How Therabody Streamlined Global Tax Compliance with Avalara: A Success Story
Therabody Streamlines Global Tax Compliance with Avalara
In today's complex global economy, efficient tax compliance is crucial for businesses expanding their reach. Therabody, known for its innovative wellness technologies, faced significant challenges in navigating this landscape. To address these concerns, the company turned to Avalara, a leader in tax compliance automation. Their partnership has helped Therabody streamline tax processes and enhance operational efficiency, particularly in the face of increasing compliance requirements.
The Growth of Therabody
Therabody has been on a remarkable journey since launching its flagship product, the Theragun, in 2008. This instrument pioneered percussive massage therapy, enabling users to experience quick muscle recovery and improved performance. With over 30 devices and the establishment of wellness centers and educational programs across the United States, Therabody has significantly expanded its footprint in the wellness industry.
However, with growth comes complexity, and Therabody's compliance responsibilities quickly escalated. Due to the South Dakota v. Wayfair decision, Therabody's tax obligations surged from eight states in 2019 to an impressive thirty-two states by 2020, marking a pivotal shift in the company's operational landscape. Additionally, as Therabody ventured into international markets, it was confronted with challenges linked to GST and VAT compliance, including varying tax structures and reporting requirements across different countries.
The Shift to Automation
Recognizing the need for a more efficient approach to tax compliance, Therabody had been utilizing Avalara's AvaTax since 2018. This established relationship allowed Therabody to maintain oversight of their tax compliance processes, but the rapid growth required a more robust solution. In 2023, Therabody decided to implement Avalara's Exemption Certificate Management (ECM) to address the increasing complexity of managing exemption certificates effectively.
By onboarding and validating over 2,500 customers and more than 5,200 certificates, Therabody dramatically enhanced its efficiency and reliability in tax compliance. Vivek Dadhania, Tax Manager at Therabody, expressed, "Our partnership with Avalara has been instrumental in managing our indirect tax compliance amidst rapid growth and international expansion." This partnership enabled Therabody to focus on its core business development and future growth initiatives rather than getting bogged down by compliance issues.
Integrating with Business Systems
In 2024, Therabody upgraded its operations further by adopting Shopify Plus for its B2B portal, enhancing its retail point-of-sale systems. An essential component of this project included syncing transactions with NetSuite and Avalara AvaTax to ensure accurate tax calculations and filings. With Avalara for Shopify, Therabody successfully extended these integrations to its website, guaranteeing that customers would encounter precise global tax rates at checkout.
Additionally, leveraging Avalara's comprehensive tax code database and AI tools allowed Therabody to classify its product SKUs effectively and apply exemptions with minimal manual input. The tax team has since enabled the validation of 25 to 30 new certificates daily, which significantly has alleviated the pressure of managing tax compliance complexities and reduced the potential for errors.
Positive Outcomes and Future Prospects
Therabody's automation journey with Avalara led to substantial time savings and reduction in manual errors across tax filings in over 50 state jurisdictions. By adopting these advanced technologies, Therabody can better allocate resources toward strategic initiatives and provide enhanced customer service.
Liz Armbruester, EVP of Customer and Compliance Operations at Avalara, highlighted, "The results from successful partnerships like Therabody demonstrate the power of Avalara's comprehensive tax compliance automation solutions. Our integrations with platforms like Shopify and NetSuite allow customers to save precious time on compliance operations while ensuring accuracy."
As Therabody continues its growth trajectory, it is well-prepared to tackle the complexities of tax compliance with Avalara's support. This success story exemplifies how leveraging technology can foster operational efficiency while easing the burdens of compliance in an ever-evolving business landscape.
Conclusion
Therabody's partnership with Avalara serves as a testament to the benefits of automating tax compliance processes amidst rapid company growth. This collaboration highlights how businesses can not only manage compliance effectively but also concentrate on their core missions without being hindered by taxing operational challenges. For more insights into how to enhance tax compliance and improve efficiency, visit Avalara's website and explore their comprehensive offerings.