Hickory Farms transforms for growth

Since 1951, Hickory Farms has been a leading retailer of food gifts and specialty foods online, in catalogs, with mass merchants and supermarkets, and in more than 750 seasonal, retail shopping locations.

As Hickory Farms expanded its business strategy, it found “technical debt” to be an inhibitor. Systems that worked fine for the old ways of doing things were coming up short in the new model. “We needed a technology infrastructure that would enable our growth, rather than being a barrier,” recalls COO Matt James.

Sales tax compliance, in particular, quickly emerged as an area of increasing complexity. The company packages both food and nonfood items, which are taxed at different rates, in the same gift box. 

Its multichannel approach added further complexity, as shipping for online and catalog sales are often taxed differently. The company’s retail footprint alone requires sales tax collection and reporting in 46 states, with taxability determination at the local level proving even more complex.

In early 2016, Hickory Farms selected Microsoft Dynamics 365 for Finance and Operations as its new ERP system.

Choosing a system to handle the company’s increasingly complex sales taxes was the next priority. Driven by strong recommendations from Microsoft and the implementation partner, Matt and his team landed quickly on Avalara’s AvaTax to automate sales tax calculations and Avalara Exemption Certificate Management for managing exemption certificates and compliance.

“Avalara was early in partnering with Microsoft and being ready for the cloud and for Dynamics 365 for Finance and Operations,” says Matt. “Being early can come with its own challenges, but we saw some advantages in testing out the new platforms and making sure they’re working for us.”

While getting out of the datacenter business was a must-have for Hickory Farms, Matt also acknowledges some nice-to-haves offered by Avalara’s platform, for instance, the ability to consolidate sales tax calculation and address verification for shipping in Commerce Cloud Digital, the company’s ecommerce system.