Avon set to maintain spectacular growth

The cosmetics firm xpects to maintain the double-digit annual growth it recorded in the past four years

AVON Cosmetics (M) Sdn Bhd (Avon Malaysia), which posted RM327.4 million revenue last year, is gearing up for another spectacular growth this year.

Avon Malaysia, Thailand, Vietnam and Indonesia president Mansoor Wan Abdullah said the company expects to maintain the double-digit annual growth it recorded in the past four years.

"We grew at an average of 15 per cent annually since 2004. In 2003, our revenue was RM149.2 million and the revenue has doubled to RM327.4 million in 2007," he said in an interview with Business Times in Petaling Jaya.

Mansoor said Avon Malaysia has come out with a strategy to put the company on sustainable and profitable growth for this year and the years ahead.

One of the strategies is the Avon Sales Leadership Framework (ASLF), which will convert existing Avon single-level selling system to a four-level system.

This will, according to Mansoor, ensure greater penetration of Avon products to Malaysian consumers as well as higher earnings for Avon dealers.

He said the pilot study of ASLF in Sabah and Sarawak between 2005 and 2006 showed favourable results.

"During the period, Avon in the peninsula grew 14 per cent but the growth in Sabah and Sarawak was 23 per cent," he said.

Avon Malaysia will officially launch ASLF on April 1 this year, he added.

Another strategy is to push for greater sales of Avon skincare products.

Mansoor said in terms of product brand among direct selling companies in Malaysia, Avon's make-up, fragrance and jewellery are ranked first in the market. Its range of lingerie is ranked second, while its skincare products is currently at fifth place.

Avon Malaysia's target is to drive its skincare products to grow double the industry growth, its beauty products to grow three per cent above the industry growth, while at the same time maintaining market leadership for its cosmetics and fragrances.

"We have also implemented One Team One Dream, where dealers and franchisees share the same vision and provide better services to customers," he said, adding that Avon Malaysia will conduct training and development for its dealers and franchisees under the programme.

Avon Malaysia appoints franchisees to operate Avon boutiques, called "Avon Puteri", that supply Avon products to dealers.

There are about 380,000 Avon dealers and 176 Avon boutiques nationwide.

Mansoor attributed Avon Malaysia's strong double-digit growth to improvement in training of selling and beauty skills, provision of credit to top dealers, stock consignment to Avon boutique operators, and better discounts, and commissions to Avon dealers.

The company is also unfazed by competition as Avon Malaysia's strength lies in teamwork, good product range, aggressive training and good selling model, he added.

Avon Malaysia's competitors include direct-selling companies and cosmetic companies.

Avon Malaysia is part of New York-based Avon, the world's leading direct seller of beauty products, with US$8 billion in annual (RM25.8 billion) revenue.

Its product lines, which include Anew, Avon Colour, Skin-So-Soft, Simply Pretty, Avon Intimates and Avon Jewelry, are marketed to women in over 100 countries through five million independent sales representatives.