Four-fifths of resellers branching into web hosting can make a profit within twelve months, research has claimed.

Web hosting specialist Fasthosts Internet surveyed 793 UK VARs, 80 per cent of which indicated the addition of a web hosting offering proved profitable within a year. Two thirds claimed they found it easy to cross-sell web hosting to their existing customer base.

Half said reselling hosting had allowed them to increase the average length of service per client while 70 per cent claimed they would recommend delving into web hosting to similar companies. 61 per cent claimed it had cost them less than £500 to start selling web hosting and 64 per cent said overall revenue per client had increased since reselling web hosting.

Fasthosts claim, in the current economic climate, web hosting offers VARs a lucrative opportunity with annuity revenues and high margins at minimal risk. The company indicated that resellers can charge top dollar for white label hosting offerings with services including consultancy and web design wrapped around.

Steve Holford, chief marketing officer at Fasthosts, said: “In recent months, demand for reseller web hosting has been brisk as more IT related SMEs are seeking to diversify and add strings to their bow. By offering web solutions alongside existing services, many businesses find that they can bolster their revenues and protect their client relationships”.