Transcript of "What You Need to Know to Start a Web Hosting Business"
==== ====For more information and Special Web Hosting Discounts, please check the website below.Thanks.http://webhost.toufangle.com/==== ====Want to be a web host? What you NEED to know!After a good amount of time in the business of web hosting, I have come to realize many things.Learning these things has helped me in my business more then anything else! It wasnt any costlySEO company, it wasnt any overpriced Google or Yahoo ad program. It was hard work, it washours and HOURS that turned into days and then weeks of time spent working on the website,editing the website (then editing again), making sure my keyword relevancy was up to par usingmy favorite keyword analyzer at Submit Express, checking to make sure my packages were pricedto compete with other hosts that offered the same quality services that I provide (not the kiddiehosts that offer 25gb disc space and 200gb bandwidth for $5.00 a month), and also taking care ofmy clients to ensure they got anything they wanted or needed.So anyway, lets get on to what has worked for me. Some of you other hosts may disagree withme, or have had different experiences then I, so again, this is only what worked for me, and is myopinion only.I started my first web hosting business in November of 2004. I cant disclose the name of thatbusiness due to the agreement of sale, but I can tell you that it was a very successful host, andwas on track to be a big player in the web hosting game. I just burnt out and had to sell! I wasworking 16-20 hours a day taking care of clients via Yahoo, MSN, ICQ, AOL, Skype, PHPLive, andany other live chat program I could use, email, and phone. This leads me to my first assessment,and bit of knowledge to pass on.1. Support : This is (in my mind) the most important part of a web hosting business, and can makeor break a starting business FAST, either way. If you offer TRUE 24x7 support to your clients, andthe support they receive is fast, accurate, and friendly. Your brand (host name and logo) willspread like wildfire, in time, you just have to be consistent with the support. You cant let tickets layaround because you had to go to school, or you had to mow the lawn, or your girlfriend wouldntlet you, or you just didnt feel like dealing with it.This can prove to be a very difficult task after awhile. The first few customers you get will submit afew tickets a month. Then, when you have a few more, maybe 25, you will start to have tickets,live chats, emails, pre-sales questions, all of it pouring in at once. Then you get up in to the 50-100client range and you are swamped. This is when you start to loose sleep and begin to burn outquick!If you have 50-100, or ever 30 or so, you should look into an outsourced support solution. I haveused BobCares and have found them to be the most professional and reliable for the package
they offer resellers, and starts at $24 a month to cover 12 clients 24 hours a day 7 days a week.Some hosts, and customers, frown upon outsourcing support, but until you have the money to hireyour own support staff, I suggest you look into outsourcing. Another company I have heard goodthings about is Root Support, though I havent tried them, I have noticed that they have some verygood prices, and as I said, good reviews.So thats the upside, the bad side is easy. You dont offer good support, and you find yourself in 3months telling the 500 FREE hosting clients, and no paid clients that you have, that they need tofind another host because you are shutting down.2. Choosing a host: When you are searching for a reseller , or VPS host, you may be tempted bythe low prices of some overselling host (run by a 15 yr old kid) that offers the world or, my favorite,"Unlimited"..LOL. You show me a host that has a hard drive with unlimited space, and Ill show yousome pictures of Big Foot that I took in Buck Snort Tennessee! If you choose a host by price aloneyou are destine to fail. You will end up with nothing but downtime, nothing to tell your clients whenit happens because your host is no where to be found, and when the server IS up, it will be sooverloaded that it will run like an epileptic chicken!I heard it described best on a forum, "There is no perfect host, there is only the host that is perfectfor you". I suggest you look at Web Hosting Talk.com. Be sure to look in the "Advertisements"section, there are always a few good offers there for whatever type of hosting you are needing.You can also Google the words "web host review." That will bring up hundreds of differentresources for use in choosing a web host. This can be quite overwhelming also, so try and be asspecific you can in your search terms.When looking at the prices offered by offered a host, ask yourself a few questions.A.Does the website look professional, or does it look like something you could have made whenyou were 13? This is not always the best way to determine your host, so again, do not base yourdecision on the website alone either!B.What type of server specs (CPU, RAM,) does the host say that your account will be held on? Ifyou do some further research, youll see that a reliable server with even a single P4 3.0GHz HTserver with 1gb RAM is going to cost $150 AT CHEAPEST, and if you go up into the dual CPUservers, the price of a single server can go up to $300 a month EASY. So, if the host is offering5gb disc space