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A reseller plan is cheapest way to start your hosting business, but with most limitations. If you donít have much money to invest, Iíd recommend getting a reseller plan from a reputable provider. Donít go with company with provides most for lowest price, because they are simply overselling and crowding their servers, and you will pay for it in overall performance.
VPS is an abbreviation for virtual private server. Usually, a reseller plan is more cost effective, but a VPS gives you more freedom. You can install your own software on it, and other users canít slow down performance. One strong advantage is that you can sell reseller plans to your customers.
A dedicated server is most cost effective (what you get vs. what you pay for,) and offers most flexibility, but costs most. You also need to consider management costs if you cannot manage it yourself. You can sell reseller plans, which is another big advantage, as well. Pricing starts at about $150 for a server that is suitable for hosting websites. You can get servers for less, but I wouldnít recommend them for hosting websites, as they arenít powerful enough. Dedicated servers arenít always best for start-ups, unless you have some money to invest.
Choosing how you will be hosting your clients is an important step that I recommend looking carefully at.
Once you know how you will be hosting your clients, you will need to look at support. Are you going to be running it by yourself, running it with a partner, with employees, or are you going to outsource?† If you are running it all by yourself, you will need to dedicate a lot of time into answering your support tickets, which can very time consuming. If you have a partner, you can both answer support tickets, which results in faster result times for your clients. You could also hire employees to deal with sales and support tickets, but you will need to have money to hire. Another popular solution is to outsource your support. There are companies that you can pay per-ticket, per-client, or per-server. This is popular for growing companies who donít have money to hire their own employees.
Now, weíre going to look at customer management. There are quite a few programs out there that can be used to accomplish this. You want to find a program that handles customer signup and billing. Three of popular ones are ClientExec, ModernBill, and WHMAutoPilot. These are scripts that you install and run off of your server. None of these are free, but there are different ways you can pay for them. You can buy an owned license, where you pay for it all at once, or a leased license, where you pay for it monthly.
That wraps up part 1 of Starting a Web Hosting Business. In part 2, we will cover advertising and marketing your new company.