Nu Skin chooses Avalara to manage cross-border VAT

Nu Skin Enterprises is a USD$ 2 billion plus direct selling company that markets premium quality personal care, nutrition, and technology products through a global network of independent distributors. Headquartered in Provo, Utah, the company now operates around the world in nearly 50 countries. As a direct selling company, Nu Skin utilises person-to-person marketing to promote and sell their products.

With VAT applying in over 30 different territories to which they ship, keeping track of the different VAT regimes’ and reporting requirements is a major task, and one that Jos Verheijen, Indirect Tax Manager at NSE Products Europe, admits can be a full-time role. “Keeping up to date with the continual changes in the rules and how they need to be applied and report them in each territory is a challenge,” he continues. “That is why we decided to implement external software that can work with our SAP platform to make sure we always get it right.”

“Our challenge is now around working with our people in different countries to make sure they understand how to get the best out of the system... It’s a big job, but the returns more than justify the investment”.

The first and most obvious approach was to do a system-wide upgrade of the SAP platform to incorporate VAT management. However, as Jos points out, this was not as simple as it might appear. “We have affiliates in many countries in which we trade and each of these has its own instance of SAP. This means each instance would have had to be tailored to manage the local VAT rules. Trying to collate that in a number of different languages to ensure a seamless solution would have been a major task, and probably impossible without a dedicated team.”

Instead Nu Skin looked at different solutions and explored the market to find an external provider that could cover all their markets. “I knew of Avalara from my previous work, so I invited them to bid for the role amongst other providers. One of their most appealing benefits was that they cover all the countries where VAT is either in place or being rolled out, so we don’t have to worry about localising the outputs for different formats, rules and filing regimes. It was the perfect answer all rolled up into one effective box.”

“VAT Reporting runs like a Swiss watch. It does exactly what it says on the tin and does it very efficiently.”