Avon, is this really possible/sustainable?

[ImFree2doasiwant]

I discovered today that a friend is earning 5k a month from Avon. She's some sort of team leader, and started by selling about 18 months ago. She does work quite hard at it by all accounts.

I'll admit to being rather gobsmacked! I thought avon was just "Avon ladies" with catalogues, and now online, taking your orders.

Has anyone else got experience of this? I'm really not considering it for myself (I've seen her social media, it's not something I'd be good at I don't think! )

I think the head office Huns are the most likely to be misled and brainwashed. They’re not doing it as an experiment to see if they make money, they’re fully signed up as permanent employees, relying on pensions etc from pushing an MLM scheme on others.

How much Avon does a rep need to sell to pocket £5000 profit a month?

@FireUnderpants

If there is no profit why does someone have to buy a lipstick to become a rep? Is there a free sign up option?

There isn’t but there was for most of 2020 (we sent a kit for free). There may be again in 2921 at specific times.

Because if you bought it online you’d pay delivery, and it’d be sent in cheaper packaging.

You’re paying £1 for delivery and better packaging. The lipstick is £8, the postage and packaging is £1.

@Smallsteps88

And I’d they’re making a loss on RRP then how on earth can Avon afford to sell all their products at 15% off to customers who sign forms?

You have a load of fixed costs associated with an order. Picking and packing in the warehouse for example. That means if you buy one lipstick yes we’d probably make a kiss. If you buy £50 worth of stuff and add one lipstick to it we’d make a little bit on it

Ahh you know I actually feel sorry for Avon now. They make such little profit for all their hard work.

@DoctorYang

How much Avon does a rep need to sell to pocket £5000 profit a month?

Good question. Assuming 30% commission, about 17k but that’s assuming it’s all their actual sales. In reality to earn that they’d have a big team so earn a much lower % on team sales. Hard to definitely say but poss around 49-50k across themselves and their team

@Smallsteps88

Ahh you know I actually feel sorry for Avon now. They make such little profit for all their hard work.

Agsin clearly I can’t share sensitive profit info here. It’s no more than you’d expect from an equivalent sized retailer.

That means if you buy one lipstick yes we’d probably make a kiss. If you buy £50 worth of stuff and add one lipstick to it we’d make a little bit on it

I assume kiss was meant to mean loss?

If so, no profitable business runs on this P&L structure where a consumer has to spend £50 (or even £20) for the company to make a 'little bit' of profit on an item like a lipstick. They cost $2-3 to manufacture and retail at $8-10.

A full size lipstick would not be a loss leader, it is a viable product in its own right on the site and there is enough margin built in for the company to have selected it as the product in the starter kits.

Not to mention their lies about animal testing. So many decent cruelty free brands out there why buy this crap?

It’s really quite sad that Avon is doing so poorly and probably going under due to making no profit. Awful.

I'd take it with a pinch of salt. Who buys Avon these days. Not seen an Avon catalogue for years.

Who buys Avon these days.

The reps.

It's not credible that a large company can't profit on an £8 lipstick.

Even so; many people's MLM stories include being encouraged to buy hundreds of pounds of product in the early months (the starter kit is just that, a starter).

I just looked on eBay and there's huge quantities of Avon product for sale there, listed by personal sellers. Wonder why.

Who buys Avon these days. Not seen an Avon catalogue for years.

Me

@youvegottenminuteslynn

That means if you buy one lipstick yes we’d probably make a kiss. If you buy £50 worth of stuff and add one lipstick to it we’d make a little bit on it

I assume kiss was meant to mean loss?

If so, no profitable business runs on this P&L structure where a consumer has to spend £50 (or even £20) for the company to make a 'little bit' of profit on an item like a lipstick. They cost $2-3 to manufacture and retail at $8-10.

A full size lipstick would not be a loss leader, it is a viable product in its own right on the site and there is enough margin built in for the company to have selected it as the product in the starter kits.

You’re broadly right but don’t forget fixed costs. It costs more to manage one item through the supply chain than the mark up. All businesses (ime) have a break even basket size and smaller baskets don’t cover their fixed costs.

Few lower value products are viable in their own right, but are as part of a basket.

Kiss=loss great auto correct for a lipstick related piint

Few lower value products are viable in their own right, but are as part of a basket.

The lipstick will have been chosen for the starter kit specifically because it has a larger than average (within the business) margin built in so will make less of a dent in profits than other items would.

I did appreciate the kiss autocorrect - very apt! And I do appreciate you answering people's questions, even if we disagree on most points.

@MLMsuperfan

I just looked on eBay and there's huge quantities of Avon product for sale there, listed by personal sellers. Wonder why.

This is a really good point. Not only is it competition for Avon bots (why would I order through a rep when I can get it cheaper on ebay) but it clearly shows that ex-reps are trying to claw back some money on their stock.

Are reps encouraged to hold stock?

If a customer makes an order, what is the delivery time and cost?

Good question. Assuming 30% commission, about 17k but that’s assuming it’s all their actual sales. In reality to earn that they’d have a big team so earn a much lower % on team sales. Hard to definitely say but poss around 49-50k across themselves and their team

Impossible then?

@MLMsuperfan

I just looked on eBay and there's huge quantities of Avon product for sale there, listed by personal sellers. Wonder why.

Exactly. The masses of product all over selling sites indicates that people are encouraged to purchase regardless of whether they have made sales. It indicates that the point of reward for uplines is downline purchases not sales. This is one of the key trip hazards for those at the bottom of the MLM pyramid: its Direct Purchasing not Direct Sales.

Anyone had a look at the Trustpilot reviews for Avon from online customers but more interestingly from reps?

My friend has sold Avon for 30 years. The most she makes is about £1000 a month and that is with a team of down liners beneath her.
She’s had a great career , made lord of friends so it’s owed her nothing..and I’ve never bought one product either

Well they aren't selling at cost then are they.... they are selling it at over RRP and throwing in some catalogues!

Even if they sold it for RRP they are making prob £50% profit minimum

Postage and packing doesn't cost that much (I used to work in retail. Especially on a lipstick!!I do have a scooby doo about this)

They are making money out of these starter kits. Trying to tell people they aren't is just outright incorrect.

And people wonder why people don't trust MLMs.....

@Smallsteps88

Because if you bought it online you’d pay delivery, and it’d be sent in cheaper packaging.

You’re paying £1 for delivery and better packaging. The lipstick is £8, the postage and packaging is £1.

@Smallsteps88 - you really are flogging a dead horse here.

Yes, MLM is hideous, Yes, Avon definitely is one, but drop the bloody lipstick costs now.

I don't know when you last posted something, but for me it was last week - you cannot post any package for £1 these days.

IF Avon were deliberately trying to rip reps off with the sodding lipstick, they'd charge more than £9. MLMs make their money on fleecing the reps for 'sales' - not by making a couple of quid extra on a single one-off purchase.

Yes, MLM is hideous, Yes, Avon definitely is one, but drop the bloody lipstick costs now.

Aside from the fact I dropped it an hour and a half ago why? Why do you want me to drop it? I can only think of one reason. It’s true. They are making a profit on those £9 “kits”, contrary to what the Avon hun is claiming.