Reseller hosting is ideal, but the whole web hosting community likes to offer cheap cost rate packages so it's really hard to make your identity different. In my opinion, it's not all about the price I think providing decent customer support is more important. Undercutting is not the best way or approach to hosting. Your focus should be on clients satisfaction, because these days a lot of people frustrated with big belly hosting companies. One more thing, local market should be your prime concentration area at initial stage...