SWOT Analysis and Recommendation of AVON Company
Avon Company is the leading global manufacturer of beauty products and home products improvements around the globe. The company has been operating its worldwide business through direct-selling system. Its headquarters is based in New York City; which has approximately 42, 000 employees worldwide. In this connection, Avon Company has massive operations in North America, Latin America Europe and Asia Pacific regions. It has 63 subsidiaries in different countries outside the US market. More than that, the company is almost present in 51 other countries through distributorships. It consists of 5.3 million representatives, and about 446,000 of them come from US territories. During 1990, the company became the first leading cosmetics company that permanently bans animal testing of its product line. And, it also made its mark in Russia, China and other countries in Central Europe with its excellent beauty products. The company has recorded total revenue of US $ 10,862.8 million last fiscal year of 2010. There was a significant increase of 6.4 % in its revenue compared to 2009 total income. Additionally, the operating profit of the company in 2010 fiscal year was around US $ 1,073.1million. Relatively, there was 6.7 % increase over its operating profit in 2009. But, Avon Company had acquired a net profit of US $ 606.3; it was reduced up to 3.1 % from its net profit in 2009 fiscal year. The significant increase in company’s revenue is attributed to the fact that it has growing teams of active representatives who promote the products massively in the international market. Similarly, there is also a remarkable increase of 15 % in beauty products sales; as well as the foreign exchange standing has contributed a lot to the company’s revenue growth.
Furthermore, Avon Company has been able to deliver a detailed strategic analysis of the entire organization. It enables to determine its performance level in the market and in the global economy as well. Subsequently, the market share data of the organization provides a deep financial view of the company. It conducts regular in-depth qualitative and quantitative analysis in order to analyze and understand which is effective and efficient marketing strategy needed by each product brand. This marketing approach really helps the company to acquire more customers and numerous possible prospects of its product lines. The company has been able to share its beauty products by region and sector all through out the globe. Its strong and attractive brand portfolio paves the way to attract tremendous number of clients all over the world to try and use its beauty products. In the same manner, these people also have great opportunities to earn remarkable income by sharing or testifying the effectiveness of the products to other people. As a result, they are able to sell also the same products that they are using to their friends and relatives with all ease. Aside from that, the products have been proven effective and best beauty enhancer to many Avon products users. Moreover, there are new and innovative product developments made by Avon experts and specialists, which enables to help to spread its marketing and distribution strategies into the world market. Surprisingly, Avon Company maintains its various delivery controls in direct selling and marketing, beauty centers, beauty boutiques, retail outlets and online portals. The excellent company’s sales promotion and sales development strategies are being directed and assisted by leading representatives by distributing sales kits, brochures, product samples and product demonstrations. The product lines of the company not only focused on the beauty products. As a mater of fact, it goes beyond beauty. While beauty division is busy in engaging in the manufacturing and distributing of beauty products like cosmetics, fragrances, skin care and toiletries; the beauty plus division, on the other hand, is also doing its best effort to manufacture and distribute non-beauty product line such as jewelries, watches, apparels and accessories. In the same way, beyond beauty Avon Division is also involved in the manufacturing and distribution of home improvement products and gift items, as well as decorative items.
Correspondingly, Avon Company relies on its own manufacturing plants for its beauty product line, as well as on the different third party manufacturers for its non-beauty products; which makes Avon a company of beauty plus and beyond beauty organization. Its raw materials and supplies are made of essential oils, chemicals containers designed by own Avon’s artists and designers; and packaging components from company’s various suppliers. For past years, Avon has been able to expand and venture to other various product lines for women such as Mark and Avon Platinum Visa Card, in partnership with Bank One. In 2004, the company also purchased 20 % of the shares in its two subsidiaries in China market. And, from then on, Avon-China has become the in-demand market not only for women but also for men’s cosmetics.