The Untapped Potential of Reseller Programs

by Scott Bianchi

Published on this site: April 11th, 2006 - See more articles from this month

I am part of the growing population of people who are looking to earn a living working from home on the internet. I am constantly looking for new and better ways to earn some income. I participate in multiple forums having to do with affiliate marketing and working from home. Very few people participate in reseller programs and I think they are missing out on some big-time money.

A reseller program is as simple as it sounds. You become a retailer for a particular company. This is different from an affiliate program because you set your own prices, in some cases you even handle the billing of your customers and then you are charged by the supplying company for what you sell. Let me be more clear. You sign up for a web hosting reseller program for example. That company will then tell you what you are allowed to sell for their products and how much they charge you for each account. Then you create a website (in some cases) and you put the products on your website. A customer signs up for the service through your website and you take payment. Then you need to go to your reseller control panel and enter all the customer's information and the supplying company then sets them up for the hosting program they chose.

I chose web hosting as the example because that is what I have researched and signed up for so far. There many other opportunities however. Some of the hosting companies will provide you with a website and all you do it build it to your liking and set your prices. Others will just let you know which of their products you can sell and how much they charge you, like I mentioned above. Then you need to go in and enter all the customer's information when you make a sale. Some programs are free and other charge for membership and a set-up fee.

I researched the following:

1. iPowerWeb.com - They are one of the companies that require you to put their products on your own site and then you need to enter the customer's information in your control panel when you make a sale. They only allow you to sell one hosting package. So, if you want to give a lot of options to your customers you either need a different program or use numerous programs, which can be confusing. There is no charge for this program. I got no response on one communications with them asking questions about the program and a terrible answer on a second question. This concerned me a bit because how helpful will they be if I have a question concerning a customer's account.
   
   
2. Globat.com - This is one of the better programs I researched. They also do not give you a website, you would have to put their products on your site. No charge for this program either. They had very good prices on their programs. They also had a live person communicating with me via email to answer my questions. What I didn't like about them is the fact you had to prepay for the accounts. In other words, I would have to buy, let's say 10, hosting programs before I even sold one. The more you bought the cheaper they were. They were running a special, if you bought 10 you got 10 free. So, for 20 programs it would cost me $500. This is $25 each for a year. The problem is, they were only good for one year from the date of purchase. If I didn't sell them all for some reason I lost them and had to buy more the next year.
   
   
3. FatCow.com - On the surface a very appealing program. They claim for a one-time set up of $99 you get a fully functioning website. So, I signed up with them. That $99 got me nothing. I couldn't resell, I couldn't even host my fully functioning website. So, I called and found out I needed to spend another $99 for the ability to host the website. It sounded reasonable and I was assured this is all I needed to do. Wrong! I had a website now but still did not have the ability to resell anything. That was yet another "upgrade" and charge of $25. I went for this as well. I now had all the access I needed. They failed to explain however that the 7 hosting plans they show pricing for in their initial sales pitch you do not have the ability to sell. They only give you 3 options and 2 of them are eCommerce. For $225 I figured it was a good deal if I had access to all 7 of the packages they offer. I have since requested my refund and would not recommend this program to others.
   
   
4. Aplus.net - They have 2 plans. The most basic is their gold plan. This plan has a set-up fee of $149 and a monthly fee of $59. The plan only comes with one option for selling, their ePro hosting plan. They offer a platinum plan as well. That one srequires a set-up fee of $995 and the same monthly charge of $59. It requires a minimum of 500 customers.
   
   
5. GoDaddy.com - This is the plan I finally went with. https://www.securepaynet.net/gdshop/rhp/hottestreseller. asp?se=
   %2B&prog% 5Fid=329810&app%5Fhdr=
   
   As you can see from the website, they have two packages. The basic for $99 a year and the Pro plan for $199 a year. The only real difference is the amount you pay for the products. The Pro plan charges less for the same products as the basic plan. You have access to all of the products GoDaddy offers. You can decide not to sell them if you want but you do have the option. It is a fully functioning website. You set the prices and they pay you the profits.
   
   Here is an example of the website you would get if you signed up for this program:
   
   https://www.securepaynet.net/gdshop/rhp/default.asp?prog _id=329826
   
   With the Pro plan you also get $250 credit toward Google Adwords. They also have arrangements set up with some of the top affiliate programs if you would like to promote your site through them.
   
   Considering the ease, the wide range of products, and the fact everything they advertised in their program was true, unlike FatCow, I felt $199 for a year is well worth it.
   

One other difference between a reseller program and an affiliate program is the fact that when a customer signs up you have access to that customer's information. Now you can work to build your mailing list this way in addition to other ways you may be using. As an affiliate you do not have this option. Also, if you are an affiliate you usually do not get residual income, as the reseller you do. All of the sites above offer both affiliate and reseller programs. After reading this email you will hopefully see there is much more potential as a reseller, regardless of which company you go with or which product you go with for that matter. To prove my point I wanted to do some quick math, using very conservative numbers.

Let's say I sell just 5 hosting packages per month for 5 years and they are only the economy package. I have it currently on sale where I only make $3 a month profit.

The first year I will have sold 60 plans for a profit of $2160 for the year. This does not include the domain names or any additional services they buy. After year #2 I will have sold 120 plans for profit of $4320. By the end of year 5 I will have sold 300 plans total for a profit of $10800 that will keep coming every year as long as I don't lose any customers. If I just kept that same sales rate for 10 years I will have sold 600 plans for a profit of $21,600.

Now, $21,600 is not megabucks but I am assuming I will sell more than 5 plans per month and I don't think they will all be the economy plan either. That figure also does not include the other services offered or any sales that will result from the mailing list that will be built either. If I sold 50 per month using all the same terms for calculations I will have made a profit of $21,600 in the first year and $216,000 in ten years.

You can play with the numbers anyway you want but I tried to use veryconservative and achievable numbers for the first example and then used more aggressive, but still achievable, for the second example.

Hopefully the article has shown there is a tremendous potential for earning a nice living using reseller programs over the more popular affiliate options. If you are already successful on the internet or you are deciding how to get started hopefully you will now see the potential in reseller programs.

Scott Bianchi operates http://www.best-internet-bargains.com . He writes on a variety of topics. If you would like to be added to his distribution list for his new articles when they are published just send an email to [email protected]