Starting a Small business: Web hosting is the Way to Go

Web hosting
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Becoming an entrepreneur is no child's play, and things can be quite tough in the beginning, and life is really hectic even once you get going, and your venture turns profitable. For those who’re planning to start a small business, web hosting is certainly a great choice, but it doesn't require heavy investments upfront.

Of course, the profit margins would be fairly low, but then when you consider the fact that you can start a hosting business at literally zero investment, it's certainly quite a reasonable option.

When you compare web hosting with other businesses, you can break even during the very first month, because all you need to recover is the cost of purchasing a reseller hosting package, setting up your own website, and promoting it on the web smartly.

Now, having said so, there’s no dearth of hosting resellers on the Internet, and the chances are quite low that you’d be able to stand out of the crowd, unless you really do something different. Sure thing, you may do some PPC marketing, and drive organic traffic through SEO, and resell a few hosting packages, but then you won’t be able to make big money in the longer run with that approach.

Plan in Advance

So, what you really need to have in mind is future expansion in a planned manner; if you’re planning to set-up your data center couple of years down the line, then it’s not going to happen all of a sudden. You’ll have to raise funds for the same, and that can only happen with meticulous planning.
Hence, forming a good business plan will pretty much decide the future of your business. Of course, executing those plans would be equally important, but if you go wrong in the planning part, then there’s no way you can expect good results at all.

Decide a Back-up Plan

Although you’re not risking a lot of money, you’re certainly investing a good deal of time, and you need to have a back-up plan if things are not working.
Confidence is always great, but overconfidence can be bad from business perspective, so you ought to have a Plan B in place. If you’re just hoping that you won’t fail, and working without a back-up plan, then you’re certainly asking for trouble.

You Must Know When It's Time to Move On

And, it's also equally important to identify when things are not working for you, because struggling to promote a business with minimal profitability for too long isn't such a wise idea. When we look at a small business like web hosting, you shouldn't expect very high profits right from the word go, but the progress must be noticeably.

You may want to take a look at this article giving you some rough estimates of the amount of money you can make, as a hosting reseller, if you manage to promote your business successfully. On similar lines, if initial monthly profit is $500, and it grows to only $1000 by year of first year, it is certainly not progress, because it’s 100% increase. On the other hand, if it’s just $600 even at the end of first year, then certainly you need to look at the root of the problem, and try to boost up monthly profit margins over next 3-6 months. And, if it still doesn’t really happen, then should realize that it can only be a supplementary source of income, and such a business can never become your bread and butter.
Likewise, if you manage to push your profit margins to $1000/month, but get stuck at that level for 2 years, you should see where you're going wrong, and then weigh your options, rather than blindly continuing with the hope of improving the bottom-line with sheer good luck.

Last but definitely not the least; you must have your thoughts cleared out about starting your own data center after a certain level, and having a certain number of customers in your portfolio. Once you start your own data center, your profit margins will go up manifolds, and you’ll have plenty of opportunities to boost your revenues henceforth.

So, go ahead and give it a try, but you must remember that trying the same old stuff won’t really work in this fiercely competitive hosting industry, and you ought to create your USP as a host, even if you're reselling the hosting packages.

Just the way GoDaddy has created its name with those controversial yet so effective videos, and GoDaddy girls, you need to think of a solid branding and marketing strategy to catch the attention of the mass.
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