Introducing the 2017 Winners

AmeriGas

Tax solutions that provide rapid time-to-value and scale

Winner for use of Vertex Indirect Tax O Series and Vertex Indirect Tax Returns

AmeriGas is the nation’s largest retail propane marketer, serving more than two million customers in all 50 states from approximately 1,900 distribution locations.

Innovation at Work

Calculating and reporting on propane sales is highly complex, with variables spanning where and how much product is sold, how it is being used, and how it is being delivered. When the weather turns cold, business—and tax complexity—heats up for AmeriGas. Yet its legacy tax engine was burning out under pressure, and the company lacked a formal process for updating sales tax rates at vending machine locations across the country. AmeriGas sought a new approach, a more reliable tax engine, and partner that could deliver it all against a highly aggressive five-month timeline.

With the new tax engine touching every order and invoice created in SAP, the company’s business and technical needs would put virtually every capability of Vertex O Series to work. The implementation team from Grant Thornton had to address 2,000+ custom impositions, 60,000+ customer exemption certificates, and 5,000+ custom rules—implementing standard functionality whenever possible. AmeriGas also set prioritized replacing or automating manual content and processes.

Under intense scrutiny by AmeriGas senior leaders, the team delivered on time. The results have been rapid and tangible. Among them: more accurate tax calculations, enhanced determination and cleansing of customer addresses, streamlined compliance process, improved batch processing, and a lesser dependency on the IT resources needed to support the tax function.

In Their Words

“We leveraged the full power of Vertex O Series—including custom impositions and imposition types, limited certificates, custom tax and situsing rules, tax assist and lookup tables, and advanced taxability mappings.” — Margie Morris, Corporate Tax Manager

Duracell

Leading the charge and staying ahead of new VAT compliance requirements

Winner for use of Vertex Indirect Tax O Series, Vertex Tax Performance Engine, and Vertex Indirect Tax Returns

The iconic Duracell brand, which started in the 1920s, has grown to be the leader in the single-use battery market in North America and is known the world over. Its products serve as the heart of devices that keep people connected, protected, entertained, and mobile. Duracell’s recharging technology allows consumers to live life without limits.

Innovation at Work

Duracell was seeking a tax solution for value added tax (VAT) compliance that would also improve performance in every aspect of indirect tax management, including calculation, data management, and data analytics/quality control. The company tapped Vertex’s end-to-end tax solution for managing Suministro Inmediato de Información (SII) Spanish government legislation that requires (nearly) real-time VAT compliance via the electronic submission of transactional invoice data for both sales and purchases.

Duracell is using advanced tax technology to set a new industry standard in VAT management and value creation. In doing so, Duracell is tackling traditional VAT challenges—such as calculation, data management, and more recent and challenging obligations, including Spain SII and Poland VAT SAF-T, among others.

By implementing Vertex, Duracell is achieving a higher level of compliance, allowing to reduce the amount of time teams spend on low-value manual activities and potentially saving the fees for third-party VAT compliance related services. And, it is providing a powerful example for other global companies seeking a more effective and comprehensive solution for managing VAT.

In Their Words

“Our goal was to increase the efficiency and overall quality of the Duracell end-to-end VAT process through automation and meeting new near real-time filing requirements. In essence, we are able to achieve this and transmit data to the tax authorities for multiple jurisdictions efficiently, in required formats, with one solution, on one platform. This included partnering with Vertex in order to transmit the first Spanish SII electronic VAT filing four days after the new legislation came into effect.” — Irmante Stazyte, Global VAT and International Tax Manager

Espresso Services

A double shot of confidence—simplifying and automating tax management

Winner for use of Vertex Cloud Indirect Tax

Established in 1989, Espresso Services Incorporated is a full-service importer and distributor of commercial espresso coffee equipment and related parts and repair services. The business operates in various vertical markets both regionally and nationally as a master distributor, as well as a manufacturer’s representative. Its focus: to serve the general foodservice industry with high-quality equipment and aftermarket support.

