Fatcow, along with many other firms in the web hosting injury, offer Reseller Hosting as one its core products; it forms an integral part of their product portfolio which also includes shared, cloud, dedicated and fully managed hosting, as well as Virtual Private Servers (VPS), domain registration and maintenance, and a range of e-commerce services. Fatcow operates a Reseller Hosting account programme whereby they sell hosting space at wholesale prices to a variety of small business owners and operators, who package them and resell them at retail rates to a variety of other small businesses and freelancers, often as white-labelled, or privately branded solutions.
For website hosting companies like Fatcow, Reseller Hosting represents a steady business stream which helps them grow their customer base, and spread their operating costs. It also has the advantage that all the risks and difficulties of client management are transferred from themselves to the reseller.
Why Reseller Web Hosting?
Reseller web hosting enables an individual or small business firm to sell web hosting to others for a profit. Often used by freelancers and entrepreneurs who want to make some extra money, the concept is simple. They act as a middleman and buy hosting services – frequently in the form of Virtual Private Servers (VPS) – from a hosting provider like Fatcow at wholesale rates. They then configure and divide the server according to their needs, add their margin, and resell at retail prices to subscribers.
From the viewpoint of the web hosting company, like Fatcow, reseller hosting is a useful stream of additional business income, and enables them to expand their operational base without the expense of customer acquisitions. It is also low risk income for Fatcow. Irrespective of whatever margin the reseller makes, or the problems they have collecting income from clients, Fatcow will still bill the reseller for the services it has purchased.
Fatcow offers resellers discounts of up to 20% off on their retail pricing. In addition, resellers are able to generate additional income by receiving volume discounts on hosting accounts.
Fatcow, like many other vendors, offers a reseller hosting plan whereby a subscriber pays a monthly fee for a bunch of resources that are partitioned into custom hosting packages. Other vendors have pre-set packages and charge per client instead. In either case, the reseller oversees these hosting packages through a control panel – known as a CPanel in Fatcow – where they have the ability to create and supervise separate accounts for their clients.
For those who want to need more disk space and bandwidth than is traditionally offered by a Reseller Plan, they could consider VPS (Virtual Private Server) hosting instead. Fatcow is one of the vendors that does let resellers resell part of their virtual server space.
Another option is Dedicated Hosting, which can include reselling. Not all hosting providers allow resellers to “resell” Dedicated Hosting packages – however, Fatcow offers a versatile range of packages which caters to this client base.
Pros of Reselling
Regular Income: Reseller Hosting means periodic fees which can form a regular income stream. The nature of web hosting is that, once their website is up and running, most customers will get by requiring a minimum of customer support, whilst providing an income stream on a regular basis.
Complementary Services: Many resellers are not offering hosting as a main service, but as a complementary activity to their main business, which might be as a developer, web designer, or IT consultant. Web hosting offers them an ancillary service which they can add to their product range, and use to generate additional revenue.
Control: A reseller has the power to control what services they offer, at what prices and on what terms, to what customers.
Minimal Investment: Many reseller hosting plans come at very affordable prices and some will not charge anything to the reseller initially. Resellers who are offering shared hosting, for example, do not need to worry about buying equipment, server maintenance, or related expenses. VPS or dedicated-hosting models will likely come at a higher cost, but then these can be charged out at a greater price too.
Flexibility: One of the major advantages of Reseller Hosting is that it is online, and can run from anywhere without the constraints of a physical office.
Cons of Reselling
Intense Competition: The Reselling Hosting Industry is swamped with literally thousands of providers offering the same service. Unless an individual firm can offer a unique product or service, it is almost impossible to distinguish them from the others.
Very thin Profit Margins: In most cases, profit margins are wafer thin. Many service providers are offer hosting to clients at rock-bottom prices just to get their business. This means that, just to compete, a reseller may have to cut their margin to the bone.
Technical Expertise Required: Whilst some Reseller Hosting companies provide direct technical support to clients, many do not. This means that a degree of technical expertise may be required in order to handle customer enquiries. And, if the reseller has gone down the white-label route, the hosting provider does not “exist” as far as the end consumer is concerned. This technical expertise may need to be quite advanced if the reseller is offering VPS or Dedicated Hosting services. If the prospective reseller is not comfortable managing hosting accounts or troubleshooting server issues, or lacks the knowledge and expertise to do so, then reselling is not for them.
And, where a reseller is using the original hosting company to provide technical support, delays and frustrations can occur because the reseller has to act as the middleman, receiving customer requests which they them have to create as support tickets, and then distributing the answers to those tickets.
It should also be noted that this is an area where some Reseller Hosting providers have been accused of bring the industry into disrepute because they lack the knowledge or necessary technical expertise to service their clients adequately.
Billing: The reseller has the responsibility for client billing, which, if they have numerous clients, can be administratively burdensome. Fatcow, for example, makes it crystal clear that resellers are entirely responsible for the billing of each of their clients. They will bill the reseller’s credit card on the due date for each of their clients, but all collections on the client side falls on the reseller.
