Although in the US it was declared bankrupt in an attempt to clean up its finances, the cosmetics company that was a pioneer in the direct sale of these products continues to operate in the country. How did he succeed?
With a millionaire debt in the United States, afflicted by criminal complaints and after becoming a reference for the direct sale of cosmetics in the world, Avon Products Inc must have declared bankruptcy In that country, hosting Chapter 11 of the US Bankruptcy Law that allows companies to immerse themselves in a process of financial sanitation. Despite the seriousness of the situation, Avon in Argentina continued to operate thanks to Natura & Co.
Indeed, the Brazilian who acquired the international business of AVON in 2020 by 125 million dollars, He supported the bankruptcy reorganization process in the United States financing about 43 million dollars as a debtor in possession. In practice that gave liquidity so that Avon Products could finance its obligations as indicated by a statement at that time.
The commercial debacle in the USA came along with a process in which the firm had to meet multiple judicial demands that had an impact on their credibility at a time when the growing competition was strengthened in the market. In that sense, in 2022 Avon had to compensate a woman from Arizona with more than 50 million dollars after a jury in Los Angeles considered that the talcus contaminated with asbestos of the products used by the woman could be the cause of cancer that had been diagnosed.
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Last June, meanwhile, the US justice ordered Avon to pay compensation of almost 25 million dollars to a former worker from one of its plants located in Illinois also for having received a diagnosis of cancer attributed to the products it would have inspired.
Natura’s role so that Avon’s bankruptcy does not affect Argentina
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Avon’s agreement with Natura & Co was the company’s safe -conduct. The financial aid received at the end of last year assured that the brand continues to function in International marketswith special emphasis on Latin America. In fact, as soon as the situation of the company in the United States transcended, Natura & Co issued a statement in which he assured that the international market – especially that of Latin America – would not be affected by bankruptcy.
In this way, in our country, the request for Chapter 11 of the Bankruptcy law He did not impact his sales from Avon. However, the arrival of the Brazilian to its capitals seeks to renew the airs of the cosmetic company by aggiornating its commercialization and resuming that idea of the sale of cosmetics as a source of empowerment for women. After being for years owner of the direct trade of cosmetics the model was obsolete in front of the competition.
Source: Ambito
