News and Reports

Gails Avon: Article in the Sunday Times - October 9th 2005
Avon ladies ring the right bells
Roger Eglin looks at why the 120-year-old cosmetics company is still going strong as high-street retailers face a struggle

GAIL REYNOLDS was a part-time accountant working in Hastings. Then she thought she would try a change. She gave up accountancy and now, as a self-employed Avon lady, she looks after 1,000 customers in Bexhill, Hastings and St Leonard's.
One measure of how successful she has become is that her husband has given up his job as a manager to become an Avon representative. Reynolds thinks the products are fantastic and the company's approach impressive.

The flexible, self-employed way of working suits her lifestyle as a mother and she has nothing but praise for Avon's commitment to training and development. "The company tries to encourage us 100%," she said.
With promotions using the former EastEnders' star Tamzin Outhwaite, sales of cosmetics in the Avon Colour Brand range are blossoming. UK sales have reached £280m while globally they are £7.5 billion a year.
It is difficult to take in what a vast machine Avon is. It is the largest direct-selling company in the world, and last year it sold more lipstick, eye make-up, nail enamel, skin care items and bottles of fragrance than any other manufacturer. While high-street retailers like Boots are finding it tough, Avon goes from strength to strength.
In the past six months, 31% of women in Britain have bought an Avon product. The company has more than 8m customers and 160,000 representatives in the UK, more people than the army. Over a year 50m sales brochures go out to customers. After Radio Times, this is the magazine with the biggest circulation in Britain.
The company, which is registered on the New York Stock Exchange and is a member of the Fortune 500, is more than 100 years old. It operates in 140 countries and has been in Britain since l959. With the exception of the jewellery range and lingerie, Avon makes all its own products. Some of these come from factories in Poland, Russia and Germany.
Central to Avon's success is its ability to enthuse and motivate vast numbers of women. Every three weeks they collect a new Avon brochure, which runs to more than 170 pages, and go out to sell beauty products to customers - friends, colleagues, acquaintances or door-to-door.
At the basic level, earnings are reasonable. For every £100 of goods they sell, Avon ladies get 20%, which rises to 25% over £130. Earnings of between £30 and £50 every three weeks are common, with £75 to £150 not exceptional. Top performers make more, as much as £20,000 a year, particularly as they build up their business. Many have created a substantial enterprise. Reynolds had built up a 100-strong customer chain in Sussex before her manager asked if she wanted to start recruiting Avon representatives on commission.

Incentives are built into the system. "The better I train a representative, the more she can earn and the more I am going to earn," said Reynolds, who can recruit as many as 25 in a three-week period. What she finds particularly satisfying is the way she can organise her work to suit her needs, and those of her children.

Between 130,000 and 140,000 representatives are recruited every year by the 450 area sales managers. Typically an Avon lady is outgoing, enthusiastic and gets her training from the company, said Peter Nicholls, UK vice-president of sales.
"Out of the 160,000 people we have about 80,000 that have been with us for a long time. Others join and leave on a fairly regular basis." One lady is still active after 45 years, and others have placed an order every three weeks for 40 years.
A year ago, in a big initiative, Avon set up its sales-leadership programme. Sales leaders recruit, manage and motivate a team of Avon sales ladies, perhaps as many as 500.
Rebekah Testar, a housewife, began work with Avon two-and-a-half years ago and has become one of the top sales leaders in the country. She soon started earning more than the £15,000 she made in an office. She now has a team of 500, including 30 "down liners" as sales leaders are called.
Her husband has given up his job in financial services and joined the team as a sales leader, with seven people reporting to him. The couple share a customer base of 100.

The sales leadership programme has been running in America for 10 years and Nicholls said some of the top people make more than $500,000 (£284,000). He expects some of the British participants to be earning more than £100,000 in a year or two. "Sales leadership is a major initiative for us and the sky really is the limit," he said.
Before becoming an Avon lady, Linda Rumbold had been a hardworking international insurance broker. Today she runs a team of 90 customers in Ipswich, Suffolk, as well as managing 25 other Avon representatives. She has more time for her two children and works only 25 hours a week.

Recognition of people's effort and performance is seen as an important way of motivating them. Representatives who achieve the annual target of £6,500 within six months become members of the President's Club.
Avon UK president Jerry McDonald has spent part of the summer touring Britain, holding lunches for 2,500 of them. Another 17,000 who hit the annual target have attended a recognition dinner. "There's a lot of recognition and celebration of people's achievements," he said. "It's a very important element in Avon."
Market conditions have been less easy in recent years and Nicholls said that this year is proving a challenging one.
However, he is looking forward to Christmas. This is a key time, when 40% of Avon's business is done, and the build-up is already under way. Avon's annual growth rate runs at some 7% and Nicholls is confident that this year business will not be disappointing.