Intending to fuel growth Avon adjusts Latin American Management
What: Avon Products Inc. is splitting its Latin American operations between two executives: David Legher and Fernando Acosta.Legher, currently president of Avon’s Brazil business, will add responsibility for a South Market Group and Acosta, currently president of Avon’s Latin America segment, will retain responsibility for North Latin America.Chief Marketing Officer Patricia Perez-Ayala is leaving the company.
Why it matters: Latin America represents half of Avon's annual revenue. Avon's less than optimal financial performance has contributed to rumors of other cosmetic companies including Coty taking over Avon. Other options, that have not been executed, for Avon have included to exit the North America and Asian Pacific markets.
Avon Products Inc. is splitting its Latin American operations between two executives as the beauty products company continues its turnaround effort. In addition, Chief Marketing Officer Patricia Perez-Ayala will be leaving the company on Jan. 2 according to a company's statement.
Avon, a business model that relies on millions of women to sell its cosmetics directly to other women, also expects to record fourth-quarter charges of US$30 million to US$35 million related to additional cost-cutting moves under its broader US$400 million cost savings initiative. The latest cost-cutting moves aim to reduce annual pretax costs by about US$40 million.
David Legher, currently president of Avon’s Brazil business, will add responsibility for the South Market Group, which includes Argentina, Chile, and Uruguay.
Fernando Acosta, currently president of Avon’s Latin America segment, will retain responsibility for North Latin America, which includes Mexico, El Salvador, Guatemala, Honduras, Nicaragua, Panama, and Dominican Republic as well as the so-called Andean Cluster of Colombia, Peru, Ecuador, and Venezuela. Mr. Acosta also will take on additional responsibility as Avon’s head of global brand marketing.
Both will report to Ms. McCoy and serve on the company’s executive committee.
John Higson, currently president of the Europe, Middle East, Africa segment, will take on an expanded role as head of global field operations, which includes providing support to sales teams in Avon’s top 12 markets.
Chief Executive Sheri McCoy said that Latin America, Avon largest geographic market, represents more than half the company’s annual revenue. “Driving growth in our Latin American markets is a top priority for Avon, and adjusting the business management responsibilities between two seasoned Avon executives will allow for better management focus and sustained growth,” Ms. McCoy said.
Latin America represents more than half the company’s annual revenue
Avon last month posted a slightly larger-than-expected decline in revenue for its third quarter, hurt by weak foreign exchange rates and lower sales volumes. Still, the beauty company showed some signs of progress in its multiyear turnaround effort.The company has faced deep investor dissatisfaction in recent years as it failed to turn around a string of poor results and faced a federal probe into allegations of bribery of officials overseas.