I was on a tech support call recently to set up a client’s server space & do the housekeeping that comes with new websites, and the guy on the other end of the line began the inevitable attempt to upsell for better packages that just happen to cost more than what my client was paying.

As I normally do, I reminded them that I am only the technical contact, and not the account holder, so I really didn’t have any ability to authorize increased charges at this time, but thank you anyway. While this would normally be the end of the sales schpiel, this time I got a different approach: Would I like to become a re-seller?

Now, since I refer a good amount of work to this server company, I already have an affiliate account with them, so I explained that & was told that being a re-seller is different.

It would seem that the new approach for server companies now is to offer designers & developers the ability to take a product from Company A, price it to whatever they want, sell that product to one of their clients, and keep the difference for themselves. This is basically like how Ralph’s can sell you a Snapple for $1.00, but the 7-11 around the corner will price it at $1.49. Same product, different re-sell price.

Despite the tech support guy’s enthusiastic delivery, I chose to decline the offer to become a reseller & remain simply an affiliate. Why? Lemme ‘splain.

An affiliate is someone who basically receives a referral fee for sending customers to a company. (Wikipedia explanation.) Either through a set fee, or a percentage of what is purchased by the customer, the Original Company gives Affiliate Company a small cut for having brought them business they might not have otherwise gotten. This is very common in the marketplace right now – I know one design company that gives a flat 10% for any customer referral that results in a signed contract.

After ten years of working as a designer, I have certain companies that I prefer to work with because they’ve shown themselves to be reliable and moderately-priced to benefit my clients, so I see no harm in working as an affiliate for business I would have sent them anyway, since doing so doesn’t inflate the operational cost to my client.

Resellers, however, cannot say that. This method of marketing causes the customer to pay an inflated price which adversely affects their bottom line.

Example applied to web severs – say your hosting for the year is sold by Server Company for… $60.00. I as your designer could say to my client, “Hey, I’ve got a company that I normally use, and it only costs $80.00.” That $20 difference is then paid to me by Server Company for as long as the client has their site with them, and the client is paying $20 more a year than they have to.

Now, call it wacky, call it having lived in California too long, but as a small business owner, I would have a problem if I found out that a vendor had done that to me, so much to the disappointment of that server company’s tech support, I chose not to tempt karma that way.

So the next time someone makes a referral, it’s not a bad idea to ask if they’re a re-seller. As for me, I’ll stick with just be a lil’ ol’ affiliate. I think it’s safer that way.