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Single- vs Multi-Tenant: Everything You Need to Know About Cloud Application Environments

When reading about how eCommerce software applications are used, you might have come across the term “tenancy.” The dictionary will tell you that tenancy is the possession of a piece of property over a period of time. In cloud computing, tenancy has a similar meaning: it refers to an infrastructure (IAAS) and platform/software (PAAS/SAAS) shared among different customers.

Let’s consider an apartment building. It contains many common elements, such as exterior walls, mechanical equipment, utilities, and so on. That’s your IAAS. HOAs or apartment managers charge property management and maintenance fees – but unlike maintaining a house, there’s way less hassle and cost associated with managing an apartment. Similarly, your PAAS and SAAS provider takes care of upgrades and maintenance, so you don’t have to.

What Is a Multi-Tenant Cloud?

Like apartments, a multi-tenant cloud setup offers many tenants storage and access. But sharing comes with some downsides. Just like having unpleasant next-door neighbors, some brands will use more shared resources than others. While it’s not completely impossible to address this issue at the hypervisor or architecture level, a single-tenant setup could be a more attractive proposition. In either case, there are many decisions IT teams must make in order to ensure their operational objectives are met.

house-apartment

Single-Tenant vs. Multi-Tenant

To continue the real estate analogy, a single-tenant environment is like a single-family house. Like in single-family homes, single-tenant customers share municipal utilities with their neighbors (IAAS), but the walls, roof, and HVAC systems (the SaaS instance) are theirs.

Thus, the main difference between single-tenant and multi-tenant architecture is the number of software instances on each. A single tenant model consists of one platform user running a single platform codebase on their website. In a multi-tenant scenario, the single codebase is shared between a limitless number of users. As illustrated by the image below, the second scenario reduces costs but does so at the expense of user convenience and control.

single-vs-multi-tenant

So how does single-tenant support more complex environments, like B2B? 

According to Xngage CEO and Chief Digital Executive Joe Albrecht:

“Single-tenant cloud solutions can combine advantages such as scalability, elasticity, and managed infrastructure and platform services with the need for data segregation, regulatory compliance, integration into back office systems, and organizational control, often found in B2B environments.”

In this post, we will examine the differences between single- and multi-tenant environments and the benefits and drawbacks of their use in eCommerce.

Setup and maintenance

With single tenancy, the customer must deal with higher costs. A single-tenant environment demands more resources during setup, maintenance, or customization. Since eCommerce vendors must maintain new instances for each new user, these costs are usually transferred to the customer.

Multi-tenancy can be a more economical option because costs associated with maintenance are shared across the architecture. It also requires less effort for setup, upgrades, and maintenance, as the vendor usually performs these functions.

Verdict: When compared to a multi-tenant setup, setting up a single-tenant eCommerce environment can take more time and effort. It requires more upkeep and resources to maintain the infrastructure. At the same time, single-tenancy gives you more control to optimize these activities.

Speed and performance

The main factors impacting performance in a single-tenant setting are the demands placed on the application, infrastructure, and the hardware supporting the environment. A multi-tenant environment adds to these layers, which can impact both the overall system and individual tenants.

It’s important to note that many modern multi-tenant systems utilize advanced mapping and resource distribution mechanisms. Some multi-tenant vendors also offer heightened performance and dependability to their customers for an additional cost. 

Verdict: Since the performance of a single-tenant application is not affected by another’s performance, the single-tenant environment is the better-performing of the two. It’s a great choice for large, established brands as well as for smaller brands on a growth path.

Backup and restoration

A single-tenant application gives you more control over backups and recovery. Since a backup includes both the code and data of a single instance, this process is straightforward and allows for easy restoration to any previous version.

Many multi-tenancy vendors either have complex backup procedures or don’t offer any backup at all. For those that offer premium or dedicated backup options, not all vendors can satisfy the data and security policies of every customer.

Verdict: If you need to quickly and easily back up your eCommerce applications on your schedule, your best bet is a single-tenant environment. If you’re considering multi-tenancy, make sure their premium and dedicated backup features are sufficient for your needs.

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Security and dependability

In a single-tenant setup, your environment is yours and yours alone. Without shared elements, there are no possible data accessibility points between tenants.

In a multi-tenant setup, by contrast, there is only some isolation of single and shared databases. With more access points, attackers can more easily take advantage of systems or exploit their vulnerabilities. For customers, this translates into a higher chance of being targeted with a malicious attack.

Verdict: No matter how good a multi-tenant architecture is, at the end of the day a single-tenant eCommerce environment will be more secure. With a single-tenant system, every instance is completely separate from every other. There are no elements shared between tenants, making a single-tenant environment a more dependable and future-proof option for many businesses.

Scalability and efficiency

A single tenant architecture is considered more scalable and reliable when pitted against multi-tenant applications. In a single-tenant model, every customer has their own virtual machines and host hardware.

In multi-tenancy, since resources are shared, they can be utilized more effectively by the vendor. A multi-tenant system can shift resources where needed, and when combined with storage and hardware virtualization, can help reduce vendor costs.

