Rapha partners with Avalara to automate sales tax and support global growth

Rapha was founded in the UK in 2004 with the aim of making ‘the world’s finest cycling clothing’. As well as designing and selling clothing and accessories, the company sponsors leading cycling teams worldwide and uses digital content to reach cyclists all around the world to help to grow the sport. It operates 21 clubhouse ‘hubs’ for Rapha Cycling Club members and local cyclists in 11 countries in Europe, North America and Asia.

As cycling’s popularity boomed globally, Rapha quickly expanded beyond the UK. Today, three quarters of its revenue comes from mainland Europe, the US and APAC region. This is largely driven by online sales that create a range of complex tax obligations.

As Dan Safe, Group Finance Manager - Financial Reporting, explains: “Automating sales tax was an absolute necessity for us, as it reduces the burden and strain on manual processes and our internal teams. Sales tax automation gives us peace of mind and the confidence to expand into new geographical areas.”

The team at Rapha chose to partner with Avalara in 2018 to automate their sales tax calculations for their SAP Hybris Omni-channel Commerce Cloud solution. AvaTax has a prebuilt certified integration with SAP Hybris and the team at Rapha were looking to find a global solution that provided UK-based support.

With AvaTax, Rapha could be confident that the integration with SAP Hybris would give them an integrated tax experience that worked inside their software to automatically calculate and apply the correct sales tax for every transaction. Without the support of an expert partner such as Avalara, keeping on top of all the global tax rates would otherwise have been a hugely time-consuming task for the team at Rapha.

Dan Safe continues: “The tax landscape is complex and ever-changing, compliance is often difficult to manage for retailers. Having confidence in your sales tax automation means you can enter new markets and channels and generally be more responsive to customers.”

That responsiveness to customers is key for such a customer-focused business as Rapha. Across the whole company, Rapha is focused on building its brand and giving excellent customer service.

As the COVID-19 pandemic unfolded, and new audiences rediscovered the joy of cycling, Rapha’s online sales boomed. Web revenues increased and the customer base grew. Rapha, like most businesses, had to manage changing priorities and adapt its strategy to ensure that post-pandemic, they emerge stronger.

Furthermore, sales tax automation has meant a reduction in workload for the Rapha finance team, freeing up their time to focus on other priority areas as they manage growth.

Rapha trusts AvaTax to charge customers the correct rate of sales tax, and the software makes reporting simple. AvaTax Returns allows the team to review a single combined liability worksheet and file returns in every jurisdiction with just one click.

Automation has been an important part of Rapha’s digital development, with benefits across the business. Dan Safe says: “With so many of our sales coming through the website, we’ve seen particular benefits for our tech teams, trading, finance and compliance, and also indirectly our customer teams who have seen a welcome reduction in questions about sales tax. My advice to anyone considering automating their sales tax and compliance is simple – do it!”