Avon Case
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Avon is much more dependent on its foreign operations because most of its sales in outside of the US. There is virtually no remaining untapped market for cosmetics, fragrances and toiletries.
3. In transitional economies, Avons market entry coincided with pent up demand from the period of centrally planned economic policies. In rapid growth economies, such as Chile and Malaysia, Avon taps a growing middle- class market the can afford its products.
4. If there a global recession like the one Avon experienced in 2008 happened. Women was entering the workforce fulltime and made them less receptive to door to door salespersons and less willing to spend time on makeup demonstrations and the arrangements for the later receipt of the purchases. With women working fulltime, the pool of women seeking part-time employment will dry up.
5. The major competitive advantages of Avon is that they sell their products directly to households and individuals, retail outlets and off the sales reps own websites.
6.Cons
-Avon is not reaching every customer by not selling its products in retail establishments.
-Direct sells help company maintain a smaller number of employees.
-Keep advertising budget low
– Avoid paying for shelf space in stores (reps do much of the promoting)
7. If Avon has to select new suppliers should consider the following before making a decision on where to manufacture their products.
– The companys financial strength
– Its good connections
– Extent of its other business commitments
– Current status of its personnel, facilities and equipment
– Its reliability as an honest performer
– Its image in relation to the product or service being sold
8. Avon faces challenges in product proliferation. Decentralization to fit the wants of local consumers has undoubtedly given consumers the products they want. It has come with increased manufacturing costs, which threatens Avons strategy of maintaining a good profit margin while simultaneously offering customers a good value for their money.
There are several other challenges Avon faces in the future. Although its direct sales method has been important in Avons success, there are drawbacks to it. Customers cannot obtain a product whenever they want it. Customers cant always discern exact colors from catalogs, it may be difficult for Avon to capture clientele in a higher- price category