Supply Chain

This week the mark. interns joined  the Avon interns to talk about Avon's supply chain.  We heard from Michael Watson, Vice President of Supply Chain.  And for Avon--supply chain means GLOBAL!  Michael has been with Avon for ten years now, and has been to over 50 countries.

Here are some notes I took during his presentation...

Avon has 11 distribution centers around the world; only 2 are in the United States, 1 of which is in Cincinnati--and that one is actually closing.

Because Avon sells on a 2 week campaign, it is always a struggle to find a strong partner when it comes to distribution.  Michael admitted that its rough to sell something one week and then not sell it again for weeks later.  It's hard to find another company that can keep up with that kind of change.   Their strategy, Michael said, is to respond and react quickly, and try to forecast to the best of their ability.  (mark. is on a monthly cycle, so the process is not as brutal for the mark. side of the business)

All of Avon's non-beauty products are outsourced.  They have design teams that research and create the product, and then find someone use to produce it.  Most of the time, the far East offers the best opportunities for this kind of production.  Actually, 50% of Avon's sales are outsourced.  This number is too high for Avon's officers, who want to lessen that percent and in turn lessen the cost and risks that come along with outsourcing.

Avon has 3 manufacturing facilities in the United States.  There is one in Zanesville, Ohio--which is actually the greenest plant they have!

Michael's two biggest challenges at Avon are 1. product availability and service, and 2. how to change the Avon experience.  He has been working hard to overcome these obstacles and make Avon an even greater company.

Getting to meet Michael and hearing this side of the business was surprisingly interesting.  It came at a perfect time, giving us a break in the usual busy day and hearing about something that we often over think--how product are developed and distributed.