Streamlining tax and payments for global success

The global subscription economy continues to grow at an incredible pace — According to The Subscription Economy Index report the subscription economy has grown by a remarkable 435 percent over the last decade, and an IDC study predicts that subscriptions will represent a staggering 92% of total software revenue by 2027.

Regardless of what your business sells, however, if you utilize a subscription model, getting your payment process right is vital both for your customers and for you.

Zuora, a leading provider of strategies and solutions for subscription billing, recently hosted a panel on the importance of streamlining payments at its Subscribed Live London 2024 event. The conversation included leaders from Zuora, Avalara, and Melio — a joint customer of both companies — who discussed benefits such as lower costs, reduced friction, and enhanced customer relationships.

One key topic was how Avalara’s expanded partnership with Zuora, particularly the integration of Avalara E-Invoicing and Live Reporting into Zuora’s monetization platform, can help businesses manage compliance challenges. Below are a few insights from the discussion.

The subscription model allows businesses to expand very quickly to new markets, including international ones. That means tax obligations can expand quickly as well, with each new market bringing additional complexity, commented James Bright, Avalara Strategic Alliance Manager for EMEA. And the challenge isn’t limited to U.S. companies selling globally; it also applies to international companies selling into the U.S.

In order to have a streamlined payments process, taxes have to be taken care of upstream, Bright said. Is the tax determination accurate at the time of payment? Is it clearly presented to the customer? Do you need to provide education to the customer on what taxes they’re paying and why? If they’re correct and presented in the right way, even taxes can contribute to a positive customer experience, he added.

Bright emphasized that the key is getting ahead of it and having a strategy (and a solution) in place that can grow with your business. Are your systems flexible enough to move in step with your business when you make changes? Even better, do your systems make it easier for your business to adapt and change?

Flexibility is also vital when it comes to payment methods — particularly for companies looking to scale internationally — because practices can vary widely by country or region. For instance, 40% of B2B payments in the U.S. are still made via paper check, according to Melio Director of Product Strategy Yonathan Grigiac. Melio’s solutions enable small businesses to navigate new channels and markets more easily, adding payment (and payment acceptance) options that maintain or improve cash flow while providing a solid customer experience.

Melio’s partnership with Avalara allows the company and its clients to ensure the correct sales tax is presented to customers and the right amount is collected, Grigiac said — even as new markets create new challenges on the compliance front.

Every country has different rates and rules for different products and services. Avalara’s automated compliance solutions — seamlessly integrated within the Zuora platform many businesses already use for their subscription sales and management — enable companies to meet diverse tax challenges including e-invoicing mandates and live reporting requirements.

The Zuora integration covers mandates in 60 countries already, Bright said, saving businesses a lot of time and effort. Core capabilities and benefits include:

• Global e-invoicing setup. Zuora customers can establish global e-invoicing capabilities by configuring Avalara’s services according to their specific reporting needs, facilitating seamless international operations.
• Access to e-invoice networks. The Avalara-Zuora partnership provides connectivity to national and international e-invoice exchange networks and government platforms, broadening the reach and efficiency of electronic invoicing processes.
• Support for regional e-invoicing. Businesses can utilize Avalara’s global API to comply with country-specific e-invoicing models, including requirements such as digital signatures, QR codes, digital archiving, and tax authority clearances.
• Real-time invoice monitoring. The integrated solution offers a unified reporting console for real-time visibility into the status of e-invoices, enabling businesses to track the lifecycle and address any issues promptly.
• Secure archiving solutions. Companies can archive e-invoices in compliance with data localization, security, and retention policies, ensuring that all electronic documents meet legal and regulatory standards.

Together, Avalara and Zuora deliver a powerful, integrated solution tailored for businesses facing the challenges of modern billing and global tax obligations. Over the past 15-plus years, the two companies have helped more than 300 shared customers streamline revenue operations from pricing to payment. As a recognition for this partnership, Zuora awarded Avalara the 2024 Client Experience Partner of the Year.

With Avalara and Zuora, you are equipped to thrive in today’s fast-paced, compliance-driven market landscape. Right in the platform you’re already using, you have access to powerful solutions that simplify tax compliance for subscription billing, streamline multi-region management, support global growth, and enhance reporting accuracy.

It’s the perfect marriage of technology and strategy, creating operational efficiencies, enhancing the customer experience, even improving cash flow. But perhaps most important, it frees up valuable time and delivers vital data so your people can analyze, forecast, and drive profitable growth for your business.

Click here to learn more about how Avalara and Zuora work together seamlessly to support businesses.

Want to arrange a demo and see how we can help your business? Contact our team.