Avon (NYSE:AVP) plans to cut another 400 jobs and exit certain underperforming markets as part of an earlier-announced multi-million dollar restructuring intended to streamline the business while enhancing its presence in more lucrative regions.
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The New York-based retailer, which relies on active reps to directly sell its beauty products, said Monday it will close operations in some smaller, less profitable markets so that it can focus on what Avon calls “high priority” areas like Brazil.
Operations will be shut in certain regions of Europe, most notably Ireland, as well as in the Middle East and Africa, while the layoffs will occur throughout 2013 and impact all regions and functions.
The streamlining is expected to save about $45 million to $50 million annually. The company expects to incur charges this year related to the overhaul in the range of $35 million to $40 million before taxes, of which about $20 million will be recorded in the first quarter of 2013.
Avon, which has over the last year been undergoing a massive restructuring intended to ultimately save $400 million annually, revealed stronger-than-expected fourth-quarter earnings in February as it continued to cut costs while growing its base of active reps in emerging markets.
“We continue to work aggressively toward turning around the business," Avon CEO Sheri McCoy said in a statement. "The steps outlined today take us closer to our cost-savings goal.”