One of the most dominant types of referral relationships online would be the reselling of website hosting. This is where an ISP or company that provides hosting bills you and you in turn bill the client. Here are two examples of how something like this may work for you:
- Hosting Company X charges $29.95/mo for hosting or $24.95/mo if you pay all year up front. You have the option of being billed or having your client, the entity whose site is being hosted, pay directly. If the client pays through you, you can charge whatever you want or think is fair; anything over what X charges is your profit.
- Hosting Company Y is picky about who their resellers are, and ask all to fill out an application and then sign a long legal contract. Y also charges you, the reseller, a membership-type fee of $250 annually. Y normally charges $49.95/mo for a good hosting package, but for all of the accounts who come through your reseller relationship, you get 30% off. This makes the above hosting package around $35/mo. Y suggests you charge $49.95/mo and keep the difference though technically, you could charge whatever you wanted to. If one year of your client's hosting gave you a profit of approximately $180/year, you would need to host only two clients per twelve months to make back your membership fee; the rest is yours.
Also, it has come to my attention that some hosting reselling relationships have turned into pyramid schemes also known as MLM (multi-level marketing). For example, some companies will sell space for say $20/mo to person A. A then lets folks know he's selling webspace at the low low price of $25/mo. Person B takes him up on it, and sells the space to his client, person C, for $30/mo (and so on in some cases). While I'm not against the concept of making money, these types of things do concern me. If person C has a problem with the service, who is responsible? B because that's who he pays? A because that's who B pays? The original hosting company because they run the equipment? Are C or B aware or who the real company is? Yes, it's a labyrinth, and to me, this may not be the best way we can serve our clients; we may prefer to have a direct relationship with the vendor so that we're not lost in a chain of mystery if there is a problem or question. Anything designated as non-MLM would indicate that they do not allow continual sub-reselling, and you may decide you prefer that type of relationship.
