Resellers are basically sort of middlemen who purchase large web hosting packages from an upper level web hosting company, and then resell those packages in smaller parts by creating their own packages as are needed by their clients. The major difference between web hosting companies and resellers is that resellers do not actually own the server and therefore have some limited access to it.
They have to refer to tier upper level company to take care of core server issues whenever needed. This can also work to an advantage for them since they are free from the hassles of server maintenance and can fully concentrate on building their client base and providing better support. Usually resellers operate at a local level and thus are in better position to know their client’s needs thereby adding their own valuable added service.