Blue geometric background with overlapping triangles.

Customer Story

Ecommerce marketing company grows fast, adopts tax automation

Results

Cost savings

Integrated systems

Improved processes

Increased compliance

Company Overview

Based in Austin, Texas, Diamondback Branding supplies promotional products. Since 2012, the company has been printing and engraving drinkware, coolers, and other gear ranging from earbuds to lighters.

Tax challenges

“We grew relatively fast,” says Diamondback founder and Chief Executive Officer William Lovelace. “We went from a garage in New Mexico to roughly a $15 million-per-year company.”

 

That rapid growth brought a new level of scrutiny to the business’s sales tax compliance. Diamondback was an ecommerce company doing business in multiple states but collecting tax in only one. “We hit the point that everybody was looking at us,” William recalls. “We’re primarily wholesale, but the nexus laws generally don’t care. We were breaking nexus thresholds in dozens of states. It quickly became a nightmare.”

 

“We wanted to get ahead of the game,” William continues. “We preemptively took action to avoid a bad audit.”

Why Avalara?

“I did research and I’d heard of Avalara,” says William. “While I hadn’t had any interaction with them, it was on my to-do list because I knew we had to automate tax calculation and filing eventually.”

 

When the time came to make a move, William found Avalara to be the easy choice. “Avalara was the option that integrated with Brightpearl, our ERP, so it was kind of a no-brainer,” he recalls. “We started testing the integration in July 2019 and we went live in January 2020.”

“With Avalara, we have the clarity that when a law changes or a tax rate changes, we don’t have to worry about it. We know everything we’re working with is regularly updated and we feel secure.”

  • — William Lovelace
  • Founder and Chief Executive Officer

 

Results

William lists several benefits of automating his sales tax calculations. “You’ve got time saved for one thing,” he says, “because it would probably require one, possibly two, full-time administrator jobs to calculate and report everything manually. Every single one of those jurisdictions would have to be calculated in a spreadsheet, reported, and paid.”

 

“For a company our size, we have a lot less staff than most people would think,” William explains. “About half the company works in production, engraving or printing the products that we sell. We have a very small administrative staff. We try to get on top of technology and stay there so that we don’t have people who just sit there and push buttons.”

 

“On top of that,” William continues, “with Avalara we have the clarity that when a law changes or a tax rate changes, we don’t have to worry about it. We know everything we’re working with is regularly updated and we feel secure.”

Ready to see what Avalara can do?

Schedule a demo to see our solution.