First of all you'll need to decide the resources you wish to allocate to the VPS accounts.Accordingly you must decide the Dedicated Server.Before deciding the resources for the VPS's,bear in mind that you need to keep some resources free inorder to cope with the spikes.It would be better to get in touch with the host for better assistance.
As suggested by Walter,you can use VMware ESXi as this is free.This can save hardware, power, cooling and administration costs for you.One can also run multiple operating systems on a single server with ESXi.
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