What is White Label Hosting?
White label hosting is a franchise agreement to use another company’s products and services as your brand name. The offeror is usually a solid and established business while the offeree is a small business with a limited capital base.
Let’s use this example: Company A is a multimillion-dollar web hosting enterprise and Company B is a small home-based web business. Company B wishes to create a lucrative internet business but does not have a large investment budget but partners with Company A to use its web products and services. Company A agrees by charging a yearly or monthly subscription fee and provides administrative support for Company B.
This business arrangement is mutually beneficial to both companies even though one is fully established. The question is then asked: “how effective is this to the business world?” Research has shown that many small internet marketing companies today are moving towards white label web hosting to get their slice of the multibillion-dollar internet marketing pie.
Why White Label?
While white-label is using a company’s business name to market products and services belonging to another official company, it creates opportunities for both markets. Corporate companies allow small-sized businesses to profit by using their already established products and services and this helps large corporations to spread their businesses to other areas in small pockets.
White labeling also allows entrepreneurs to place brand names on items they market thus giving the company all the credit and commissions from sales without revealing the suppliers brand name.
How Do Major Companies Benefit on a Whole?
The corporate companies benefit by charging a resellers fee or license just as a franchise arrangement. This is usually affordable as these funds provide customer support, merchant processing, and other administrative services for the subscriber.
In addition, granting white label contracts take the pressure off larger companies when it comes to retail marketing. White label web hosting could be similar to wholesaling. As wholesale suppliers, small businesses are able to remarket their products and services to the retail customers.
Benefits To The Web Host Reseller
Finally, thousands of resellers today are profiting substantially by establishing a retail web hosting business. They have fewer overheads, inventories, staff and administrative functions to handle. The greatest benefit to these small enterprises is the fact that they have BPO (Business Process Outsourcing) who take care of their customers’ technical issues.
If you would like to be a white label web hosting reseller, a lucrative opportunity awaits you. Join hundreds of digital marketers who incorporate their businesses with web hosting and domain name services for their clients.
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