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Candy retailer uses the cloud to comply with tax mandates

A new solution is helping Dylan’s Candy Store master its global tax complexities.

The candy retailer manages a global omnichannel business, however selling candy and accessories worldwide made it difficult to stay abreast of all tax mandates. By adding a cloud-based tax compliance suite from Avalara, Dylan’s is primed to mitigate tax risks as the company continues to grow.

The retailer, which operates 21 store locations in the United States including its flagship headquarters in New York City, carries more than 7,000 types of candy, and is visited annually by more than 6 million customers. The company also has plans to double its e-commerce sales within the next two years. However, this growth was taking its toll on auditing processes.

“Audits were really grueling. Every time an auditor came in we would have two people completely dedicated to that for at least three weeks,” said Lois Browne, VP of finance at Dylan’s Candy Bar. “Our exposure was so high, we couldn’t afford not to prioritize it.”

The new solution is applied across all of Dylan’s financial and resource planning technologies to manage new tax requirements related to the company’s expanding product offerings, selling into new geographic areas, and implementing new back-end planning technology. A cloud-based environment enables the company to manage tax exemption certificates, and expirations, renewals, and missing certificates are now flagged automatically to the accounting team.

Since adding the solution, Dylan’s can determine sales tax for the new locations, a process that can take some businesses months without automation technology. The company has saved more than $100,000 annually in back taxes, interest, and penalties.

Dylan’s Candy Bar has also eliminated the countless hours of labor it used to take to pay each jurisdiction individually. Dylan’s Candy Bar now makes a single ACH payment, which Avalara uses to pay each jurisdiction individually, and on time, according to the retailer.

“Our role as an accounting team is to keep ahead of the business growth,” said Browne. “For a company with growth goals like Dylan’s Candy Bar, being ahead of supply chain, purchasing, and sales teams is as strategic as it is stress-relieving. There is a different tax requirement for each item we sell, and being able to manage that confidently is an asset to our team.”
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