Verdict: If you want scalability, single-tenant is the way to go. You can run your eCommerce instance locally or use your own virtual machines and hardware. Unlike the multi-tenant setup, another tenant’s activity won’t affect your performance, and you can scale capacity quicker as demand changes.

Control and customization

With single tenancy, the customer gets more control over what’s included in their software. From updates, to upgrades and maintenance schedules, customers get more flexibility in managing their environment.

A multi-tenant environment offers less control, so many features remain universal for all tenants, while only a select few are open to customization by the customer.

Verdict: When the time comes to customize your eCommerce store, a single-tenant environment makes it easy. That’s because a single-tenant platform allows for more things to be tracked and adjusted, giving you more control over how the software looks, feels, and behaves. Furthermore, there’s always an option of installing additional software components, which is rare with multi-tenant software.

5 Reasons to Go Single-Tenant in B2B eCommerce 

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At first glance, multi-tenancy might seem like an attractive option. It reduces some costs and complexities for both eCommerce vendors and customers. For example, the customer’s costs are reduced since updates and fixes only need to be applied once. However, customers also have less control and flexibility over their eCommerce environment. Let’s take a look at some reasons when you should select a single-tenant environment whether you run a B2C or B2B eCommerce business.

You need to maintain a competitive advantage in your industry

Since multi-tenant applications share features that are used and marketed by everyone, they limit how businesses can compete with each other. Also, remember that multi-tenant customers are all subject to upgrades and maintenance at the same time. This can be a real problem for sellers that operate in different time zones as the maintenance schedule can fall during their peak hours.

You want full operational control over your environment

For B2B sellers in highly regulated businesses or serving demanding customers, having complete control of their eCommerce environment is only possible with a single tenant system. Whether it’s the implementation, the framework, or built-in settings, more control means a unique eCommerce experience. This flexibility is crucial for conducting improvements and optimizing a large business.

You require top-notch security capabilities

Built-in security features offered by multi-tenant eCommerce platforms may be inadequate for some businesses. After all, there is a chance (although remote) that personal data could leak from one eCommerce store to another. While this may not be critical for most small B2C stores, it could be a deal-breaker for larger B2C and B2Bs that deal with large volumes of SKUs, customers, or revenue.

You have complex business hierarchies

If your organization works with or delegates specific responsibilities to business partners, a multi-tenant solution may pose a security risk. Some eCommerce businesses have complex back-office hierarchies that involve other companies. Others utilize in-house security expertise with their own software protocols and guidelines. A single-tenant environment can accommodate these and other business requirements.

You need a future-proof platform

While a multi-tenant framework is a comfortable option with fast onboarding and simpler upkeep, it’s not the ideal solution for all. Large, discerning businesses need the flexibility offered by single-tenant systems. They can’t let growth impede their success. These businesses need the flexibility to pivot and expand to new markets, and they need platforms that keep them at the cutting-edge of their industries.

How Animal Supply Company Solidified Their Business With Single-Tenancy

Just as you’d rather house a family of five into a single-family home rather than a small apartment, the same is true for businesses. Single-tenancy is a scalable, proven, and often, the only logical solution for established businesses looking to grow and expand their reach with the stability and security of cloud-based solutions.

It’s the approach taken by Animal Supply Company (ASC), a leading pet goods distributor and retailer in the United States and the Caribbean. Over decades of organic growth and growth through mergers and acquisitions, ASC now operates a web of regional warehouses and support centers across the US. 

As ASC inherited new warehouses, ERPs, and legacy systems, their operations grew more and more fragmented and complex. They needed a way to break down their data silos and streamline the buying experience for their retailers, partners, and business customers.

As a rapidly growing brand, ASC could not compromise on capacity demands, scalability, or connectivity. They had no room for less-than-perfect security protection for their partners and end-customers. Therefore, ASC required a sophisticated, robust B2B eCommerce platform that would support dozens of ERPs and complex eCommerce workflows demanded by their retailers. 

Only a single-tenant environment could support ASC’s order management and headless platform, positioning them for continued growth in their industry. 

animal-supply-infrastructure

Making the Right Decision for Your Business

Now that you know the pros and cons of single-tenant and multi-tenant systems, which one is right for your business? 

Multi-tenant architecture is quickly evolving, and for many small-scale B2C eCommerce businesses, it’s a great starting point. However, forward-thinking developers, growing B2C, and B2B eCommerce brands should give serious consideration to a single-tenant environment. When it comes to scalability, security, and added control, there’s just no other equal.

For B2B eCommerce businesses in particular, the granular control offered by single-tenancy is vital. For these companies, the increased flexibility to customize their store, the ability to back up data, and exercise control over maintenance is mission-critical.

The more you can control your digital environment, the better you can fine-tune for more efficiency, higher sales, and a better experience for your customers.

Contact us to find out how Oro Inc. can meet your infrastructure requirements and sales goals.

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