Reselling hosting services allows you to add another source of recurring revenue to your business. As more agencies and web design businesses offer reseller hosting, clients are becoming accustomed to having a one-stop-shop for all their website needs.
The pros of hosting websites for clients
- Clients like the concept of a one-stop-shop that accommodates all their website needs, and providing a hosting service is not a labor-intensive endeavor. A few hosting providers offer hosting specifically for resellers. GreenGeeks is one such option, though there are others.
- Providing full-service website care will help your agency remain competitive in a crowded market. It is a value-added service, and new clients are attracted to the concept of having all their website needs to be handled in one place. Clients often do not have the skillset or time to handle setting up their own servers or VPS, so offering a hosting service makes you more valuable.
- Your job will be easier because you will be using a server and hosting environment with which you are familiar. You will have access to any logs needed to maintain a client’s website, and creating and managing databases on the same server takes less time. You will come to know the hosting environment well, including the software and backup procedures.
- You have more control over every aspect of website design, development, and maintenance by providing hosting. If the PHP needs an upgrade, you can do so without having to coordinate through an IT department, avoiding red-tape and delays.
- Hosting just a few clients will cover the costs of your reseller hosting, meaning you no longer have to pay for your website hosting. Selling hosting to more than a few clients is pure profit.
The pros of hosting websites for your clients is compelling, but there are pitfalls to consider before you add it to your list of provided services.
The cons of hosting a website for clients
- You will be the one a client calls for any technical support related to the hosting provider. If your hosting provider experiences an outage, you will be the one the client calls, and there will be nothing you can do to resolve the problem.
- It is crucial to choose a hosting provider wisely because you are staking the reputation of your business on their business.
- You need legal contracts to protect you from liabilities related to reseller hosting. If a client loses data because of a hardware failure or suffers a loss of sales due to a network outage, you could be facing a lawsuit. You can mitigate this risk by contacting an experienced attorney to draft a solid contract making it clear these risks are beyond your control.
- You risk losing clients, and potentially your reputation if you chose a hosting provider that does not provide dependable performance and guaranteed uptime that exceeds the industry standard.
- The argument could be made that developers and designers should stay in their lane. In other words, focus on what you do best and do not try to step into web hosting when plenty of companies specialize in hosting. However, those who feel like this tend to be freelance developers or designers. Growth-minded companies see the value in adding another income stream and think that the familiarity with the hosting environment makes their site designers and developers better at their jobs.
If you decide to move forward hosting websites for your clients, there are some things you need to consider. Your business will need a plan regarding handling customer service for hosting issues. Will you refer your clients to the customer service of the parent hosting company? If so, this needs to be made clear from the beginning. Regardless, you will still receive customer service calls from clients who want you to handle hosting issues. Establishing a customer service protocol for these events will help prevent losing profits.
You can turn customer service into another potential revenue stream. Consider acting as the customer service liaison for your clients as an added service. Upsell the ability to deal with customer service from the parent company if the need arises.
You know your company and its capabilities better than anyone. Is adding hosting websites going to spread your time and resources too thin? Though it is profitable to resell hosting, it does require some time and resources. If you are already struggling to keep up with demand, you may want to wait until your on ore solid ground to add any additional services.
If your business is growth-oriented, then providing hosting to clients is a powerful marketing tool and an excellent way to increase revenue. Whether it is the right time to provide hosting depends on the immediate and longer-term goals for your company. Increasing profit is always beneficial, but not at the costs of putting your relationship with your clients at risk. If you can provide customer service for hosting or have clients who understand that their hosting issues will need to be handled through the parent company, then there is minimal risk involved.