Avon Products Inc. reduces your staff around the world by 10% as part of its ongoing effort to restructure. This reduction is the second step after the company reduced the number of its workforce by 8% in 2018.
According to representatives, a reduction of almost 2,300 jobs will allow Avon to save about 97 million dollars by the end of the year.
Cosmetic company engaged in direct sales, also announced that it is taking steps to reduce the diversity of their product lines and reduce inventory levels of products by 15% and reduce units by 25%. Therefore, Avon will immediately reduce the costs of obsolescence reserves totaling about 88 million US dollars.
“Our strategy to “Open Up the Avon” is to provide a more simple and economical operation, our infrastructure and thinking must reflect the reality of the Avon. All the initiatives announced today contribute to the achievement of these goals. This reboot gives us the opportunity to improve our portfolio and focus on products that are important and relevant to our client. I would like to Express my sincere gratitude to the talented employees affected by this restructuring, and we will do our best to see everyone treated fairly and with respect,” said Yang Zijerveld, CEO of Avon, in his address to the press.
In addition, the company noted: “Such decisions are always difficult. However, we must take necessary actions to improve our operations and strengthen our ability to continue to invest in initiatives to transform and stimulate future growth.”
Avon struggled for a stable development for many years. First she announced her long-term strategy “to Open Up Avon”, which would allow it to return to sales growth in September. One of the priority direction of further development included plans to restart sales model and develop the digital capabilities of the company. The company strives to adapt your business to the era of e-Commerce, training their sales representatives work with digital resources.
The market capitalization of Avon fell to 823 million dollars with the maximum score, which stood at nearly $ 22 billion in 2004. It is worth noting that the company’s shares rose 4% after announcing job cuts.