Language
An agency sells hosting for GEL 50 and sees a much smaller supplier bill. The difference looks like profit until service time becomes visible. Help with a mailbox, an overdue renewal or a small evening incident belongs in the economics, even when it has no separate invoice.
Start with a hypothetical monthly model: GEL 250 in shared costs and GEL 8 in variable cost per active client. These figures illustrate arithmetic; they are neither SERVER1 prices nor a real agency result. Count support time in the category assigned to it in your model, without adding it twice.
| Active clients | Share of common cost | Variable cost | Unit cost |
|---|---|---|---|
| 5 | 50 | 8 | 58 |
| 10 | 25 | 8 | 33 |
| 20 | 12.50 | 8 | 20.50 |
At five clients, a GEL 50 price does not cover the GEL 58 unit cost in this example. At ten, each unit costs GEL 33 and leaves GEL 17 from the selling price. This is where two different measures matter:
Margin = (50 - 33) / 50 = 34%
Markup = (50 - 33) / 33 = 51.52%Margin uses selling price as its denominator; markup uses cost. Do not substitute one percentage for the other in an offer. For a 30% margin on a cost of GEL 33, calculate 33 / (1 - 0.30). Rounded upward to two decimal places, the minimum price is GEL 47.15.
The worksheet works when time is counted
The model has a boundary: support requirements may change as the client count grows. Additional capacity, a licence or more staff time may become necessary. The cheaper unit at twenty clients does not establish an automatic profit. Leave a line for what changes at the next operating step.
Before setting the price, check taxes, payment fees, onboarding and one-off work separately. Do not add an item again if it already sits inside GEL 250 or GEL 8. A short transparent model is valuable when you can update it by the same rules next month.
Compare reseller hosting through this model and confirm current plan limits. If management requirements grow, assess Managed VPS as a separate operating option. Reconcile customer promises with the selected service scope.
For building the operation: Reseller Hosting for Agencies: How to Build a Client Hosting Operation.
References to compare with the model: SERVER1 - Reseller hosting.