Innovation at Work

A custom, hands-on approach makes sense for baristas—not back-office professionals. Espresso Services was facing a diverse base of retail, dealer, and distributor customers, and the company was unable to accurately calculate tax by using the native tax tables in its ERP. Consequently, the process was requiring manual intervention done not by tax professionals, but by customer service and accounting staff. The company sought a solution that accurately calculated tax based on customer, item, and jurisdiction variables—all while taking into account sales tax exemptions and special taxability in certain jurisdictions. The team also wanted help simplifying the preparation of sales tax returns.

Espresso Services really wanted a tax engine that connected to its ERP, similar to that used by multinational enterprises, but flexible to its budget. The company found what it needed in Vertex with its cloud-based tax calculation and returns solution, now Vertex Cloud Indirect Tax. The solution enabled Espresso Services to assign its items to product classes that can then be exempted at the customer level. For example, Espresso Services can now exempt retail customers from sales tax on food ingredients they are reselling to customers, but charge them tax on equipment being used in their business. Similarly, the company can now exempt a dealer from sales tax on equipment being resold to its customers, yet tax them on food ingredients being consumed within the business.

With Vertex Cloud, Espresso Services has been closing the month and setting up items and customers more quickly. The team no longer has to modify the taxability of certain items on sales orders—resulting in far fewer customers calling with sales tax questions and virtually eliminating the need to process sales tax credits. The solution was simple enough for non-tax staff to manage their tax needs without needing IT involvement or having to perform maintenance or hosting.

In Their Words

“We are a strong believer in Vertex Cloud based on its functionality, flexibility, cost, and customer support and selected the technology due to our growing company and diverse business and customer-base. The scalability and centralized database enabled us to save an entire resource and reduce our audit exposure. We can now calculate the proper tax rates, while improving efficiency and accessing the most current rates and rules across thousands of jurisdictions." — Ryan Briggs, CFO

L.L.Bean

Business transformation and better bottom line impact, while improving customer experience

Winner for use of Vertex Indirect Tax O Series and Vertex Indirect Tax Returns

L.L.Bean has been providing active gear, apparel, and expert advice to help customers enjoy the outdoors for over 100 years. Founded in 1912 by Leon Leonwood Bean, the company began as a one-man operation. Guided by L.L.’s belief in keeping customers satisfied, the company has grown to a global organization with annual sales of $1.6 billion. Company headquarters are in Freeport, Maine, just down the road from its original store.

Innovation at Work

L.L.Bean was in the midst of a major, multi-year business transformation. Among the key goals: enabling more efficient and standardized work processes across the company while significantly reducing the number of applications its internal IT group must maintain. As part of the transformation, the company migrated a complex network of legacy tax systems to Vertex O Series as its single tax solution.

L.L.Bean is already seeing direct benefits from its investment in Vertex. Customer experience is better thanks to stronger integration across source systems and more consistent tax results. IT no longer needs to maintain a patchwork of legacy systems. Managing monthly compliance has not only enhanced accuracy but eliminated time-consuming manual work giving the tax team more capacity for higher-value activities. Today, the tax team has greater agility in responding to ongoing tax rule changes in every channel of their business.

Ultimately, Vertex O Series has enabled the tax team to lay the groundwork for better tax audit results which is expected to contribute significantly to the company’s bottom line, reduce IT support needs by 35-50%, reduce monthly compliance efforts by 25%, and reduce the number of tax-exempt orders on hold for review.

In Their Words

“Vertex enabled L.L.Bean to point all calling systems to a single tax engine—providing ‘one version of the truth.’ This simultaneously improves customer service and reduces financial risk.” — Jeanne Sanders, Director of Tax

Microsoft

Enabling digital services on a global scale

Winner for use of Vertex Indirect Tax O Series

Founded in 1975, Microsoft is the worldwide leader in software, services, devices, and solutions that help people and businesses realize their full potential. Headquartered in Luxembourg, Skype is a division of Microsoft, which sells telecommunications services on behalf of Skype within the United States and Canada.

