In this article we will look at Reseller web hosting as a passive income opportunity. This is a business that I have tried a couple of times and I also have many websites so I will explain the concept and some of the pitfalls and also the web designer or business thinking taht i personally have when it comes to hosting.
What you basically do is purchase a large reseller web hosting package from another host and split it into smaller packages and charge a monthly or yearly subscription fee. This is where the passive income comes in, the theory is that you can have a monthly or yearly recurring income. The company you deal with is effectively a wholesaler.
Drawbacks of web hosting reseller
As a business or a web deesigner I am looking for a trusted name in the field, I want to see reviews from others that recommend the hosting service and I want to make sure that my money will be spent well on a reliable service with many features. You have to be able to guarantee this.
Despite what other passive income articles and books say you do have to handle all customer support, this is a major source of time and effort. If a customer site goes down they expect a response and a fix promptly no matter what time of the day, this means that you may just be acting as a middle man keeping in contact with the company you are buying the services from but you still deal with your customers.
It is a very cutthroat market – there are a huge amount of people who do this. In fact just look at ebay and you will see people offering hosting packages – I do not recommend doing this personally, nothing in my opinion smacks of amateur as selling hosting on ebay.
You have to promote the hell out of your business – you need to get word out to as many people as possible. This means social media – maybe even paid advertising, I’ll say this a few times in this article its a very competitive market.
You need a domain name and a web site already with a hosting style theme, this can be doen in wordpress. Your site needs to look great and work perfectly – nothing puts off a customer in this market than an amateur looking business site.
Usually you have to put money down up front to buy the packages you will resell
Reseller hosting Ideas
Offer hosting packages to people you know, local businesses , free giveaway – basically try and build a portfolio of customers who can recommend you and you can use for positive quotes regarding your service – hopefully.
One of the main ways to sell hosting is to offer it as part of another service that you may sell – here are some ideas
You could incorporate the hosting as part of a niche website package that you sell
You could sell a domain name and offer the hosting as part of a package. Some customers might think that this makes their life easier having the domain name and hosting from the same source.
Find a niche in your packages – some of these maybe programming language support, control panels or the content that is allowed on your service. The last one is a topic you need to think about some resellers based in certain countries allow ‘controversial’ subject matter like pornography, warez and other possibly illegal subject matter. I would leave this to your own morals.
Reseller hosting Summary
Yes, this is passive income opportunity but there is more effort in this than many other passive income ideas – if you sell websites, domain names you can maybe offer this as an add-on but otherwise for beginners I would not recommend this there are far easier and less time consuming methods.