Avon Products Inc., giving details of a restructuring plan announced in February, said it will realign its global supply chain and streamline operations in key locations to improve efficiency.
The changes, resulting in a second-quarter charge of about $77 million, will eliminate about 1,200 positions when the initiatives are fully implemented by 2012-2013, Avon said.
Among the changes, in North America Avon will close its facility in Springdale, Ohio, by mid-2012, shifting that production to sites in Morton Grove, Il., and Celaya, Mexico, and to contract manufacturers. In line with this, the Springdale-based returned-goods operation will be relocated to another Avon U.S. facility or outsourced in the U.S.
In Europe, the direct-sales cosmetics company plans to shut a manufacturing facility in Germany and move production to Poland and to contract manufacturers. Avon also will merge its marketing departments in the U.K. and Spain to create a single organization to serve markets across Western Europe, the Middle East and North Africa.
Chief Financial Officer Charles Cramb said the latest moves reflect almost half the costs of the restructuring plan, and are expected to generate approximately 60% of the targeted annualized savings of $200 million by 2012-2013.
Logo from Avon