Innovation at Work

Communicating via Skype might be clear and easy, but managing telecom tax complexity is anything but. Microsoft Corporation was facing a host of tax challenges. Among them: unbundling telecom services and capturing the detailed transaction results, making taxability determinations and rating/calculating taxes, fees, and surcharges by applying a different telecom or non-telecom tax category to each unbundled component, linking taxes across components, and rating single-month, multi-month, and multi-year billings upfront using both the simultaneous exclusive and tax-inclusive prepaid services across the different bundled offerings.

To take control of that complexity, Microsoft needed a scalable, flexible, and function-rich telecommunications solution that could support all important sales channels—small-to-midsize business, government, education, large volume licensing, and reseller and distributor channels. The goal was to build a telecom solution within the standard tax software package. Implementing two different tax software solutions was not an option. Nor was the business willing to modify how it sold non-telecom services.

Microsoft selected Vertex O Series for the job. It now has an in-house solution for telecommunications tax that functions across all billing systems and permits all existing business channels to leverage the same solution—regardless of differences in customer details or data quality. Standard sales and use tax, GST, VAT, environmental fees, and other taxes are now calculated or exempted in the same system and at the same time as telecom is unbundled and rated. The company has experienced significantly improved tax reporting and tax forecasting.

In addition Microsoft implemented Vertex O series 7.0, a global Vertex implementation for Microsoft Ecommerce Platform UST (Universal Stores). This was to accomplish real-time Vertex tax engine calculation at a Global level (240 countries) and was done in a very compressed timeframe. The Goal: Vertex as single tax engine for all Microsoft ecommerce sales transactions across the globe.

In Their Words

“When we began four years ago, the vision was to calculate or rate all transaction taxes, surcharges, and regulatory fees and maintain all exemptions on a single platform. Vertex enabled this vision by delivering their North American telecom content for Vertex O Series and has continued to support us in our global rollout for ecommerce sales across 240 countries. Given the scale of our organization, this single platform has been able to integrate with and support numerous billing systems for diverse purposes. We could not be any happier with Vertex O Series and its functionality.” — James Williams, JD/LL.M/Patent Bar, Senior Tax Manager – Microsoft Tax Process & Technology (TPT)

Northern Tool + Equipment

Tax tools for expanding into new markets and mitigating the risks of business expansion

Winner for use of Vertex Indirect Tax O Series

Since 1981, family-owned Northern Tool + Equipment has grown into the ultimate destination for hard-working do-it-yourselfers and professionals. The company’s selection of generators, pressure washers, power and hand tools, air compressors, welders, material handling equipment and more includes top national brands and its own world-class products, which it engineers and builds in its own manufacturing facilities. Northern Tool + Equipment offers useful products at a great price and backs them with product expertise and customer care.

Innovation at Work

Many states and jurisdictions require a POS system to display tax fees and surcharges on the customer receipt separate from the core sales tax calculations display. Vertex O Series combined with the Retail Extract toolset and a post-Tax Assist rule within the Vertex UI that interacts with a Vertex Lookup Table dynamically integrates with the POS system. This ensures that every receipt generated by the system is compliant with statutory requirements, and has effectively articulated the differences between true sales tax items, and add-on fees or surcharges. This happens automatically with minimal maintenance and maximum compliance with state rulings governing receipt display.

How receipts are displayed to customers that are generated by the POS system is fully controlled by Vertex O Series, requiring zero custom IT development work within the POS platform. This represents a major achievement in managing complex receipt compliance rules and means every receipt is compliant and that Northern Tool can confidently expand into new product lines and new jurisdictions.

