hosting from your business.
As an all-inclusive service, you will be able to charge higher fees for your services and offer various packages to suit your client’s needs.
An incredibly simple way to make some extra cash is through reselling hosting. If you can sell enough hosting products you can make a decent profit. To make a good profit in reselling you must first set a realistic margin expectation. Ensure you have a marketing plan in place to help you push and grow your new business venture.
If you’re working for a company that targets specific users, this can be a good opportunity. In the reselling business, you reach a wider audience that provides insight into their needs and this can trigger ideas for other revenue streams.
Increase Customer Retention
If you own a web design or IT company, you have the resources and expertise available to support this business. This creates an excellent synergy that doesn’t detract from your core business.
By selling hosting you will ensure that you strengthen the relationship between you and your customers and build trust.
This new relationship will benefit you and ensure that your customers always turn to you for their internet needs. As a reseller, you can act as a liaison between your customer and your parent host. Ensuring that they receive the ultimate in personal customer care.
Grow Your Bottom Line
One of the more beneficial aspects of reseller hosting is that it is a recurring payment. Offering hosting can be a great way to transition from doing one-off services for your clients and increase your monthly revenue.
To begin, a few hosting customers will enable you to cover the monthly cost in renting hosting space and turn a profit. With White label hosting the costs are much less expensive than if you were to have your own servers and offer hosting.
Cons of White Label Hosting
While the possibilities and benefits of White Label Hosting can be endless and increase your businesses reach and revenue, there are also cons to using Reseller Hosting. Here are the downsides you will need to mitigate in order to be successful:
A Competitive Market
Perhaps the greatest risks involved with Reseller Hosting is the amount of competition.
Let’s face it, there are a lot of companies around today that are notable for their hosting services. Therefore, you have to be able to stay ahead of your competition and grow your clientele.
How you source your clients is entirely up to you. However, we’d advise you to use AdSense and engage with people on social networks about your business. Of course, the easiest way to make your first hosting deal is to talk to friends. Reassure prospective customers that they will always have access to you – that’s how almost everyone gets started with online business.
Of course, if you are already successful as a web developer or agency, adding hosting services may not be an issue for you with an existing loyal customer base. Growing your client list can be hard but it is doable.
Complication is Bad for Your Core Business
If you decide to become a reseller, it can take away from your core business. For example, if you are a freelancer or own a web design business, your main job is creating websites or content. Acting as a hosting provider pulls you in many other directions. So, ensure that you are prepared to allot your time to the core aspect of your business and reseller hosting. If this requires hiring additional people to help you run and continually expand your business then do so.
Customer Support is Time Consuming
Supporting your customers all year round is important in this business. So, it probably means additional payroll costs. Your Reseller hosting supplier should be able to offer assistance in this area, but you still must process new requests. You must play the middle-man if you aren’t technical enough to provide support directly.
Website hosting will always be a service in demand, as long as the internet exists and expansion continues. With white label hosting, you don’t have to deal with any of the costs or difficult parts of running your server.
White label hosting allows you to sell hosting services under your own brand name. Your customers will never know your suppliers. Plus, you will be a hosting company in your own right with the flexibility to build your business and your brand as you see fit.