Avon 1st QTR 2012 Earnings Report

Today, the venerable MLM and global giant Avon reported 1st Qtr 2012 earnings, which were down a total of 2% compared to this quarter in 2011. The total revenue for the company came in at $2.6 billion dollars for the quarter, and total number of representatives were down 2% as well.

As reported on the Avon Company Site:

Kimberly Ross, Avon’s Executive Vice President and Chief Financial Officer said: “While our first-quarter operating performance remained challenged, we are making progress toward addressing some of our operational and cost-cutting opportunities. With Sheri McCoy now on board, we are confident that her broad leadership experience and skills in managing large, complex, global organizations will help drive Avon’s future success. We look forward to communicating further with investors about our future growth strategy at the appropriate time.”

With all of that said, what do we at think this bodes for the venerable MLM Company.  A couple things you can read from this.

1) No need to panic, while total revenues WERE indeed down, but operating profit was $72 million dollars.

2) They have a new CEO on board, Sheri McCoy, who comes with a wealth of experience in associated businesses.  This is such a huge thing, as they appear to be making changes at the top after so many years of the same kind of leadership.

3) They are still expanding overseas, namely in Asia, which will continue to drive growth overall for the company.

4) In terms of their North American Operations, we are indeed still in a down economy, and people do tend to “try MLM’s” when times are tough and they are considering other options, this time period being no different.

So, despite the fact that the 4th quarter was rough as well, they do appear to be taking positive measured steps to keep things going from a financial perspective, which can only be good for distributors.

Click this link to download the financial tables as reported by Avon

What do you think about their financial news?  Leave a comment on what you think below.

Empower Network Launch Officially on 6 June.

The Empower Network launch is set to officially launch to the world as its own company 6 June 2012, as part of a celebration of it’s accomplishments.

As announced on PR Web,

“Looking into the bright future ahead, the official Empower Network launch event will act as a catalyst into gaining massive momentum and is sure to deliver ‘life-changing’ information. Do not miss or lose out on the opportunity to be live and present to absorb everything come June 8th-10th in Atlanta, GA at the OMNI Hotel.”

Now with all of that said, and not getting too much into WHAT empower network really is, the question is, does it really matter?

I’ll be honest, the “viral marketing” system they have has been one of the most curious things to see in the last couple of months in MLM.

Originally touted as a viral blogging system, they also have an educational system on the back end, as part of it as well, and now, with the announcement that they will officially launch as a company, and as it reads in the press release, what is the deal with it?

From my own standpoint, I’ve never joined Empower, been a member, or anything, and as I see it…..the system really caters to those who work and concentrate in online MLM.

Certainly, the appeal of instant 100% commissions is alluring, and one of the main selling points is that you can use it as a platform to market any aspect of your business, whether it is the opportunity, or products, or whatever…..there is absolutely a certain truth to that.

However, the there is little truth to “blogging, sharing, and making money”, as there is a lot more to online marketing than that, truth be told.

One the flip side, one of the falicies that many will not talk about in online MLM is that when you launch your own site…..it will absolutely take a while to get traffic to it, as it has little “authority” so to speak, and this can take quite a fair amount of time….so there is a valid argument to getting in on this empower network launch.

Undecided here.

What do you think about it?

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MakeParties.com Review

MakesParties.com is a unique networking marketing group that specializes in providing party supplies. Try to determine if their setup is ideal for your business needs. You will be taught how to properly run and manage the business, as well as develop new ways to stay at the top of the competition.

About the Company

MakesParties.com is a huge provider and distributor of party supplies. It is currently the internet division of Sherman Specialty Corporation, which has been in the industry since 1953. MakesParties is based at 300 Jericho Quadrangle West, Suite 240, Jericho, New York 11753. You can contact them through telephone at 516-861-6482 or send a fax at 516-861-1033. The company offers a more convenient shopping approach for customers looking to buy party supplies. The group is confident in the quality of all its products and boasts of having very good customer service. You can expect expert advice and the best recommendations when it comes to preparing the best parties and events.

