Many e-commerce companies dream of hitting it big on social media and watching their sales go through the roof. What's not to like, right? But not only does that dream come with a whole lot of hard work, like scaling your marketing, customer service, and logistics, it comes with unexpected complications as well, such as sales tax compliance.
When Chris Garcin's friend, Chuck Mumford, came across a pair of military supply sunglasses eight years ago on a ski trip in Idaho, they knew they were onto something. Chris quickly set up a website and after selling 10,000 pairs of these military style-sunglasses, they launched a crowd-sourced campaign to increase production of the now popular Pit Viper sunglasses. Now with sales in over 30 states and growing, Chris and team have a sales tax compliance platform that provides convenience and peace of mind.
Like many other U.S. retailers, Pit Viper was directly affected by the 2018 South Dakota vs Wayfair Supreme Court ruling that determined states could set their own economic nexus thresholds. As a young and growing company, Pit Viper wasn't sure how the ruling would impact their business.
As the company grew, it needed a strategy to manage sales tax compliance.
Fast eCommerce growth = more sales tax responsibilities
The combination of the Wayfair ruling and the company's fast growth made finding a sales tax solution top priority. Pit Viper was growing fast and reaching nexus in many new states. Understanding the complexity of sales tax, the team decided to outsource.
Chris said it all started with nexus: "We really just wanted to know where we had reached nexus. And how can we do this accurately and reliably, over and over again."
They needed a solution that offered automation, along with nexus tracking capability. Keeping these features in mind, their search led them to a solution that they believed fit the bill but during the implementation process, Chris and Neil started second-guessing their choice.
Making the switch to TaxJar
As the integration progressed, Pit Viper raised concerns about their chosen sales tax partner. "We were focused on running our business and finding a partner that could handle the taxes and take that off of our shoulders," Neil said. "It seemed that [their initial solution] still put the onus on us to figure out absolutely everything that needed to be figured out. And in doing so, there were many balls dropped on their side. And that took more time and cost us more money in not only filings but back filings."
After Pit Viper was set up and integrated with the software tool, they met with a company representative to talk through outstanding issues.
"I think after we got off that call, Neil and I talked, and we're just like, this isn't the right partner," Chris said. "We need to find someone else that cares about our business, and will actually take this compliance issue that we have and help us figure it out and file taxes for us."
With a better idea of what they wanted from a partnership, the team evaluated a new slate of candidates to step in as their sales tax solution. This led them to TaxJar. "Although [ending one partnership and needing to start another] added a lot of time and frustration, I think we ended up in the right place," Chris said. "And now we're extremely happy with TaxJar."
In addition to providing great service quality, TaxJar was the lowest cost option for Pit Viper. "With all those back filings we ended up having to do," Chris said, "Neil went through and laid out everything that we were going to end up being charged from the [the initial solution]. Even given all the onboarding and everything that we needed to do to move solutions, it was still going to end up being cheaper, in the long run, to go with TaxJar."
Having the right partner
Pit Viper was happier with the sales tax software implementation the second time around. Neil said, "I felt that the onboarding process was super easy."
Their TaxJar representative explained the onboarding process, provided helpful videos, laid out tasks for the team, and provided an overall understanding of the TaxJar website portal."I thought that was really useful," Neil said, "and made it really easy to register and onboarding each state."
Pit Viper also has an integration with Shopify and finds the reporting and filing of sales tax with TaxJar to be seamless.
The Pit Viper team is currently enrolled in TaxJar's AutoFile in 30 states. The resources TaxJar provides helps the team onboard new states efficiently, which is a world away from where they started their sales tax journey.
Do your homework and avoid choosing the wrong partner
When asked what advice Pit Viper would give other eCommerce companies searching for a sales tax solution, Chris and Neil were clear: "Personally, I'd say don't bother trying to set up with a [competitor] and go directly to TaxJar. Just to do it once with the right partner instead of twice. Don't pick the wrong partner first."
Also, do your homework. "This is a big partner that you're bringing on, it controls a lot of the cash that you have to spend on taxes, and find the right partner that works for you. And for us, due to convenience, support, and cost structure, it was TaxJar."