and 100gb bandwidth for $5 a month, you can be pretty sure you are not getting asgood a deal as it may seem!C.Check their support link, does it even work? If they offer live chat, use it, send them an emailand ask questions specific to your needs, ask as many questions as you want, in as manydifferent emails or tickets as you want, its a very important decision, be SURE you get what youneed from a provider that will GIVE you what you need.D.Uptime: a lot of hosts offer shared hosting plans for as cheap as $1.00 for the first month. Isuggest you sign up and pay for one month. Tell the host what your intentions are, and that youwant your account to be placed on the same server that your reseller will be placed on so you canreview the resources. Then place a free uptime monitor such as DotUptime on it and see what theuptime is like in a 1 month time period. Spending a couple of dollars to make sure you get what
you want will save you a TON of headache in the future!E.Search as many web hosting forums and / or Google pages as you can for "whateverhost". Lookand see what others have to say about the host. But, keep in mind also that no host can pleaseEVERY customer, and some people just cant be pleased.F.Finally, is it within your budget? Dont be afraid to spend some money if you can, but dont gooverboard either. Remember, you have to spend money to make money. I am one to go all outfrom the start. I believe that the more you put into a GOOD host, the more you get back, and thehappier your clients are, in turn attracting more customers. So we have our servers atLiquidWeb.com . They have proven to be the most reliable in terms of managed dedicatedservers.3. Choosing a billing system : There are many different billing systems available, and searching forone thats fits can also be a wearing task. There are the first few big name scripts such asModernBill, WHMAutoPilot, ClientExec, and Lpanel. Most of these options allow for automatedaccount creation, meaning when a customer signs up and pays, it automaticly creates theiraccount and emails the customer their login information.It isnt wise to use this feature though, unless you also pay for a fraudgate to check all your ordersbefore setup. If you allow instant (automated) account creation without a fruadgate, you will findyourself swamped with spammers and fraudulent orders that result in charge backs, in no time atall!ModernBill is by far the best in my opinion, and goes for about $25 a month. It keeps track ofeverything you can think of, ands some very key features that others dont have, such as theability to update package price depending on the upgrades they choose. WHMAutoPilot is the nextstep down at the same price ($25). It is still a very powerfull billing system, but lacks a few smallfeatures that ModernBill has. ClientExec is the best choice for a beginning web host, and starts at$12 a month. It is all you need to get ready to sell and keep track or your clients. It also has a builtin support desk (most good billing scripts do). When you choose your billing system, be sure youread the description of that package. Some of them charge per client after a certain amount, andthat can get costly.4. Advertising : Its no secret that any websites success depends on the amount of traffic itreceives. So, in order to get traffic you have to let people know that your website and packagesare out there!Some good ways I have found for doing this are:A.Forum posts: Register at as many web hosting forums you can find in Google. Most web hosingforums have "Requests Hosting" sections, so you can post offers to requests there, and you canalso post offers in the "Offers" section usually. Be sure of the forum rules BEFORE posting youroffers though. If you post an offer and it is edited by a moderator and only reads "Read the rules"your not going to look like the most trustworthy host. Remember to put a link to your hostingwebsite, and maybe a little sentence or 2 about your services in your signature on the forum. Tryand make it eye cacthing, add some color, or some symbols (>> +ll whatever).B.Look on web hosting forums for people offering ad space. I use WebHostingTalk.com for my ad
searches, and it has worked very well. Dont buy ad space on just any website. Try to only buy adspace on websites that pertain to yoru market. For example, you wouldnt put ads for a huntingwebsite on an animal rights activist website! Try to only place ads for your hosting business ondesign sites, or hosting search forums, hosting directories, script development websites, anythingthat they might need a web host for!C.Banners: Some say banner ads are dead, but I disagree. I know when I go to a website and seean eye catching banner ad, I tend to click on the ad to see what its all about. Whether this resultsin a sale or not, it is still a great avenue for brand awareness. So, if you decide to do some banneradvertising, be sure to have an ad that looks professional, and eye catching. Otherwise you havean ad that no one notices.D. Word of mouth: Without a doubt, the BEST type of advertising! When you provide good serviceand support to a client, he goes and tells his friends " Hey, I got this host you guys should checkout". Then, those friends tell their friends, and their friends tell their friends, and their....You seewhere Im going with this!E.Local Market: Never underestimate your local market. You can start