Reseller Options

Hi,

I am currently looking to setup a new reseller account with a hosting company.

I’ve heard mixed reports about GoDaddy, however i’ve always found their support satisfactory.

I also find that their websites (on standard shared hosting accounts), seem to run noticeably quicker.

I have spent some time on their website and on the phone to them reviewing their reseller options.

They seem to have two options but, seem to market one more than the other (especially on their website).

A - SELL GoDaddy THROUGH YOUR SITE
This option allows you to sell GoDaddy domains and hosting packages through your site. GoDaddy provide you with a resell rates for domain names and hosting, and then you add your markup onto their figures and your customers complete the orders seamlessly through your company website.

B - TRADITIONAL RESELLING VIA VPS
This option allows you to buy a VPS and then sell / add new domains and accounts to the VPS, which you then sell to your customers.

Options B seems much better to me, as you don’t make as much with A, due to the fact that GoDaddy are taking a large cut on each domain name and hosting package that you sell. Am i right in saying that if i choose option B, then i just pay a set fee every month, regardless of the number of customers i have?

Any other advice on this would be much appreciated, as i am completely new to the reseller market, thank you.

You are correct about B, but the trouble is that you need to math out what you’re offering your customers. Will you be guaranteeing them a particular amount of disk space or cpu power? If so, you can’t do that on a single VPS without a lot of work, if at all. If it’s small business sites who simply want a place to host their site and don’t care about details, this could work.

The other thing is that you have tons, tons more setup and maintenance when running your own VPS based hosting server. It’ll be far more work for you. Option A you’re merely selling them a GoDaddy service - essentially, you’re a middleman for GoDaddy.

Option A is ethically dubious, to me, unless you’re offering something of value to the customer, you’re just marking up something they could easily get without you. Option B is far more work, but far more reward for you. Just depends on what you’re looking for.

Additional note for Option B - it’s hard to break into the hosting market unless you have a long client list already. Most people are looking for recognized names OR the cheapest prices, and you won’t be either. When I bought shared hosting for clients, in the past, I always went to bigger, solid providers - so that I knew they’d be taken care of long after we stopped working together.

Hi Jeff,

Many thanks for the great reply.

I have a long list of clients, but i’m also always advising new clients to go with a particular hosting company, so i thought i should try get a cut of that and agree on a hosting and maintenance fee.

I was hoping to generate a monthly income from all of the hosting that i put forward to other hosting companies, so i thought that i would just offer this service myself, and then charge them a monthly hosting and maintenance fee, as i often find myself updating my client’s website for them. I am not trying to generate new business / customers because i provide hosting… i just want to get a share of the hosting that i sort for my clients.

Based on the above, which option do you think would suit be best?

That seems to make sense. So in essence, you’re justifying a markup as a fee for handling the account - you take care of updating contact info, small website updates, transferring files, contacting GoDaddy in even of issues, etc. (I think?)

If that’s what you want, option A sounds better to me. Like I said, with B you’ve got tons of planning to do, you probably need a cPanel license or another hosting panel, a pretty beefy VPS, and a bunch of serverside setup before you can start hosting.

A would be far easier money doing what you’re already doing. B is a new project/job.

Ok great, thanks Jeff.

I presume that the commission will keep rolling with A on a monthly and annual basis, and not just a one off commission fee. I’ll call GoDaddy again and see what they say.

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