Hosting Articles

10 Common Web Hosting Mistakes

March 10, 2009

With so many Web hosting companies on the Web today, there are some common hosting mistakes that you should recognize and avoid. Some of these can lead to the demise of a new Web hosting business, unless they are caught and corrected right away. Both your business and customers will thank you for avoiding these common mistakes.

1) You must spend money to make money

There are many low priced Web hosts on the Web today. Some seem to offer tons of goodies for almost nothing. However, you will only save money if you are able to compare apples to apples. Now, I am not saying that you need to go with the most expensive host – high prices do not necessarily guarantee quality. Regardless of the price range, you should check the track record of a host through the many avenues that are usually available: forums, uptime monitors, and even testing their responsiveness to answering questions and fixing problems.

Just as you would not build a house on a shoddy foundation, make sure that your Web host, the foundation of your presence on the Web, is as solid as possible. Remember that despite claims to the contrary, 100% uptime is not a reality, but you will want the best that you can find.

2) Friends/Family and business do not mix

If at all possible, avoid utilizing friends or family members to finance your startup costs or to keep your business afloat. Too often this happens and a business fails, resulting in loss of friendship or resentment within a family.

If you do accept assistance from friends or family, minimize the risk to them by tapping other financial sources as well. Make sure to pay back their investment in you as soon as you can, and be honest with them if you can't repay their loan right away.

3) Marketing

Imagine that you have the next best product or service since sliced bread – but you fail to tell anyone about it. How strong do you think your sales will be? To sell your product effectively, you must let people know where you are and what you have to offer them. There are various ways to do this, but you should exercise caution until you are sure that your marketing efforts will result in sales.

Advertising is one way to market yourself and your service. However, you do not need to spend tons of money in the beginning. Word of mouth advertising costs nothing, and is a very effective way of building your business. Other frugal advertising methods include adding a signature to all outgoing emails with your Web address and a brief statement regarding what you offer. For instance: "Looking for affordable Web hosting? Visit example.com".

4) Business Plan

If you wouldn't put together a computer without following directions, why would you launch a business without the framework of a business plan? A solid business plan will focus your ideas and help you develop an effective niche market, where you can outdo the competition. While there are many out there who offer affordable Web hosting; only you bring your own unique skill set to this business. Ask yourself what you can do differently from so many others, and use that as your mission statement.

You can find samples of business plans on the Web or books at your local library.

5) Use Resources

One important resource that you can use is the Small Business Administration (SBA). The SBA may be able to offer you many services from advice to loans. You can also receive free advice from the SBA, which can be a valuable resource itself. Contact them early in the process of starting your hosting business, which may be able to get you on track and avoid many of the pitfalls that can develop with any small business.

6) Record Keeping

This is very important as this will make life easier if your business is audited or when it comes time to figure out if your business made any money. Develop a bookkeeping and business organization system that works for you, whether this is electronic or even in an old shoebox. Keeping yourself and records organized will go along way in the eyes of many customers as well.

7) Reinvesting in your business

Success in a business is not determined solely by the incoming cash flow. Remember, not every dollar which comes into your business is income. Income is determined by subtracting your expenses from the sales.

Do not purchase items and put them as business expenses if your business cannot afford them. The same goes for salary. If you are a sole proprietor in the United States for instance, you do not receive a salary, but can draw from the business assets.

Keeping track of the money flow, what comes in and goes out, will help to keep you out of trouble should you need to issue a refund to a customers or other situations. Also remember to reinvest in your business as this can reduce your reliance on outside funds. You can consult a financial advisor if needed.

8) Competition

Remember that you will have competition in your Web hosting business. This is an unavoidable fact. However, you do not need to do things exactly as they do. Find something that separates you from your competition, whether it is support, services, etc. Don't let cost be the only thing that sets you apart from your competition.

Don't copy the competition, become the competition! Be creative about both your products and your style.

9) Linux Server Administration

Linux is the most commonly used server environment you will run into on the Web. If this is a platform you plan to offer customers, make sure that you learn the basics of Linux. This is important, especially if you plan to operate your own server, because it is the basic platform of your business.

10) Unlimited bandwidth/disk space

Have you ever seen an unlimited hard drive? They do not exist. So don't offer unlimited disk space. Bandwidth, also, is not an unlimited resource. You will generally pay for a certain amount of bandwidth that you can then resell to your customers. Do not offer unlimited bandwidth either – it will only lead to disgruntled clients when, in the future, you do have to impose bandwidth limits.

Offering unlimited bandwidth and disk space generally attracts those people who truly do use unlimited amounts of space and bandwidth, with no regard to the money that you must pay to provide it. (Think tenants who crank up the thermostat when heat is included in their rent!) Make sure that you clearly state how much disk space and bandwidth comes with your service so everyone respects reasonable limits.