Time Commitment: Reseller hosting offers a great deal of flexibility, but comes with demands as well. Web hosting is a 24/7/365 service, and downtime cannot be scheduled. Requests from clients can be received at any time of the day or night, weekends and holidays as well, especially if clients are located in geographically diverse locations and time zones. They expect and demand that their hosting provider is always available to talk to them. This can lead to issues with workload and take a toll on personal lives, especially with those clients who require a lot of help on a regular basis.
Fatcow Reseller Program
Like many hosting companies, Fatcow offers their own Reseller Program that enables owners of small businesses – typically web designers, system integrators, IT consultants and programmers – to sell their own web hosting services without the need for any upfront investment. Resellers, when signing-up, can custom brand the Control Panel, sign-up form and technical support page, and pass the entire hosting service off as their own.
It places no restrictions on the amount of money that a reseller can make – it allows them to resell Fatcow’s products and services at whatever mark-up they choose. However, the reseller is responsible for paying Fatcow for the services that they buy from them at discounted prices. This means that all the risk of billing is transferred to the reseller.
Clients of a reseller access Fatcow’s Control Panel (CPanel) through an unbranded interface; resellers are also provided with a free log-in form that enables their customers to log-in directly from their website.
Fatcow Terms and Conditions
A review of Fatcow’s Terms and Conditions (T&Cs) makes it clear that all the risk of reseller hosting is transferred in their case to the reseller. For example, resellers are entirely responsible for the billing for each of their clients. Fatcow only accepts credit card payments for resold accounts, and will bill the reseller for the hosting services they have bought on the due date for each of their clients. If the reseller fails to bill the end-client promptly, or has problems with collections, then the burden falls directly on them.
Equally resellers are directly responsible for providing technical support to any client that they sign-up. They explicitly state that, in the event that their customer support team receives any communication from the client of a reseller then they will refer that issue back to the actual reseller. In other words, unlike some of their competitors, Fatcow is not offering managed customer support as a distinct service to their resellers. There is reseller support, but this is to do with management of their accounts, not with technical issues that may arise on the client side. As a consequence, anybody offering Reseller Hosting under the Fatcow programme needs to have sufficient technical expertise to support their clients adequately.
Fatcow Reseller Pricing
Fatcow offers membership of their WholesalePlus Reseller Program for US $49.95 per year. Each individual account is then charged at US $2.95 per month. With this fee, resellers are offered unlimited disk space, monthly data transfer and email accounts, and US $125 in marketing credits for platforms like Google and Bing. Also included as WordPress, phpBB and GBook, ShopSite Starter, and an Install Central Application Library.
There are no set-up fees charged for client accounts and, as with all Fatcow services, an initial 30-day money back guarantee is offered. Upon registration, Fatcow resellers are offered discounts on web hosting, domain registration, search engine submissions and more.
Fatcow Reseller Support
Fatcow offers priority support to resellers from 8 am to 8 pm Monday to Fridays EST. It should be noted, however, that this is not the same level of 24/7 cover that they provide to customers under their other hosting plans. The vendor provides a billing manager for each of a reseller’s resold accounts.
Fatcow alternatives to Reseller Hosting
Fatcow offers subscribers alternative ways to make money without the commitments associated with reselling. Every web hosting company has an affiliate program that offers a pay-out for referral who buys a hosting package, and Fatcow is no exception. They provide a link which can be posted on a website or attached to an email; if somebody clicks on the link, and signs up for a qualifying shared hosting plan, the referrer earns US $100; US $150 in the event of a qualifying dedicated hosting plan.
Equally, subscribers can earn US $35 each time somebody they have referred signs up.
Fatcow’s Reseller Hosting Service evaluated
Uptime: Fatcow does not provide public guarantees of uptime. Whilst this may be regarded as a negative, independent reviews and tests suggest that actual site performance is in excess of 99.85% which is close to the best in the industry.
Technical Support: Unlike a number of its competitors, Fatcow does not offer managed technical support to resellers. Instead the responsibility for technical support lies wholly with the reseller. That means that unless the reseller has the technical knowledge and expertise to provide that level of support themselves, Fatcow’s Reseller Hosting programme is not for them.
Billing: Equally, the responsibility for billing is entirely the responsibility of the reseller. Fatcow will bill the Reseller for the hosting services they provide, but the risk of collecting fees and subscriptions against them falls directly on the reseller.
Reseller Support: Fatcow’s reseller support is only available 8 am to 8 pm EST, Monday to Friday. The other hosting services that they offer comes with 24/7 customer support.
Limitations: Although Fatcow offers unlimited disk space and monthly data transfer to Resellers, in reality there are limitations as to what this entails, and can lead to account suspension – for example, if one reseller uses too much storage space bandwidth, or CPU time. To be fair to the vendor they do warn that any user or reseller who hampers system performance can be penalised, but this is disclosed only in their terms and conditions and not openly apparent on their site.
Other Reseller Hosting Suppliers
A2Hosting, Siteground, Hostinger, FastComet, Interserver, InMotion hosting, HostPlus, Smarter ASP.Net, HostPapa, Reseller Club, Host4ASP.Net, Bluehost, ScalaHosting, Pickaweb, Krystal Hosting, Liquidweb, Heart internet, Eukhost.