How much do u make?

Portal Home > Knowledgebase > Articles Database > How much do u make?

Posted by Furton, 07-11-2001, 10:41 AM
I know many companies do not want to share out this info, but I'm interested in knowing how much profit you resellers make depending on how many customers you have? And how big are your profit margins? Do you have to have a particular number of customers to brake even e.t.c
Posted by BeDifferentSolutions, 07-11-2001, 11:39 AM
I think a more accurate wording for most host now days is "And how *small* are your profit margins? "
Posted by Jason Ellis, 07-12-2001, 04:37 PM
LOL - actually, for a lot of companies in the industry, the question should be "What's a profit margin?" I am truly amazed at some of the positively insane pricing models I've seen listed here from time to time.
Posted by BeDifferentSolutions, 07-12-2001, 05:19 PM
To me it is more insane the way these host try to defend their "low or no" profit margins here on the boards. They swear up and down, great service and support can be had for $25.00/yr. My reply is "How long have you been in business?" None of them have been over a few months. Usually at the 6 month mark the Delusions of Grandeur are gone, and they close shop when they don't receive the million dollar pay off.
Posted by carpman, 07-13-2001, 07:34 AM
So do think is fair price to charge for client but still enables good support and a decent profit?
Posted by Andy128, 07-13-2001, 12:06 PM
A decent server prices around 300-500a month plus all the extras..... How would 25bucks a year going to kick it for profit? Unless its a cheap raq3
Posted by Ericd, 07-13-2001, 12:10 PM
Unless you give 250mb of monthly bandwidth and overload the server until it crash every 60 minutes
Posted by GordonH, 07-13-2001, 01:04 PM
Hello It is possible to offer plans like that as long as they are not your only offering. We do a $36 plan. Those sites are on servers that have other types of hosting plan on them. They don't use much in the way of resources. I can't say we sell many of them, but we sell maybe 2 per week out of 40-50 net signups. We also do a 10MB hosting package with domains at $19 which might seem insane but its cheaper and more reliable than offering web redirection. The accounts have no cgi and the servers are specially set up for it. We then have a captive audience to sell upgrades to. Without getting into the nitty gritty of it, it makes a very good profit as our monthly hosting clients cover all our monthly overheads in server leasing, colocation prices, support, admin, accountancy etc etc. Any profit brought in by any new sales is profit. Obviously that reaches the point where you need to invest to increase capacity, but within a week that new server is paid for by monthly hosting clients on it. Gordon
Posted by Jaiem, 07-13-2001, 03:35 PM
The really funny thing is that when someone goes a $2.99/mo host and the host goes out of business in 3-4 months, what do they do? Just to another dirt cheap host! And so on and so on.
Posted by JKLIVIN, 07-16-2001, 08:39 PM
Gordon is the only post that has really answered the question, I would like to see some of the answers from some other people.
Posted by aaent, 07-17-2001, 01:01 AM
I know many companies do not want to share out this info, but I'm interested in knowing how much profit you resellers make depending on how many customers you have? And how big are your profit margins? Do you have to have a particular number of customers to brake even e.t.c As a business model goes it is up to you. If a reseller charges you say $5.00 per month per account and you charge $15.00 per month obviously you would make $10.00 for that customer. If you work out of your house and pay $30.00 for dsl, $49.95 for your reseller package that gives you say 10 domains. After eight customers your company breaks even. At ten customers you would make a whopping profit of $20.00 per month, providing your customers pay on time. . Now you need to spend more money to upgrade your reseller package. If you can get to say 20 clients, you would make enough money to find a low cost dedicated server, then your cost would stay the same for your next few hundred clients, depending on the bandwidth charges and the type of server. Then you can really start making a profit. Just remember with each extra customer the support increases. At some point you need to hire more employees to keep up. I have found after several years in business that every extra cent goes back into my company. Fortunately I have other income to support myself. At the same time the value of the business increases greatly on a steady basis. Hope this helps and happy hosting,
Posted by MCHost-Marc, 07-17-2001, 02:43 AM
We are not resellers, so it is hard to answer this post. Of course you can make a lot more profit with a dedicated server ...and also handle the load/customer accounts easier Just always keep in mind that if you grow ...you'll need employees simply because you can't keep up with the work anymore.
Posted by GordonH, 07-17-2001, 04:20 AM
Thats the same here. I draw a personal salary (well Directors dividends for tax purposes) but the rest of the money goes into investment. Right now we are running at 50% capacity so we should be able to double our customers without spending any more money on servers etc. To show you how slim the profits are: I think our average turnover would be around $20,000 per month and by the time all the contractors are paid and all the prices covered I am able to pay myself $3000 (including pensions, taxes etc) and have no money left that month. Its still better than most .com companies who are in debt...... Slim pickings in this industry and it requires volume to get there. I was in a different position to many of you as my intention was to create a business which could give me the salary I was earning with my previous employers. I have a lot of overheads (3 kids, Wife, house etc) so we couldn't really take a cut in salary. I built it up in my spare time until it got so big I basically walked out of my job. Gordon