The website has been operational for 15 years, but the company continues to innovate and enhance the features to better cater to the needs and requests of thousands of customers all across the United States. The company has also partnered with Commission Junction to give publishers added features and capabilities like real-time reporting, third-party tracking, regularly updated links, updated product feeds, commission checks every month and promotions. The shopping experience of customers is one of the best they will ever have. The MakesParties.com affiliate program was first introduced in 1998 and has also improved much since. There are now thousands of clients and affiliates that continue to offer quality party goods and items at the best prices. The partnership with Commission Junction is expected to produce excellent results to satisfy customers more. Quality customer service and quality user experience are big priorities for the group.

The Affiliate Program

Their affiliate program offers two ways for representatives to earn money. The first and basic approach is to sell party products and items to people you know. Grow your customer base and add new clients every time so you can earn a commission based on the total products you sell each month. The second way to generate income is by searching for more people to become affiliates of the network. You will receive commission for every person you successfully refer into the program. You will also gain passive or residual income from the sales of the people you enter into the group. The goal is to sell as many items as possible to boost your sales per month and also introduce the company, offerings and affiliate scheme to your friends, family and business contacts.

About the Products

Not surprisingly, they offer for sale as personalized items, party theme supplies, glow items, masks, banners, flags, confetti, personalized frames, personalized plates, personalized cups, noisemakers, trinkets, inflatables, baskets, balloons, toys, horns, sunglasses, paper goods, hats, candy, favors, unique mugs, maracas, musical items, decorations, giveaways, tokens, etc. Everything that will complete your party or event will be delivered right to your doorstep. The company can ship nationwide or internationally. Shipping rates will differ depending on the size of the order and the location of the client. Clients can also pay through a variety of methods like credit card, debit card and purchase order. For purchase orders, the form must be completed first. Registration is also needed for the company to identify the parties.

The products offered by the company are great for any occasion, regardless of the size, importance and date. You can have themed and personalized party items for events like birthdays, weddings, Halloween, New Year, Christmas, valentine’s day, corporate events, business shows and exhibits, showers, decade parties, anniversaries, Mardis Gras and many more.

Conclusion

Indeed while the idea of promoting party products sounds good, I mean, everyone hosts parties, right?  So the potential market could be huge, correct?

However, that is not how I think of it.  Rather I see the products that you would need an extremely high volume to make any significant money on.  That coupled with the purchases really being non-repetitive, maybe once or twice a year per family would make this an extremely tough sell and hard to get form a part-time income to full time.

What are your thoughts?

MLM Tax Deductions

We’ve covered this in the past a bit, and I know that this is the day AFTER tax day here in the United States, but I just wanted to pass on a list of MLM Tax Deductions that have taken here for you to set yourself up with in the future.

Now, let me first say that I am not an accountant, not an expert on taxes, nor do I claim this to be financial advice.  If you want professional advice, to go ahead and see your own accountant and use your common sense as well.

Bleh, now that we got that out of the way.

Here is a list of things to consider taxing as an MLM tax deduction, and should consider setting yourself up with for next year.  This is the kind of stuff that I brought to my own accountant for his to work his magic with.

List of Network Marketing Tax Deductions

- Home Office Deduction – This is the big one and a touchy one.  The key here according to my account is to have an area set-aside specifically for Business, and use it only for that.  With that, there are tons of things you could possibly deduct, including % of mortgage, heat, electricity, etc.

- Educational expenses – This is one we forget about alot, it can range from anything like training pamphlets from your company, or getting a copy of Simple MLM Leads or other trainings available in the industry.  Anything you can think of that you purchased or used that could be considered professional education.  You do treat your business like a real one and a profession, right?

- Website Costs and Internet Access:  Everything ranging from your own company replicated website (which can be great as a sales tool….not marketing tool), to setting up your own blog (more on that later), to auto-responder costs, etc.

- Advertising costs:  This can be huge, especially if you are an established business owner and actually advertise.  This can even range from flyers, business cards, SEO Services, Facebook advertising, to more mundane things.

- Childcare Costs:  Do you ever pay for a babysitter to meet with clients, or events?  I know we do, alot in fact.

- Mileage:  Self-explanatory, but you’ve gotta keep careful track of it.

- Mailing Fees

- Product Samples (We give out a tons in our warm market)

- The Cost of Joining a Business: Did you join a business this past year? These can range from a couple bucks to hundreds of thousands of dollars.

