Here are more details for you -
https://forumweb.hosting/15837-when-should-i-use-reseller-hosting.html
Reseller service -
If you are new to the hosting filed and you would like to manage your customers by third party then you can have the reseller service. Your client will feel that you have your server and managing it by yourself. Reseller service provides you the platform for selling the shared hosting services to your clients or when you would like to host multiple accounts with their separate panel on the same server then you can have the reseller service. Under it, you can create your own packages and can assign them to your accounts as per the requirement of the account.
Drawback of it is that , you won't have the root access . Reseller service has the root access with your hosting provider. You can not manage it by your own.
Advantages of VPS service-
1. Management of VPS - If you are familiar with hosting field then you can have the VPS as it is managed by yourself.
2. Root Access - It's your own server, you have the root user access for it.
3. TOS - You can define the terms of services for your clients on VPS.
4. Resources - You will have the full resource allocation as it's your server. You can utilize it for your server as you wish.
Hope this will clarify the use of reseller service