Reseller hosting offers fewer resources than a dedicated server, and thus may exceed resource constraints faster than with a dedicated server.
A reseller hosting account can only hold so many clients before the space and bandwidth are greater than any reseller package the hosting company can provide, and it becomes more economically feasible to upgrade to a dedicated server.
Upgrading the reseller package requires moving clients from the reseller account to the dedicated server, which could result in downtime. In addition to the moving and expansion issues, most reseller hosting accounts offer little in terms of customization.
Reseller accounts are usually set in what software is installed on the box, and the versions available. An example would be a client asking for PHP 5, when the version that's installed on the server hosting the reseller account is PHP 4,means it decreased.
Some hosts may be happy to upgrade and accommodate, other hosts will not be able to upgrade as fastly.
Reseller accounts should be selected in much the same manner as standard hosting accounts. The first reason to not choose a host is if they offer "unlimited" space or bandwidth.
The services and resources the reseller hosting account offers. Some will only allow a certain number of SQL databases, email accounts, domains hosted, and even a certain number of customers that are allowed to be hosted.
We receive the amount of resource we will need for our reseller business. There are several good resources to check when considering potential reseller hosting companies.
Two good industry resources are WHT, also known as Web Hosting Talk a discussion forum related to the web hosting industry, and an online news and information source on dedicated servers and reseller web hosting.