A reseller is a company or individual that purchases goods or services with the intention of reselling them rather than consuming or using them. This is usually done for profit. One example can be found in the industry of telecommunications, where companies buy excess amounts of transmission capacity or call time from other carriers and resell it to smaller carriers.
They are responsible for interfacing with his/her own customer base, but any hardware, software and connectivity problems are typically forwarded to the server provider from whom the reseller plan was purchased. Being a profitable reseller firm usually involves extensive advertising to get customers. While the monthly fees with major hosts are only a few dollars a month, it’s a low margin business, and resellers must devote large advertising budgets to compete with established competitors.
According to the Institute for Partner Education & Development, a resellers’ product fulfillment-based business model includes a corporate reseller, retail, direct market reseller (DMR), and eTailer; less than 10 percent of its revenue comes from services. Resellers are known to conduct operations on the Internet through sites on the web.
For example, this occurs where individuals or companies act as agents for ICANN accredited registrars. They either sell on commission or for profit and in most cases, but not all, the purchase from the registrar and the sale to the ultimate buyer occurs in real time. These resellers are not to be confused with speculators, who purchase many domain names with the intention of holding them and selling them at some future time at a profit. Resellers, by the very nature of their business are retailers.
Another common example of this is in the web hosting area, where a reseller will purchase bulk hosting from a supplier with the intention of reselling it to a number of consumers at a profit.
Software and eBooks are two products that are very easy to obtain by resellers. Their digital format makes them ideal for internet distribution. In many cases, such as brandable software, the reseller can obtain even the right to change the name of the software and claim it as one’s own and resell it on an eBook shop hosting platform.
A reseller is responsible for interfacing with his/her own customer base, but any hardware, software and connectivity problems are typically forwarded to the server provider from whom the reseller plan was purchased. Being a profitable reseller firm usually involves extensive advertising to get customers. While the monthly fees with major hosts are only a few dollars a month, it’s a low margin business, and resellers must devote large advertising budgets to compete with established competitors.