Posted by Fiber, 07-17-2001, 06:36 AM
Stories like that make me want to get a reseller account and start working.
Posted by brianc, 07-18-2001, 07:42 AM
good to hear your story Gordon. Helps me to keep motivated and go into things I have planned.
Posted by Furton, 07-18-2001, 02:47 PM
How long has your company been going for Gordan?
Posted by GordonH, 07-18-2001, 03:10 PM
Hello In its present form since last August. Really got going in September. Its not all roses though. I am working 18 hours+ every day. I am still working from home but I have contract staff in the US. I recently put in a US 1-800 that routes to here plus mailing addresses in London and New York. It has already made a difference. I don't think anyone needs a physical office these days. We find the virtual office works fine and it saves the commuting. Gordon
Posted by OWL INTERNET, 07-18-2001, 06:34 PM
When I first got into web hosting business in '99, I use to resell for below10host, and I'll tell you it wasn't that bad. In my first month, I belive, I made around $300 in profits from reselling, then next month, it was around $600. I had around 80 resold accounts, and my bill was around $500-$800 every month. That's when I moved to a dedicated server with alabanza. Our client base grew to around 400 clients in 4-6 months. We had around 200 visitors and ~10 new accounts everyday - that's when all the fun began. There is nothing wrong with reselling, as long as you know what you are doing. Even if you have money for a dedicated server, you could still start reselling, and see if this business is for you or not. Everyone has to start somewhere, and it's okay to dream big.
Posted by JBIZ718, 07-18-2001, 11:32 PM
Well here is a business model that seems to work. Get a dedicated Server... For around 350 a month with fees and support. If you charge 50 a year and fill the server up with 200 accounts, you will make a overall profit of 5800 per server per year. And actually a friend of mine thinks he can fill a server with 200 domains in about 2 months if not less, i actually even have a interesting wager with him. My point is, is that even if you offer large accounts about 90% of the accounts will never use the resources you are offering, leaving most of the cpu load for the big accounts. I think hosts realize that, and if you know a decent amout of info, filling a server quickly can be easy. Joe
Posted by edude, 07-19-2001, 12:07 AM
Hehe JBIZ718, i can't say its impossible, i'm getting close to my goal myself. Yes JBIZ718's theory definetly works
Posted by Honu, 07-19-2001, 02:52 AM
Aloha for those that are making money how much time is it takign to handle all this ??? I do not want to spend tons of time holding hands any thoughts ???? Last edited by Honu; 07-19-2001 at 06:59 AM.
Posted by Jedito, 07-19-2001, 03:55 AM
That is $498/month and if you don't have to pay to a support, the % per CC gateway or your Merchant account, internet, electricity, phone etc.. etc.. etc. I don't know if that could work.. but.. its see weird to me
Posted by switch, 07-19-2001, 05:57 AM
I was wondering... If I start out reselling and by some freak act of Jebus what kind of pain will it be to transfer my clients over to a new system? switch
Posted by GordonH, 07-19-2001, 06:09 AM
Hello It can be quite difficult if the site has CGI because you might need to change paths in the scripts. To be honest with you I didn't bother. I still have some on an old reseller plan. Occasionally one will stop paying or cancel and the numbers are going down. Basically I am too lazy to move them. Gordon
Posted by CJCS, 07-19-2001, 08:15 AM
Hy, we're currently in the process of moving all of our customers from a leased RaQ3 to 3 new servers which we own. Its hard work because you had to check every side and every script if something does not work. You had to transfer all mail accounts and settings. Remember to move all mail too so no mail get lost. Copy Databases and so on.... It's much work :-( Greetings Oliver
Posted by matra, 07-19-2001, 10:01 AM
Well, I live in India where the prices are less but the rates we get for webhosting are even less. When I started out 18 months back, I was hoping to make a decent profit. Now the costs have fallen and 've managed to break even with the help of a few good corporate clients. If most of my clients were in the US and with me in India, that would be perhaps a different story. The figure of $498 per month mentioned by Jedito may be peanuts in the US but is quite a good one over here. Basically I live and work in my own house. I could perhaps make good with that amount and even save a $100-150 per month Cheers, Matra
Posted by Kaith Sutai-Rustaz, 07-19-2001, 10:26 AM
We make anywhere from $7-$20 / mo on our hosting plans. Webdesign is alot more profitable. We make somewhere between $600-1200 per job, though thats a very rough number. We've been running a hosting/design special for a while thats been well recieved at $300 the first year (space, reg and a few pages) that nets us about $150 at the end. Bear in mind, this is all before we work in the overhead, ins, rent, isp bills, etc but after hosting/reg prices. :/ Personally, I'd rather do the 3 design jobs a month than sign up 30 hosting accts. Moneys the same, but the profit margins alot greater. my 2 cents.
Posted by switch, 07-21-2001, 04:49 AM
Yeah, I live in a BFE kinda area just south of detroit, MI and I'm swamped with calls, offers and what not for web design. I'm just wondering if it's going to be worth it to start reselling to some of my smaller clients..... _____________ And now for something completly different lol sorry, I just love that!! _____________ swtich

Add to Favourites Print this Article