Businesses Achieved 153% ROI with Avalara for Managing Tax Compliance According to New Total Economic Impact Study

SEATTLE, WA — February 14, 2024 — Avalara, Inc., a leading provider of cloud-based tax compliance automation for businesses of all sizes, today released a new Forrester Total Economic Impact™ study to help businesses experience the significant time and cost-savings provided by Avalara’s software solutions for tax automation and compliance.

To read the 2024 TEI study visit avalara.com.

Avalara commissioned Forrester Consulting to conduct an independent study of the total economic impact of Avalara. The research included an in-depth look at both quantifiable and more subjective benefits organizations report by leveraging Avalara for sales tax calculations, tax returns, exemption certificate management (ECM), and more. A composite organization, based on six  businesses with experience using Avalara, achieved a three-year 153% ROI with a payback period of less than six months, and a net present value of $465,000, after employing Avalara and moving away from manual tax compliance management and other legacy systems.

“Avalara’s tax compliance platform provides meaningful ROI for businesses that rely on our solutions to eliminate manual tax and compliance processes,” said Liz Armbruester, EVP of Customer and Compliance Operations at Avalara. “These new independent study results showcase what tens of thousands of our customers already know with Avalara – that tax compliance automation can significantly decrease the time, cost, and other resource burdens of tax on businesses, while also improving their overall compliance and operational efficiency.”

Prior to Avalara, the businesses analyzed for this TEI study managed tax compliance processes manually which was slow and more prone to errors.  Each business faced even more challenges leveraging legacy systems such as compliance risk, as well as insufficient tracking and storage of tax documents, which put unnecessary strain and burden on employees. With a need for a digital modern tax compliance solution that would drive efficiencies, the businesses interviewed for the TEI study leveraged Avalara and saw measurable results including:

• Time savings across tax compliance requirements: Businesses streamlined the process of  managing, preparing, and filing tax returns by 85% — saving 510 hours annually. Additionally, businesses saved 416 hours every year managing exemption certificates and 34 hours on preparation time per audit. Businesses also saved 384 hours annually, which had been previously spent on researching tax rates and laws.
• Cost savings across tax compliance requirements: Similar to time savings, businesses saved more than $83,000 on tax return management over three years. Additionally, businesses saved $96,000 on exemption certificate management, and $210,000 on audit preparation over the same three-year period. Businesses also saved $150,000 annually that would otherwise be spent on third-party experts.
• Unquantified benefits: Businesses reported additional value from Avalara, including decreased sales tax liabilities, reduced shipping errors, enhanced confidence in tax compliance, improved confidence among customers, and more.

After the investment in Avalara, businesses shared they were able to improve their compliance with tax laws and requirements, leading to improved confidence and lower risk of additional costs applied due to non-compliance.

According to a senior tax director at a manufacturer: “When I’m not on Avalara, we’re on a good day only 25% to 30% compliant. And when you get on Avalara, you’re probably 95% to 100% compliant. That’s the big difference to me.”

“Avalara keeps us in compliance with the ever-changing tax rules. States continue to make changes and Avalara keeps us informed and up to date on these changes. Having them as part of our team gives us confidence in how we are doing business,” said Kurt Toliver, CFO at Asurvio, LP​.

“Avalara products, encompassing Cert Capture, AvaTax, and Avalara Returns, have not only spared us the need for an additional full-time employee but have also streamlined our sales tax audit process, saving us countless hours,” said Julia Gilroy, Manager, Accounting Services at Emser Tile, LLC.

“Avalara significantly aids my company in streamlining the calculation, filing, and payment of sales taxes in an efficient manner. It simplifies the entire process by automatically calculating the estimated amounts owed and electronically filing our sales tax returns. AvaTax also helps us stay informed about sales tax rates and tax laws in various locations, enhancing our compliance with local regulations to a great extent,” said Emma McClellan, Senior Tax Accountant at EquipmentShare.

Avalara solves tax compliance for more than 41,000 businesses around the world. To learn more about how Avalara can automate your tax compliance requirements, please visit avalara.com.

Avalara makes tax compliance faster, easier, more accurate, and more reliable for 41,000+ business and government customers in over 75 countries. Tax compliance automation software solutions from Avalara leverage 1,200+ signed partner integrations across leading ecommerce, ERP, and other billing systems to power tax calculations, document management, tax return filing, and tax content access. Visit avalara.com to improve your compliance journey.

This study is a commissioned study conducted by Forrester Consulting on behalf of Avalara and results are based on a composite organization. From the information provided in the interviews, Forrester constructed a Total Economic Impact™ framework for those organizations considering an investment in Avalara. The objective of the framework is to identify the cost, benefit, flexibility, and risk factors that affect the investment decision. Forrester took a multistep approach to evaluate the impact that Avalara can have on an organization.

Tommy Morgan
media@avalara.com