March 30, 2011 | Debbi A. Ballard | Comments 0
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Avon Japan Sale Came Just Before the Disaster

copyright, 2011, Debbi A. Ballard All rights reserved worldwide.

It’s interesting to note that the Avon Japan sale came just before the disaster there caused by the tsunami and nuclear crisis. Make sure to watch the video news report accompanying this article. Avon Products, Inc., just a few months ago, sold its 74.67% interest in Avon Japan to an affiliate of TPG Capital, a private investment firm. This was announced in a press release by Avon Products, Inc. on November 8, 2010. TPG’s investment is 7.3 billion yen (cash) which is about $90 million (U.S.).

The reason Avon decided to sell was that management wanted to focus on markets that had higher growth potential. The press release stated that Avon did not want to make the significant investment needed to “generate profitable growth in the near to intermediate term.”

Hopefully the direct sellers of Avon Japan will find that the new management team supports them and does its best to facilitate their success. These transitions are always risky but we hope for the best so that the direct sellers can realize their dreams. It is just such a shame that along with the transition, now they have to deal with the horrible disaster as well.

Avon, the largest direct selling firm in the world, has over $10 billion in annual revenue. It operates in over 100 countries and has over 6 million independent reps. When the leader in our industry sells its interest in Japan, every company sits up and takes notice. Japan is the second largest market in the industry with an estimated $22.4 billion in retail sales in 2006 according to the Direct Selling Association.

Sometimes it is incredible how much timing, in and of itself, can impact a company’s current and future potential.

Both TPG Capital and Avon are reflecting on that right now as are all companies impacted by the disaster. The fact that the Avon Japan sale came just before the disaster is amazing in its timing. It’s also a significant reminder to all direct selling companies and their reps to never ignore worst case scenario contingency planning.

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About the Author: MLM Consultant, Expert Witness, Author, Blogger, Speaker and CEO of International Network Liaison Corporation...but more importantly, wife, mother, daughter, aunt, cousin and friend.

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