What is overselling?
In web hosting industry, It is a concept in reseller web hosting where your provider either allow or disallow the limits of your disk space and bandwidth. If over selling is denied you cannot allocate disk space or bandwidth higher than your limits which can limit your re-seller business.

What are the benefits of overselling allowed?

If you have overselling allowed then you can allocate higher disk space and bandwidth without any limits so that only your actual disk usage by all websites will count. It is very good for small businesses to offer big hosting packages to their clients.

Let me share example from Tezhost Reseller 1 package.

Tezhost Reseller 1

Unlimited Websites

5GB Storage Space (OverSelling allowed)

100GB Bandwidth (OverSelling allowed)

Unlimited MySQL DBs

Unlimited E-mail Addresses

Free SSL for All Sites

Access to WHM Interface

Here first of all there is no limit on websites creation. Next due to overselling allowed you can allocate Economy (5GB diskspace, 100GB bandwidth) and Deluxe (10GB diskspace, 200GB bandwidth) to a lot of websites. Once your sites start using the space and gradually reach in about 6 months to an year to 5GB limit. You can ask for upgrade to Reseller 2 and so on.

An average website require a space of not more than 500MB. Also an average website uses a bandwidth of less than 5GB per month. So, in start most of the sites are less in size and grows with time. So you can charge websites low for the first year but high for the next year. Overselling give you the facility to allocate higher disk space to your users and it help in starting your own reselling business from a very low cost.