What is white label hosting?
White-label hosting is a franchise agreement to use another company’s products and services as your brand. The offeror is usually a solid, established company, while the recipient is a small company with a limited capital base.
Let’s use this example: Company A is a multi-million dollar web hosting company and Company B is a small home-based web business. Company B wants to create a lucrative business on the Internet, but does not have a large investment budget, but partners with Company A to use their web products and services. Company A agrees to charge an annual or monthly subscription fee and provide administrative support to Company B.
This business agreement is mutually beneficial for both companies, even if one is fully established. So the question is asked: “How effective is this for the business world?” Research has shown that many small internet marketing businesses today are moving towards white label web hosting to get their piece of the multi-billion dollar internet marketing pie.
Why White Label?
While white labeling uses a company’s trade name to market products and services that belong to another official company, it creates opportunities for both markets. Corporate businesses allow small businesses to benefit by using their already established products and services and this helps large corporations to expand their businesses into other areas in small pockets.
White labeling also allows entrepreneurs to place brand names on the items they sell, giving the company full credit and commissions from sales without disclosing the supplier’s brand name.
How do big companies benefit in general?
Corporate businesses benefit from charging a reseller fee or license much like a franchise agreement. This is often affordable as these funds provide customer support, business processing, and other administrative services for the subscriber.
Additionally, awarding white label contracts takes the pressure off larger companies when it comes to retail marketing. White label web hosting could be similar to wholesale. As wholesale providers, small businesses can remarket their products and services to retail customers.
Web Hosting Reseller Benefits
Finally, thousands of resellers today are benefiting substantially by setting up a retail web hosting business. They have less overhead, inventory, personnel, and administrative functions to handle. The biggest benefit for these small companies is the fact that they have BPOs (Business Process Outsourcing) that take care of the technical problems of their clients.
If you want to be a white label web hosting reseller, you are in for a lucrative opportunity. Join hundreds of digital marketers incorporating their businesses with web hosting and domain name services for their clients.