After confirming its withdrawal from Vietnam and South Korea, direct seller beauty company Avon is now reportedly planning to trim its network in China.

Avon is said to be closing 12 direct sales branches in China, according to a report in Want China Times. While the company has been in China since 1990, its business did not prosper and has been reporting continuing revenue decline for some years. Analysts blamed its poor performance on its lack of effort to adapt to domestic market.

Reduced advertising, a high number of product returns and bad publicity have also affected its ability to generate profits, says the report. Besides direct selling, Avon ventured into traditional retailing by opening stores when the Chinese government imposed restriction on direct sales. However, operating two sales model made it even harder for the beauty company to generate profits.

The closure will take the number of branches to 32 from 44 and is expected to affect as many as 200 jobs.

Last month, Avon announced its plan to shed around 1500 jobs in a bid to stabilise its business. It will also concentrate resources on markets with high potential and significant growth opportunities.

GB