One man Web Hosting shops - making the best use of your resources
The reality for many small one man web hosting outfits is a life in which one must wear several different hats, sometimes all at once. This article takes a look at an all too familiar buzzword in the form of automation. We also take a look at outsourcing, a term which is often connoted with some negativity. Both are methods by which a one man shop can maximize resources such as time and capital. It is a known fact that the human mind can only remember 6-7 items in its consciousness at the same time. With such limitations it is clear to see that it is impossible for a small one man shop to handle every aspect required from a host especially at a time when customer demands from their service provider are at an all time high.
There will be a gross simplification of the tasks a small hosting operation needs to perform in this article. Most tasks can be grouped into the following four sections:
* Sales and Marketing
* Finance / Customer Management
* Administration and Management
In an ideal situation, you would be able to delegate all aspects of your web hosting company except for top level administration and management to subordinates, freeing up your time which can be put to more productive use (developing the company brand name and planning the future direction of the business). For a small one man hosting outfit this is not possible so the four sections above need to be evaluated. The idea is to determine the sections most important to the growth of the business and find methods of automating or outsourcing other tasks.
With the technological advancements in the hosting industry, from automated control panels and scripts that simplify creation of accounts to complete turnkey solutions from the likes of service providers such as Alabanza, ResellerClub and Mosso there is no excessive need to worry about spending time on the actual product sold to the customer. A high end reseller account or a managed dedicated server solution provides the bare bones product without the need to hire support technicians and experts to maintain your service. Of course due diligence is required on your part when sourcing a supplier.
Whilst products such as ModernBill and ClientExec exist to help your billing and customer management needs, the three providers mentioned in the previous paragraph have more exciting products that not only provide you a solid product to sell to your customers but also provide automation of finance, billing and customer management related tasks. Alabanza, the most established of the trio provide a reseller manager that allows you to bill clients, create packages and set pricing. There is unfortunately no end support to your clients directly from Alabanza. ResellerClub offers greater automation providing a complete functioning site within minutes of setting up an account with them.
Mosso provides the best product of the three, offering you a dual platform hosting product (Windows and Linux). Mossos Hosting System gives you access to the latest internet technologies on their clustered setup located on the RackSpace network. Their premium product is supplemented with end user support which can be purchased for each individual domain hosted on the Mosso system.
If you decide to opt with one of the three providers above or a company that provides a similar solution, you have freed up a good portion of your starting capital which would have been expended on expensive business software, providing your service and developing your website. The automation of several key tasks will also save you time which can be put to good use in the one section we have not yet considered automating or outsourcing. Your sales and marketing efforts will bring in the clients that will fuel company growth and thus its advisable to keep this aspect of your business in house.
It is expensive and an unnecessary hindrance to the growth of your business to outsource your sales division to another company. Furthermore building relationships with your clients is important in the modern hosting market and an outsourcing company which most likely will place emphasis on achieving the minimum target by any means possible is likely to burn a territory (i.e. wastage of leads) which is not productive. Since your sales efforts are effectively the only contact the outside world will have of your company and its brand, it is important that you keep the sales function in house. An outsourcing company is unlikely to care about your brand and its image as much as you will.
As a compromise a lot of small hosts set up affiliate schemes. A carefully planned affiliate scheme with plenty of backup / support material and a meaty compensation plan can bring about dividends and for a small hosting provider on a limited budget is a much safer alternative to throwing cash away onto the advertising flame. In a rather ironic twist, Verio and similar sized hosting giants invest a lot of money into telemarketing / direct marketing campaigns, bringing in thousands of subscribers. This form of marketing generates maximum sales for minimum cost and is perhaps one of the most efficient ways to bring in the sales that will fuel company growth.
It is a shame that many small hosting providers do not use such marketing to tap into their local markets to build up a client base that will generate the cash flow needed to be reinvested into the business for exponential growth. With providers like Vonage and software like Skype providing VOIP telephone services it is possible for a small one man hosting operation to set up a mini call centre within the confines on ones own home office at extremely low cost. Perhaps the limiting factor that turns many small businesses away from direct marketing is a lack of experience and criminal lack of resources from which to hone the skills required to run a successful campaign.
It is almost accepted practice in the hosting industry that start ups should begin with reseller accounts and expand when necessary. Equity and control over the product is slowly gained as the provider moves to renting dedicated servers and eventually purchasing their own hardware. If one is able to give up so much control on the actual product supplied to end customers then surely it makes sense for complete outsourcing and automating of several key functions as well. Regaining control of these functions (e.g. moving to an in-house billing system or switching to a product like ModernBill) can be done when it makes business sense to do so. The aim of this article was to provide food for thought for aspiring small hosting providers the evolution of the hosting market means you no longer have to do everything yourself take advantage of the plethora of products and services available to you it makes business sense to do so!
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