In Their Words

“With this unique utilization of Vertex O Series, we eliminated the need for manual coding in the POS system for all of the state and jurisdiction-specific scenarios. This positively impacted our business, enabling us to grow our product selection and expand into new markets.” — Jason Davenport, Sales Tax Manager

North Star Award Winner Starbucks Coffee Company

Blending data and innovation to transform indirect tax management

North Star Award Winner for use of Vertex Tax Performance Engine

Since 1971, Starbucks Coffee Company has been committed to ethically sourcing and roasting high-quality arabica coffee. Today, with more than 25,000 stores around the globe, Starbucks is the premier roaster and retailer of specialty coffee in the world. Through its unwavering commitment to excellence and guiding principles, the company brings the unique Starbucks Experience to life for every customer through every cup.

Innovation at Work

Starbucks recognized an opportunity to further advance the effectiveness of its tax team. How? By transforming the way it manages indirect tax data across multiple business channels, legal entities, business systems, and tax jurisdictions. By adopting the Vertex Tax Performance Engine, this global innovator is serving as a true “North Star” for other enterprises.

Starbucks is leading the way by implementing a single, tax-focused solution for managing data, performing calculations, and improving controls—with the flexibility to accommodate business and tax changes in the future.

Starbucks has created a sustainable and uniform data repository to improve tax management, streamline audits, and reduce risk. They’ve streamlined tax data management across multiple business channels. The efforts have helped uncover underlying data issues, gaps, and errors that were less visible in the legacy, Excel-dependent processes. Now Starbucks is able to reallocate tax team resources to more strategic, higher-value activity. Collaboration on the improved reporting has enabled IT teams to better understand the full tax scope of data impacts when planning IT changes. And, the use of leading edge technology by the tax department is helping attract and retain talent.

In Their Words

“Reducing manual data management processes has enabled the tax team to focus on improvements to the upstream foundational data and transactions which is driving improved accuracy. And as our team grows in experience with the functionality of the Vertex Tax Performance Engine, we’re already identifying additional opportunities to streamline processes and increase value.” — Ryan Meas, Sr. Manager, Indirect Taxes

North Star Award Winner Weatherford

Drilling into a simplification of business assets

North Star Award Winner for use of Vertex Indirect Tax O Series

Weatherford is one of the largest multinational oilfield service companies providing innovative solutions, technology and services to the oil and gas industry. The Company operates in over 90 countries and has a network of approximately 860 locations, including manufacturing, service, research and development, and training facilities and employs approximately 29,500 people.

Innovation at Work

For Weatherford, calculating use tax on fixed assets is a complex process. Will the asset be placed in service? Will it be rented out? Where will it be used? Is the job taxable or nontaxable? Tackling those questions is key to calculating and collecting use tax—yet answers typically are unknown at time of purchase.

Leveraging Vertex Indirect Tax O Series, Weatherford built a fixed-asset use tax solution that applies real-time use tax rates and rules in terms of business processes for upstream tax transaction management. The team created a Vertex O Series call for rates/use tax calculation outside the usual Procure-to-Pay, Order-to-Cash business process. As a result, the tax team was able to evaluate an asset’s use tax position as soon as an asset utilization business decision triggered a use tax liability, initiating the process—and posting use tax to the general ledger if appropriate—on demand, mitigating potential exposure.

The solution will bring estimated audit savings in the millions, including interest and penalties. The tax team will slash its future audit workload and Weatherford’s cash flow will benefit in terms of avoided interest and penalties. Delivering lower risk and tangible business results, Weatherford’s approach to use tax can serve as a “North Star” to other enterprises seeking to address growing scrutiny across multiple jurisdictions.

In Their Words

“Despite difficult economic conditions in the oil and gas industry, the Weatherford IT-tax team, along with its in-house developers, designed and implemented a solution that allowed the company to properly accrue use tax on assets that could be categorized as “mixed or divergent” use in nature. Weatherford leveraged Vertex O Series to build its fixed asset use tax solution in order to utilize real time use tax rates/rules to properly evaluate if tax was due on the movement of assets, closing potential gaps and saving on audit penalties." — Juan Betancourt, Manager IT – Tax