Thinking of opening a hosting biz. Want opinions

[bbakes25]

Hey All,

I know alot about servers and hosting and dealing with hosting things so I am thinking about opening a hosting business. However I want some thoughts on what you guys think about my hosting plans and prices I made. Please post your thoughts. Thanks!
Plan A
100 MB Space
1 GB Transfer
$0.99 A Month

Plan B
Basic:
250 MB Space
5 GB Transfer
$3.99 A Month

Plan C
Plus:
500 MB Space
15 GB Tramsfer
$7.99 A Month

Plan D
Super:
1 GB Space
30 GB Transfer
$13.49 A Month

Plan E
Super Plus:
4 GB Space
100 GB Transfer
$24.99 A Month

Extra Space: $0.50 Per 100 MB
Extra Transfer: $0.50 Per GB

Anyone think these are fair? too low? too high? As I wouldn't oversell I'd have to make sure I would get enough to cover costs. Please post thoughts. Thanks again!

 

[stvn42088]

I guess I'm going to reply like I always do!

Your prices are too low.

And a question for you, who do you plan on your customers being? Are you just going to go after the hosting industry as a whole or go for a local market?

 

[bbakes25]

I guess I'm going to reply like I always do!

Your prices are too low.

And a question for you, who do you plan on your customers being? Are you just going to go after the hosting industry as a whole or go for a local market?

I was thinking as a whole. You know a little advertising here and there post some specials on forums, ect.

 

[stvn42088]

Well just think, there are lots of other web hosting businesses out there better make sure you have something different.

 

[CrazyTech]

I don't know your business plan but I wouldn't exactly consider those prices too low. However, I'd be happy to provide a few pointers for you when choosing your prices.

Cheap = Cheap
(will make more sense in a second)

This is hosting math 101. You'll notice that most hosts do not offer plans below around $4-5/month and for good reason. One thing about prices is that they do attract certain crowds. You'll notice that some of the worst complainers use either free or very cheap hosting. They tend to expect the world for $0.99 (or even a little more). My best advice is to stay away from these very cheap plans unless you know enough about the person to offer them one. I don't mind offering smaller accounts, but I pick and choose those that I do. Besides, are you really making anything from that $0.99 plan when you get down to it and do the math?

Business Plan is Vital

I cannot stress this enough. When you start out you need to know exactly where it is you want to go and what type of base you want. Are you going after cheap accounts? High end hosting? Etc. Pricing is a key part of this process. My best advice for pricing is to first off consider what you want to offer. Obviously more services such as 24/7 support will raise overhead and you'll need to raise your prices.

However, a good mark I recommend is to calculate your overhead costs. Typically, these include hosting fees (dedicateds, reseller plans, colocation...whatever you use) and any other monthly fees such as dedicated IPs or software licenses. Find out how much each GB of transfer costs you and work from there.

IE: You have 100 GB of transfer for $25/month.

This comes out to $0.25/GB so with your first plan there you're making $0.74 a month from the plan minus any other fees such as Paypal fees or merchant fees. Those will probably set you back to $0.70 or less. Selling 10 of these plans will make you $7.00 a month. Is it really worth providing any tech support for $0.74/month?

Just something to consider. Hope my post has helped you out at least a little.

 

[toplevel]

Your prices are too low.

your prices are too expensive. I can find hosting for cheaper and with a reputation very easily. If you want to start out, you need to find a business model that fits and that will attract customers, something that makes you UNIQUE in the business.

i.e. the company I'm with Site5.com, they offer a customized cPanel control panel that is much easier to navigate and use than the default one. They also offer True Multisite which allows me to create unlimited shared hosting accounts for myself (in essence). Just find a unique business model and stick to it.

 

[stvn42088]

your prices are too expensive. I can find hosting for cheaper and with a reputation very easily. If you want to start out, you need to find a business model that fits and that will attract customers, something that makes you UNIQUE in the business.

i.e. the company I'm with Site5.com, they offer a customized cPanel control panel that is much easier to navigate and use than the default one. They also offer True Multisite which allows me to create unlimited shared hosting accounts for myself (in essence). Just find a unique business model and stick to it.

I was suggesting that he increase his prices and target a local market. Furthermore it does not matter if you can get cheap hosting with reputation, how does that help him?

I would rather have to deal with one $30 account than five $6 accounts... The way I look at it, its doing support for one person rather than five.

 

[noswad]

Why not offer the capability to host several websites under one hosting package? Id find this very attractive.

For example, i use 123-Reg.co.uk to host Domain3.co.uk - a crappy website just to sell my domains. This costs £1 per month.

If possible, i would have liked to use a hosting package I currently have with 1&1 to host Domain3.co.uk but couldn't as the capability to host 2 different sites under 1 hosting package was not available meaning id have to open a new hosting package.

I could have opened another hosting package with 1&1 but their cheapest is £5 per month so opted for 123-Regs at £1 per month!

This now means I have 2 accounts which means more loggin-in and more maintainence which really chaps my ass!

 

[deet]

Have you looked at webhostingtalk.com I am certain you can get alot of info from that site also.