80 percent of new ventures reselling web hosting make a profit within a year
11 November 2008, Gloucester, UK: 80 per cent of businesses that begin to resell web hosting in addition to their regular products or services earn a profit from the practice within 1 year, according to research released today by Fasthosts Internet, (www.fasthosts.co.uk), the UK’s largest reseller web host. The survey of 793 UK resellers[1], also found that two thirds (66 per cent) found it ‘easy’ to cross-sell hosting to their existing customer base, and half (50 per cent) have increased their average length of service per client as a result of reselling web solutions.
In today’s difficult economic climate, the figures lend weight to the concept of reseller web hosting as a low risk and profitable way to develop an enterprise such as an IT or marketing related business. Reseller web hosting enables an entrepreneur to retail brandable web solutions (such as hosting, domains and email solutions) and earn profit on the items they sell. Resellers can combine white-label web solutions with their own services, such as web design, programming or IT advice, to create tailored services for niche markets and so charge premium prices.
Some 70 per cent of Fasthosts resellers surveyed would recommend reselling web hosting to other businesses such as theirs. In 2008, the low investment costs involved make reseller web hosting a compelling business proposition. The research found that excluding monthly subscription fees, 61 per cent of resellers invested less than £500 in setting up their own reseller hosting operation.
Steve Holford, CMO Fasthosts Internet Ltd, said “In recent months, demand for reseller web hosting has been brisk as more IT related SMEs are seeking to diversify and add strings to their bow. By offering web solutions alongside existing services, many businesses find that they can bolster their revenues and protect their client relationships”.
The recurring fees model and healthy profit margins involved with web hosting can also be attractive for those under pressure to grow revenue streams. 64 per cent of resellers reported that they had increased overall ‘revenue per client’ as a result of reselling web solutions.
A further 84 per cent of those surveyed would recommend Fasthosts as a reseller partner. The Fasthosts Reseller Package, £50/month+VAT, offers an excellent low cost way to resell own-branded web hosting, domain names, email services and broadband. Fasthosts’ unique philosophy offers resellers unlimited web space, bandwidth and POP3 email enabling them to tailor packages closely to their clients’ needs. There is also a 3 month, no obligation trial that makes entry to the reseller market completely painless.
An important characteristic of web hosting is the excellent scalability, allowing one to model a reseller business flexibly. All technicalities and back-end processes are handled by the provider but the reseller retains all customer liaison and marketing themselves. Thus, unlike many other reseller propositions, a hosting reseller can focus on sales and unifying their new service to a corporate identity or existing offerings.
Holford added, “With the support of a high-quality provider, creating your own web hosting brand can comprise an efficient way to generate revenue. As the web becomes more critical for all sizes and types of business, the web solutions market will enable resellers to capitalize on growth areas such as mobile email, collaboration and ecommerce.”
For more information on Fasthosts reseller web hosting, see the website at www.fasthosts.co.uk/resellers
[1] 793 UK web hosting resellers surveyed in September 08 via electronic feedback form.