by making some fliers topost around town, or place some business cards on post-it boards. Ads in your local paper or admagazine are sometimes good also. You can also think about sending a little packet of informationabout your business and what you can do for a client to small businesses in / around your areathat might need a website and/or web host. If your budget allows for it, radio and tv ads are greatsources, but can be very costly.5. Prices: Dont try to be the cheapest host on the block, you will only run yourself into the groundover time. If you look at the "Big Boys", or as I like to call them, the "Oversellers who can", you willsee that if you tried to beat their prices you would be out of business within 2 -3 months.Instead, take a look at your hosting package, whether it be a reseller, VPS, or Dedicated Server,and do a little math:Lets say you have a reseller package with 10gb disc space, and 100gb bandwidth (a little large fora starter reseller I know, but its an easy round number to use J ). Well say your reseller costs you$25 a month.You can look at your costs in a couple of different ways, heres a couple that I use:Disc SpaceCost (monthly)Bandwidth10GB$25.00100GB5GB$12.5050GB2.5GB$6.2525GB1.25GB$3.1212.5GB612MB$1.566.25GBOr, you can split the costs and look at it like this:Disc SpaceCostBandwidthCost10GB$12.50100GB$12.505GB$6.2550GB$6.25
2.5GB$3.1225GB$3.121.25GB$1.5612.5GB$1.56612MB$0.786.25GB$0.78Or, do a little chart like this:Disc Space10GB5GB2.5GB1.25GB612MBBandwidth100GB$25.00$18.75$15.62$14.06$13.2850GB$18.75$12.50$9.37$7.81$7.0325GB$15.62$9.37$6.24$4.68$3.9012.5GB$14.06$7.81$4.68$3.12$2.346.25GB$13.23$7.03$3.90$2.34$1.56Remember to ad in your other costs, such as your billing system, your sitebuilder (if you haveone), processor fees, and any other cost you may need to add.After you have added up all of your costs, then decide what you think is a fair price to chargeOVER your costs. So if a package costs you $5 a month, then maybe you would charge $8 - $7 -$6 a month. Just be sure to allow for enough profit to upgrade when you need to.Again, dont try to be the cheapest, youll be shooting yourself in the foot for sure!6. Overselling : Overselling is the practice of selling more disc space and/or bandwidth then youactually have. So for an example, lets say you have 1 apple, you tell 8 people that you will sellthem %25 of the apple. So if the people actually eat all of their apple, you are in trouble! Someoverselling is ok, not a lot, you dont want to overload your reseller or VPS, or dedicated server.You can safely assume the following (usually).If you have 10gb disc space, and 100gb bandwidth, you can sell it as if you had 12gb disc space,and 120gb bandwidth. Its a small percentage, but can help to increase profits. But be sure to keepa close eye on things, and upgrade when / if needed.7. Professionalism : When you are posting an ad on a forum, replying to a pre-sales email, talkinga to customer in chat, or replying to a support ticket, you must always maintain a professionalattitude through your speech, or typing. A person looking for hosting isnt going to be interested ina post that reads like a 12 year old wrote it. Try to use proper punctuation, I am not the worldsbest at that (as you can see), but I try J.Never discuss business matters or private customer information in public situations such asforums. This can lead to serious legal issues!8. Free Hosting: A lot of hosts offer free hosting in hopes that the user will eventually upgrade.The truth is, only about %5 of your free hosting customers will upgrade to a paid plan. Also, it isusually those seeking free hosting that have no idea what they are doing and send hundreds ofsupport tickets a month. Or, they sign up with a free host, send out a few thousand spam emails,and then move on to the next free host.So to make a long story short, free hosting isnt worth the time or frustration. Instead, maybe offer
a small, shared package for $1.00 a month. This is low enough to reel them in, and then havethem upgrade.If you do decide to offer free hosting, be sure to put free hosting customers on one server orreseller, and paid clients on another reseller or server. That way if one of your free clientsoverloads the server, your paid clients are not affected at all, and you have no worries of loosingthem!9. Firm, Fair, and Consistent: I have found that you have to be fair overall, but you must also befirm, and consistent with your clients. If they are late on their payments all the time, start topenalize them with a late fee, their payments will soon show up on time for sure. I dont mean topenalize them $100 for the first time their late, but there should be some sort of "push" to makethem pay on time.If you have a client who is requesting a refund because of an extended amount of downtime, youwould want your money back to, so give it to them, always be fair.Stay on top of your billing system and system resources, and when you come across a problem,take care of it right then, dont wait!I hope some of this helps some of you!Owner of My-E-Space.com. A web hosting business offering reliable hosting, and excelentsupport.Mike BrownMy-E-Space.comhttp://my-e-space.comArticle Source:http://EzineArticles.com/?expert=Michael_S_Brown==== ====For more information and Special Web Hosting Discounts, please check the website below.Thanks.http://webhost.toufangle.com/