Reseller in general term :
The term Reseller according to the vocabulary/Dictionary means to sell again i.e. to sell a product or service to the public or to an end user, especially as an authorized dealer, while making sure that you make a profit on the sale.
Reseller hosting is no different either, a reseller order a Web hosting package from a hosting company and attempts to sell it independently. The profit for the reseller lies in either the discount or in the commission she/he gets from selling an account.
Normally as the customers increase, so does the profit margin for the reseller.
You can have more flexibility with your web hosting accounts.
You can save money.
You can earn more revenue at little cost to yourself.
You can focus on customer support and leave technical support to your web host.
Your web host, not you, absorbs server maintenance costs.
Your service is only as good as your upstream provider. If the server is frequently down, for example, you may lose clients.
If you ever have to change web hosts, the move will be an inconvenience for your clients. its always better to have your own VPS or Dedicated server if you want to start with your hosting business. always try to get webhost who offers you managed services.