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Difference between SKU and Tenant in multi-tenant SaaS application


SKUs define what you get. Tenants define who gets it in a securely isolated way. A SaaS provider benefits from SKUs for tiered pricing and multi-tenancy for efficient resource usage.

 SKU (Stock Keeping Unit)

  • Features and Pricing: SKUs in a SaaS application typically dictate the set of features, functionalities, and usage limits (e.g., storage, number of users, API call volumes) available to a customer.

  • Customer Choice: Customers choose an SKU based on their needs and budget. Higher-tier SKUs usually offer more capabilities and resources at a higher cost.

  • Within a Tenant: A single tenant (customer) can only be subscribed to one SKU at a time, but may potentially upgrade or downgrade over time.

Tenant

  • Data Isolation: A tenant represents a logically isolated instance of the SaaS application dedicated to a specific customer or organization. A customer's data, configurations, and often customizations are kept completely separate from other tenants.

  • Multi-Tenant Architecture: Most SaaS applications are designed as multi-tenant. This means multiple tenants share physical infrastructure and the core software codebase, improving resource efficiency for the SaaS provider.

  • SKU Relationship: The SKU a tenant is subscribed to determines the features and resources available within their isolated environment.

Example

Let's consider a cloud-based CRM SaaS application:

  • SKUs:

    • Basic: Limited contacts, storage, basic reporting
    • Professional: More contacts, storage, advanced analytics
    • Enterprise: Unlimited contacts, custom integrations, dedicated support

  • Tenants:

    • Company A subscribes to the 'Professional' SKU. They have their own isolated CRM instance with the features and limits dictated by that SKU.
    • Company B subscribes to the 'Basic' SKU. They have a different, separate CRM instance with the functionality provided by the 'Basic' SKU
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