New study finds a composite Avalara customer realized $1.2 million in benefits and $881,000 in net present value over three years, with payback in under six months
SYDNEY, Sept. 9, 2026 /PRNewswire/ — Avalara, Inc., the agentic AI leader in global tax and compliance, today announced the results of a new commissioned study conducted by Forrester Consulting: The Total Economic Impact™ (TEI) Of Avalara. The study found that a composite organization representative of Avalara customers achieved a 322% return on investment over three years, with an investment payback period of less than six months.
“We believe a 322% ROI and payback in under six months demonstrate that compliance automation is a substantial financial advantage,” said Jayme Fishman, Chief Strategy and Product Officer at Avalara. “By combining trusted tax content with automation and AI directly in the systems businesses already use, we help customers improve accuracy, operate with greater confidence, and make tax and compliance more reliable as their businesses grow.”
To examine the potential return on investment that organizations may realize by deploying Avalara products and services, Forrester Consulting interviewed seven decision-makers across industries with direct experience using Avalara. Forrester aggregated their experiences into a single composite business with 2,000 employees and $300 million in annual revenue.
Why the Study Matters for Tax and Finance Teams
Regulatory requirements continue to expand and grow more complex, making manual, spreadsheet-based tax compliance increasingly difficult to sustain. Before adopting Avalara, interviewees described relying on manual processes and legacy systems to calculate and manage sales and use tax, file returns and 1099 and W-9 forms, maintain rates, and apply exemptions. These approaches were time-consuming and led to inaccurate calculations, inconsistent exemption handling, and material compliance risk, including audit findings, penalties, and back taxes.
After investing in Avalara, interviewees’ organizations automated tax calculation, filing, and exemption management through a centralized system integrated with their ERP platforms. As a result, they improved accuracy and compliance while reducing manual effort and spending on third-party services.
Key Financial Findings
A three-year financial analysis of the composite organization demonstrated:
- 322% return on investment (ROI) over three years.
- $881,000 in net present value (NPV) over three years.
- $1.2 million in total benefits versus $274,000 in total costs over three years.
- Payback in less than six months.
Quantified Product-Level Value and Savings
Forrester quantified the following three-year, risk-adjusted present-value benefits for the composite organization:
- $317,000 saved by avoiding third-party services and additional full-time employees, allowing the organization to absorb growth in jurisdictions and compliance requirements without proportionally increasing headcount or consulting costs.
- $267,000 saved on use tax by automating taxable-purchase identification and use tax calculation and accrual, reducing up to 45 hours of manual review per month.
- $203,000 in labor savings from Avalara Exemption Certificate Management (ECM), which reduced certificates filed with errors by 95% through centralized, AI-assisted capture and validation.
- $96,000 saved by managing 1099 and W-9 preparation, validation, and submission within Avalara, reducing reliance on third-party filing providers.
- $93,000 in labor savings from Avalara Managed Returns, which eliminated 570 hours of work and reduced time spent on return filing by approximately 95%.
- $53,000 saved from Avalara VAT Reporting, which drove a 90% improvement in VAT compliance efficiency across multiple jurisdictions.
- $52,000 saved through improved audit preparation and avoided penalties, including a 90% efficiency gain in audit prep and roughly 36 hours saved per audit.
- $38,000 saved through participation in the Streamlined Sales Tax (SST) program using Avalara.
- $35,000 in labor savings from Avalara Tax Research, a 90% efficiency improvement that saved about 18 hours per month.
In addition to quantified savings, interviewed decision-makers highlighted significant unquantified benefits, including increased executive peace of mind, operational resilience, and seamless scalability without organizational strain.
Register to join Avalara and Forrester on October 7 to learn how organizations are realizing a 322% ROI with Avalara. This webinar will explore the findings from the Total Economic Impact™ study and the measurable business benefits of modernizing tax compliance.
About Avalara
Avalara is the agentic AI platform for global tax and compliance. For more than two decades, Avalara has built one of the most expansive libraries of tax content and integrations in the industry, processing more than 54 billion transactions annually and supporting millions of businesses worldwide. The company’s purpose-built AI agents automate end-to-end compliance with greater precision, from tax calculations and return filings to exemption certificate management and beyond. For more information, visit Avalara.com.
This study was commissioned by Avalara and conducted by Forrester Consulting. Results are based on the aggregated experiences of interviewed customers and a composite organization. Forrester makes no assumptions as to the potential ROI that other organizations will receive.
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SOURCE Avalara, Inc.
