Abraham says reseller domain markup cost him up to $40K

Nick Abraham says he wasted $20,000 to $40,000 on domains in a single quarter by buying all of them through his infrastructure reseller instead of direct from a registrar.

The gap is the whole story. Abraham says resellers buy domains from places like GoDaddy, DNSimple and Dynadot at around $8, and he was paying $19 each. At roughly 1,000 domains a month, that spread compounds fast enough to show up as a line on a profit and loss statement rather than as a rounding error on an invoice.

He says he did not notice at the time because the reason he bought through the reseller was convenience. His words are that he figured a domain costs the same everywhere, and that he did not want to buy them himself and set up the name servers. The catch came a quarter later, when he looked at the P&L and could not work out why infra spend had gone up so much when sending capacity had barely changed.

What he does now

Abraham's fix keeps the reseller in the stack but moves the purchase. He buys the domains himself directly from the registrar, points the name servers at the reseller, and has the reseller provision the inboxes. The operational work he did not want to do stays with the vendor, the markup does not.

The second half of the fix is the audit. He says to check infra spend against sending capacity every quarter, and if spend is climbing faster than capacity, look at domain costs first. That is the signal that caught it for him, not the per domain price, which looked unremarkable in isolation.

He is not calling the markup a scam. "Resellers should make a margin on domains, but I should have checked what I was paying sooner," he wrote.

Nick Abraham

@NickAbraham12

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Resellers should make a margin on domains, but I should have checked what I was paying sooner.

For people sending, the size of the leak scales with how many domains you cycle through. At a few dozen domains, an $11 spread is noise. At Abraham's stated volume of about 1,000 a month it is the difference between a reasonable infrastructure bill and a quarterly five figure one, and nothing in the invoice tells you which you are looking at unless you put spend and capacity next to each other.