It was only in last September that Avon announced it would withdraw from the U.S. Direct Selling Association. This was quite an important move for three reasons:
1) Avon was the second largest direct selling company in the world.
2) The company was one of the 10 founding members of the U.S. DSA.
3) When leaving, the reasons it listed were quite shocking, to say the least.
What were those reasons? Here they are:
• The U.S. DSA’s agenda was overly-focused on the issues of a few brands rather than industry-wide challenges. There was also a need to enhance the DSA Code of Ethics. However, Avon did not believe the current U.S. DSA would address neither of these.
• Avon’s model did not rely on sales of inventory, training or support materials between representatives. The core of its business model was based on representatives selling products to end-consumers.
• Avon had reasonable return policies so representatives were not left holding excess inventory.
• Avon limited representative earnings to three generations, with no promises of commissions on infinite sales, incentivizing representatives based on their sales to customers.
And in the same announcement, Avon said this move would be limited to the exit from the U.S. DSA and it would stay at the World Federation of Direct Selling Associations (WFDSA) and at other country associations.
When I covered this story last September, I finished my article speculating as, “Maybe Avon has plans to team
up with Tupperware in the future. We don’t know that yet. To remind, Tupperware is no longer a member of DSAs in several countries including the U.S. And in Europe, it supports Direct Selling Europe, a separate organization.”
Two weeks ago Direct Selling Europe announced Avon would join them leaving Seldia, the European association representing the “other, larger group”.
Any guesses on Avon’s possible next move? How far do you think Avon will take this?
