Careers Business Ownership The Advantages of VPS Hosting for Your E-Commerce Start-Up Share PINTEREST Email Print nikom khotjan/Getty Images Business Ownership Industries E-commerce Retail Small Business Restauranting Real Estate Nonprofit Organizations Landlords Import/Export Business Freelancing & Consulting Franchises Food & Beverage Event Planning eBay Construction Operations & Success Becoming an Owner By Ajeet Khurana Ajeet Khurana Ajeet Khurana has worked as a business consultant for more than two decades and served as CEO for the Society for Innovation and Entrepreneurship in 2014 and 2015. He started as CEO at Zebpay in 2018. Learn about our Editorial Process Updated on 04/09/19 Your e-commerce business is ready to go to the next level, but you aren't sure if you should continue with your shared hosting account or upgrade to a Virtual Private Server (VPS). This is not a decision to be taken lightly because the website is the heart of any e-commerce operation. Here are some compelling reasons why VPS is the best choice. Shared Hosting Limitations Many shared hosting providers claim that you will have unlimited resources and the ability to run dozens of programs that can be installed with a single click using software such as Fantastico. They will promise you the moon to sign you up. However, make sure to read the fine print. There is no such thing as "unlimited" disk space, bandwidth, or CPU usage. When your e-commerce business grows, and your website runs several scripts to offer all that incredible functionality to customers, your hosting will hit a wall. Avoid a Shared SSL Certificate Some shared hosting providers lower their costs, and your prices, by offering a shared SSL certificate. SSL ("secure sockets layer") is a protocol that creates a secure connection between the client and server. So imagine the uncertainty your customers will feel when they see a warning message that the SSL certificate does not match your domain name. It is likely that this will drive off your customers. For this reason, shared hosting should be considered for an e-commerce website only in two situations: You are setting up a fully functional prototype website as a precursor to your actual hosted site. You are setting up a niche website where customers already have a relationship with you and are not likely to get put off by slow speeds and shared SSL certificates. VPS: A Happy Beginning for E-Commerce No one wants to spend more money than necessary, but a business can really suffer if it's trying to run on limited resources. Although the initial outlay may be slightly larger, it is vital to get the server choice right the first time. Make sure to select a provider that will be able to support the business for at least a year, to avoid having to switch to a new hosting provider midstream. However, that does not mean that you must choose dedicated hosting (or colocation) right away. Dedicated hosting tends to be too expensive for most self-funded e-commerce startups. The good news is that VPS comes in as a happy compromise. Initial costs can be as low as $15-$20 per month. How Does VPS Work? VPS involves a shared server that is "split" into several virtual servers by use of virtualization software. These servers are imaginary (since they are all just one server, not several), but they are strictly defined and managed by the virtualization software. Based on the hardware setup you purchase, the virtual computer will be allocated with the specified number of CPU's, RAM, disk space, and bandwidth. Many hosts allow for automatic expansion beyond these resources while others enforce them strictly. Benefits of VPS All the advantages of a VPS over shared hosting arise from the fact that the resources are isolated and pre-allocated. Here are some of the key benefits: Isolation from the Activity of Others on the Same Host If another user on your host's services is misbehaving, this will have little to no impact on your VPS service. If another user's activities crash their server, it won't crash yours. In fact, only their virtual machine crashes. This has no impact on the physical server on which the virtual machines are run. Guaranteed Speed No matter what anyone else is doing on another VPS hosted on the same machine, you are guaranteed your speed. If you have two CPU's allocated to you, then you will always have those two CPU's available to your operations. The amount of RAM you have paid for in a VPS setting will always be available to your operations, regardless of what else is happening on the physical machine. If you have used shared hosting before, you know that its speed varies based on the time of day and the amount of traffic on the websites of other users. Your resources are being distributed on a first-come-first-served basis. This never happens on VPS services. Your resources are dedicated to your e-commerce website. Guaranteed Stability While shared hosting is notorious for hiccups, VPS does not experience any such interruptions. Again, this is due to the virtualization software, which divides the resources, making a dedicated machine with dedicated resources for your e-commerce site. Guaranteed Space Many shared hosting providers that claim to provide unlimited disk space shield themselves in some kind of "fair use" clause. In other words, the resources must be fairly shared between all users of that server. That translates to limited disk space. With VPS hosting, you never have to worry about that. You have an agreed upon disk space that is paid for monthly and is reserved exclusively for you. It sits there, either used or unused, but paid for and allocated to you. Root Access If you are technically strong, you might need root access to install some programs. You will never get root access in shared hosting. Root access begins at the VPS level of hosting. Make sure to read the manual or talk to your hosting provider if you think you might need root access. VPS is the way to go for a serious e-commerce startup. Shared hosting is an adequate environment for testing. When it comes to taking the plunge, however, budget for a VPS plan. It is much cheaper than dedicated hosting while being much more robust than shared hosting.