Dylan’s Candy Bar Masters Compounding Tax Complexity with Avalara as It Expands into New Countries, Channels, and Candies

Is chocolate caramel popcorn food or candy? When taxing a Farmers Market Mason Jar, do you tax the gummy peaches, cherries, and watermelons separately from the mason jar itself? These are the types of questions Dylan’s Candy Bar, the largest state-of-the-art sweets emporium and lifestyle brand, is faced with when it comes to taxes. Managing a global, omnichannel business for the world’s best sweets caused the Dylan’s Candy Bar accounting team to find itself in the middle of a tax maelstrom. To combat the global tax complexities of selling candy and accessories worldwide, Dylan’s Candy Bar implemented the Avalara tax compliance suite to mitigate risk as the company accelerated growth.

"The company was on its third consecutive sales tax audit when I arrived,” said Lois Browne, Vice President of Finance at Dylan’s Candy Bar. "It was really grueling. Every time an auditor came in we would have two people completely dedicated to that for at least three weeks. Our exposure was so high, we couldn’t afford not to prioritize it.” Browne expanded, "After implementing Avalara we answer with such confidence and authority; the auditors can move on to someone else.”

Last year, Dylan’s Candy Bar was looking to expand into additional domestic and international brick-and-mortar properties and put an increased emphasis on ecommerce. During this time, the company implemented new technologies to improve accuracy and efficiency and to support the company’s growth strategies. Now, across all of its financial and resource planning technologies, Dylan’s Candy Bar relies on Avalara to manage its tax compliance requirements.

For growing businesses like Dylan’s Candy Bar, common triggers of new tax requirements include expanding product offerings, selling into new geographic areas, or implementing new back-end planning technology. For Dylan’s Candy Bar, all of these triggers happened concurrently. Today, the company has 21 store locations in the United States including its flagship HQ in New York City, carries more than 7,000 types of candy, and is visited annually by more than 6 million customers. The company has plans to double its ecommerce sales within the next two years.

"Our role as an accounting team is to keep ahead of the business growth. 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,” said Browne.

In order to keep pace with Dylan’s Candy Bar growth, Browne implemented three Avalara products: AvaTax for calculating sales and use tax; Avalara Returns, for automated filing in every U.S. sales tax jurisdiction; and Avalara CertCapture, for tax document and exemption management within its supply chain. Benefits seen by the team include:

• As the company expands into new geographies, AvaTax is already prepared to determine sales tax for the new locations — a process that can take some businesses months without automation technology. With AvaTax, Dylan’s Candy Bar saved more than $100,000 annually in back taxes, interest, and penalties.
• With Avalara Returns, Dylan’s Candy Bar has 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.
• Tax exemption certificates are managed in a searchable cloud environment, with expirations, renewals, and missing certificates flagged automatically to the accounting team.

"Tax management can be a burden at best, and a barrier to growth at worst. Browne and her team at Dylan’s Candy Bar are using tax technology to efficiently plan to enable growth for the company. Putting Avalara in place to automate and stay ahead of growth has proven to be an asset for the accounting team and Dylan’s Candy Bar overall. We continue to celebrate its success, and hope for a pop-up in Seattle someday,” said Scott McFarlane, CEO of Avalara.

For more information about how Dylan’s Candy Bar uses Avalara to support tax compliance across all areas of its business, read the full case study.

ABOUT AVALARA

Avalara helps businesses of all sizes get tax compliance right. In partnership with leading ERP, accounting, ecommerce and other financial management system providers, Avalara delivers cloud-based compliance solutions for various transaction taxes, including sales and use, VAT, excise, communications, and other indirect tax types. Headquartered in Seattle, Avalara has offices across the U.S. and around the world in the U.K., Belgium, Brazil, and India. More information at avalara.com.

ABOUT DYLAN’S CANDY BAR

Dylan’s Candy Bar was founded in 2001 by Dylan Lauren with a mission to awaken the creative spirit and inner child in everyone. Renown for merging the worlds of art, fashion, and pop culture with candy, Dylan’s Candy Bar is a pioneer in changing the way we see candy. As the largest state-of-the-art sweets emporium and candy lifestyle brand, Dylan’s Candy Bar is not your average "candy store.” The modern-day candy land is home to over more than 7,000 candies from around the world, making it the most popular destination for the ultimate sugar rush experience.

Dylan’s Candy Bar stores are currently located in New York City, Los Angeles, East Hampton, Miami, and Chicago as well as several wholesale venues around the country. Dylan’s Candy Bar plans to continue expanding to major cosmopolitan cities in the U.S. and worldwide. For more information, please visit DylansCandyBar.com.

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