Case Study
Kelly-Moore Paint Company
Sovos simplified sales and use tax management for Kelly-Moore Paint Company’s POS system and reduced the company’s risk of audit.
Kelly-Moore Paint reduces audit risk with Sovos
Summary
Business Challenges
- Variations in tax regulations from different jurisdictions and products created a complex compliance process for Kelly-Moore.
- The company relied on its sales clerks to appropriately determine sales tax rates, which many were not qualified to do
Solution
- Kelly-Moore needed a complete, end-to-end compliance solution that could master its intricate compliance needs.
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The company wanted a platform that could easily integrate with its ERP system and automate many of its processes.
Benefits
- Sovos simplified Kelly-Moore’s compliance efforts and took the pressure off its sales clerks.
- Kelly-Moore can now confidently apply the correct tax rates to each product it sells and in each jurisdiction in which it operates.
The Company
Kelly-Moore Paint Company is the largest employee-owned paint company in the U.S. with 2,000 employees, nearly 200 retail stores, and three manufacturing facilities across nine different states. The company deals with a large number of tax jurisdictions as well as a complex set of applicable regulations and nuances.
The Challenge
Many of Kelly-Moore’s products are taxed differently — even within the same order. It all depends on the tax jurisdictions involved, and whether the purchaser is an end-user or a contractor who will, in effect, be reselling the paint.
The company’s retail customers are responsible for taxes on transactions made in applicable jurisdictions, but this was further complicated by the company relying on sales clerks to make that determination as well as the sales tax rates.
The Solution
Due to the multiple taxing jurisdictions that Kelly-Moore deals with, choosing an end-to-end tax determination solution partner was imperative to achieve continual growth.
“We now have a much greater certainty of tax compliance. We have reduced the chance that we will be selected for a tax audit, reduced the cost of complying with tax audits, and greatly reduced the potential that we will be subject to penalties.”
Carl Sweetland
Chief Information Officer, Kelly-Moore Paints
The Results
Kelly-Moore can now be certain it charges the correct amount of tax on each transaction throughout its retail operation. In addition, the company has removed the burden of identifying tax rates from its sales clerks, who often could not keep up with the complex nature of varying rules and rates for different products and within different jurisdictions.
Kelly-Moore can now accurately identify appropriate rates and collect tax accurately. This has allowed the company to avoid audits and reduce the risk of incurring penalties, giving everyone involved peace of mind.
Why Sovos?
Kelly-Moore chose the Sovos Sales & Use Tax solution to fulfill its needs because the Sovos tax research team had demonstrable success in providing correct tax rates in each jurisdiction in which the company operates. In addition, the Sovos platform integrates with Kelly-Moore’s ERP system fluidly and automatically generates returns for each of Kelly-Moore’s divisions.