Why Shared Hosting Could be the Best Choice for A Small Business?

Why shared hosting is best for small business
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Shared hosting is one of the cheapest hosting options available for a business or personal website. When a business just started or transferred to an online platform, shared hosting is always the best choice for a startup business. Also, there could be a lack of funds to invest in a website. In that case, shared hosting is a perfect match. 

The shared hosting business has more than a $18.7 billion market valuation and it’s growing every year. Although it is a perfect match for small businesses and highly cost-efficient, however, it has some drawbacks due to its lack of resource issues. It’s so obvious, when you get something cheap it also comes with a lack of quality. 

Here lack of quality means a lack of resources. Which could be a problem for a mid-level business but certainly not for a small business. Anyway, in this article, I will talk about why a small business should utilize a shared hosting option and what kind of drawback it has.

Definition: What is Shared Hosting?

First of all, let me tell you what Shared Hosting is? Many of you may not know yet. In simple terms, shared hosting is like sharing a room with your classmate. Here your website will share hosting space with other websites.

shared hosting is an excellent cost effective choice for a startup business

Let me clear this for you a bit more, think about your personal computer. If your family members share this computer with you for their daily routine tasks like Gmail, Facebook, Instagram, Documents, Movies, etc. And if there are 5 members in your family which means it’s a massacre on a small scale.

Why Shared Hosting is Cost Efficient?

However, it is very cost-efficient when sharing a personal computer with your family members, instead of purchasing one computer for each member. Because 5 members can use a personal computer without breaking it apart and the resources it has should be enough to handle unless one of you is playing high graphic games or using high-end photo and video editing software.

learn why shared hosting is effective for your small business

Therefore, for minimal use, a personal computer for 5 members should be enough. And this is exactly what happened in the shared hosting platform. When 20 small business websites use the same hosting space but none of them has huge visitors, it should be sufficient to handle all 20 websites at once without any serious issue.

But as you can see here 20 websites sharing one server resource which means 100 amounts of resources are divided by 20 and allocated to 20 websites. Limitation of resources is one of the big issues a shared hosting plan has.

Recommended Reading: Best Web Hosting Service for Personal/Business in 2021 (Review)

Upgrade Hosting Plan According to Your Growth

When you start your small business, my recommendation is to use a shared hosting plan. Because initially, you may not require many resources as you will get a few visitors and minimal activities. Therefore, using a dedicated hosting plan would be a waste of money. Rather you should look for a hosting service that offers seamless upgrading options from shared hosting to a dedicated hosting plan.

first start with a cheap hosting plan then upgrade it to a more powerful hosting plan according to your website need

Therefore, when you reach a point where you start to receive 10,000 visitors or more per month you can easily upgrade your current shared hosting plan without getting any hassle of transferring your website elsewhere. Though almost all hosting services provide this seamless upgrading option, hence you have nothing to worry about.

What is the Limitation of a Shared Hosting Plan?

Apart from cost-efficiency, a shared hosting plan has some major limitations that you should know before starting your journey. Earlier in this article, I have talked about sharing a room with classmates.

The danger of Virus Infection

Now think in this way, if somehow one of your classmates catches the flu what would happen to you. It’s so obvious, you and other classmates are in great danger and chances are you might get infected as well. Similar things may happen when your website uses shared hosting. If one of those 20 websites is infected by malware, your website could be in great danger too.

Problem with the Allocation of Resources

Next, I want to talk about limitations in resources. Again let’s go back to sharing a room with a classmate example. In every dormitory, a group of students shares one dining room, one kitchen. If one of your classmates calls over some friends of his and uses the dining table. It may be a slight problem for the rest of the classmates as you may not get enough space.

The shared hosting plan is somewhat similar to the dining room example. If one of those 20 websites got a huge number of visitors in a given time, then at that time other websites may be slowed down. Because a server resource is limited and every website is sharing that resource, so if one of them uses more than their allocated amount then other website performance will suffer. However, most shared hosting services have their own set of rules to cover this limitation. That is, you cannot use more resources than your allocated amount.

shared hosting is best when you need minimal resource & have some budget issues

If in a given time your website receives a huge spike of visitors, then you will get a warning to reduce your resource uses. After a while, if you do not limit your uses then the server administrator will step in and force your website to reduce the resource uses. If that happens, my suggestion is to upgrade your shared hosting plan to dedicated hosting.

There is another drawback of the website slowing down. Google takes it very seriously when ranking a website. If your website has a slow loading speed, then it will be hard for you to get rank. When two websites have the same quality but one has a slightly faster loading speed than others. Then the fast website will outlast the slow website in ranking.

When Should You Choose a Shared Hosting Plan?

If you read this article from the beginning then you might start to think, why should I choose a shared hosting plan when there are so many limitations. Well, it depends on the type of business you are running.

Let’s say, for example, you have a restaurant business in New York City. Most of your customers are from the local area. Yet, you want to open a website for your restaurant to get some more orders online. In that case, your website should be hosted in a shared hosting plan.

10 Factors You should remember when choosing a web hosting service (infographic)
Source: https://hostingfacts.com/

Why is that? Simple, most of your customers are from the local area & for the sake of this example let’s say you have an established customer base for 2 years. This means 90% of your revenue generally comes from local customers who don’t even bother whether you have a website or not. While 10% of revenue may generate from online sales. In that case, you shouldn’t invest in an expensive hosting plan like a dedicated server.

However, if you started to get more sales online and if that proportion is becoming significant day by day, then you should think about upgrading your hosting plan. And of course, unless people started to complain about slow loading speed when ordering from your website. In this way, you can make sure, when it is the best time to upgrade.

Why Dedicated Server is Not the Best Match for a Startup?

Why shouldn’t you invest in a dedicated server right from the beginning? Because it is very expensive and most of its resources may not even get touched by your new website. Thus, it will be a serious waste of money on a new website. Instead, think about a shared hosting plan, most of them can be purchased for around $5-$10 per month.

Another good thing about the shared hosting plan is that – You do not have to worry about maintenance or operating your server. Unlike the shared hosting plan, you have to operate a dedicated server by yourself.

Hence, as you can see, a dedicated plan is best suited for expert I.T professionals or a large company that has I.T experts to operate and maintain a dedicated server for them. In case you have a shared hosting plan you can set it and forget it. And every operation and maintenance will be done by your hosting provider. Even if you run into some troubles, you can open a support ticket and they will help you to fix it.

Alternative Option When Upgrading a Hosting Plan

If you want to upgrade your hosting plan, then VPS hosting can be a great choice for small to medium businesses. Which promises a dedicated resource for your website. However, it is still shared by a few other websites but, unlike shared hosting, it has more premium control over resources and security.

Your second upgrading option could be Cloud hosting if your business is mainly online based. And most of your revenue comes from online orders. In that case, Cloud hosting can be best for you. As it holds several copies of your website on different servers, hence if one server has broken down it won’t affect your website at all.

And finally, if your business is large and has I.T experts then you can choose to have a dedicated server for your business.


After reading my article, you should know by now what you have to do. But again, my advice is to plan for your website in a cost-efficient way. First start with a shared hosting plan then upgrades it according to your business growth. However, if you do not have any budget issues & want to start with premium resources right from the beginning. In that case, you should use a dedicated server for your site.

One more thing I forgot to mention in the article. Nowadays most dedicated hosting service has on-demand server maintenance option available for an extra cost. Thus, if you do not have any budget issues you can still operate a dedicated server just like a shared hosting plan.