Makeup seller Avon to slash 1,500 jobs, exit 2 markets
Struggling Avon Products Inc., the door-to-door makeup seller, will trim about 1,500 jobs worldwide and leave South Korea and Vietnam altogether as a plan to turn around the company after years of turmoil.
The job is one of the first big moves by new chief executive Sheri McCoy, who replaced longtime CEO Andrea Jung in April. The cuts, which account for almost 4% of Avon’s workforce, will affect all functions and regions of the company.
The beauty firm has been going through a rough year in the highly competitive cosmetics industry. Its share price has gone in freefall. Jung rebuffed multiple takeover bids from Rimmel owner Coty Inc. And its third-quarter profit plunged 81%.
The job cuts are part of cost-cutting measures Avon announced in November to save $400 million by 2015. The New York-based firm said last month it would cut its dividend by nearly 75%.
“The decisions outlined today are necessary to stabilize the company and begin the process of returning Avon to sustainable growth,” McCoy said in a Tuesday statement.
Avon said its initial plans should be mostly implemented by the end of 2013. It also plans to concentrate on high-priority markets in order to rev up sales.
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