Last updated: 2026-07-19
What Is an SLA (Service Level Agreement)?
Definition
A Service Level Agreement (SLA) is a formal contract between a service provider and its customers that defines the expected level of service, usually measured in uptime percentage (e.g., 99.9%). SLAs typically specify remedies if the agreed service level is not met: service credits, refunds, or contract termination rights.
Why it matters
SLAs set clear expectations between you and your customers. They protect both sides: customers know what reliability to expect, and you know what happens if you fall short. For B2B SaaS companies, SLAs are often required in enterprise contracts. Without monitoring, you cannot know if you are meeting your SLA.
Example
A company promises 99.9% uptime in their SLA. That allows up to 43.8 minutes of downtime per month. In January, they had 52 minutes of downtime due to a database issue. Per the SLA, affected customers received a 10% service credit on their next invoice. The monitoring data from PingWatchdog provided the evidence needed to calculate the exact downtime and issue accurate credits.
How PingWatchdog helps
PingWatchdog tracks your uptime percentage in real time and generates historical reports you can share with customers. If a customer questions whether you met your SLA, you have timestamped data showing every check, every incident, and your overall uptime for any date range. This makes SLA reporting and credit calculation straightforward.