- Legal Fees like setting up an LLC

- Professional Membership fees.  Do you belong to Better Networker, or the local BNI group?

- Convention Costs, fees, meals at conventions.  These can easily cost upwards of $1K or more for a single person or more.

Anyway, these are just a couple of the things and items I had brought to my accountant for legit expenses and should be enough for your to get the ball rolling this year.  Remember to keep records.

Most importantly, treat your business like a business and it can reward you as such.

What do you think?

Do you have any to add?  I’d love to hear your thoughts.

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MLM FTC Ruling Would Have Help Protect New Business Builders

Last month, a ruling by the FTC that was intended to help people from unscrupulous practices of those in the Direct Selling industry was passed.  Essentially, it would have required those MLM companies to required confirmation and present to new business builders a “one pager” of information such as proof of income claims, and any other legal action that the company itself might have been under.

However, as reported in the Bloomberg Business Week

But the FTC rule, which went into effect last month, excludes so-called multi-level marketers (MLMs) such as Amway, Avon , and Tupperware  that the agency originally intended to regulate. That’s because of intense lobbying from the industry, whose revenues are some $28.5 billion in the U.S., according to the Direct Selling Association, the industry’s trade group.

Does The FTC Need To Regulate MLM Companies Like This?

What i find most interesting about the whole thought is that why would MLM companies be against such action?  As long as I’ve seen and been involved in the industry, I’ve honestly seen a good number of companies and distributors completely miss-represent income claims and even more deceptively, miss-represent their products as financial investing alternatives, make false claims, especially without any kind of rigorous study, about health benefits, you name it.

I do find it understandable that an industry would balk at any additional requirements, as for the most part, they feel they can police their own, but on the same tolken, the article also reports that Amway paid out $55 million dollars in settlements in California last year to settle a class action lawsuit.

Personally I’d be all in favor of some kind of a one-pager disclaimer being required, as it would separate many legitimate companies from those with unscrupulous business practices.

Equally as important, it would take some of the exagerated income claims and silence them.

What do you think about a one-pager such as this for distributors if an MLM FTC ruling like this ever came into enforcement?

Monavie Dallin Larsen Announcement

Recently, Monavie, one of the leading health juice beverage companies announced that several people were moving around in their company into new positions.

As reported in this corporate video, some of the highlights of the moves were:

- Randy Schroeder, who has been serving as the Chief Executive for the company in Europe has now accepted and taken on the additional role of being the chief executive in North America  as well.  This obviously is a huge move for Randy Schroeder, but his service in Europe indicates that he is up to the challenge.  Randy himself joined the company as a distributor in 2008 and quickly was asked to join the corporate structure as an executive.

- Jeff Graham was notified as the “Executive Vice President of Global Product Strategy”.  Jeff himself has been with the company in various roles since 2005.  Again, according to the video

“Jeff has been with us from the beginning and he’s a loyal and trusted member of this team. He is passionate about creating and marketing unique, cutting-edge nutritional products, and we are fortunate to have someone with his talents and commitment to help guide the next phase of our company’s strategic product development,”

What do all these moves by the Mona Vie MLM mean?

Could it be that this move especially Schroeder’s signals that the company feels it has to rely on it’s “Aces” in order to continue to grow at the torrid pace it has maintained since its launch in 2005?

Our opinion here is that this could indicate that there are troubles in the North American division, and needs to bring in one of its heavies to help sort things out.

What does this monavie Dallin Larsen announcement mean to you?

Avon CEO Search Over

In what was not an entirely surprising news, the MLM Business giant Avon CEO search is over as the replacement for Andrea Jung was announced.   The company announced that Sheri McCoy, a long-standing Johnson and Johnson manager and leader will take Andrea’s place following the effective date of her resignation from her current company on April 18th.

Interestingly enough, McCoy was passed over recently for the top position at Johnson and Johnson.

There are several reasons that Avon itself has been searching for a new CEO, but namely because of declining North American sales over the last few years, despite a $10 billion in annual revenue.

According to Avon in this article:

“Sheri has a unique combination of strategic and finely-honed operational skills, a significant turnaround track record, global experience and people leadership,” Fred Hassan, lead director of Avon’s board, said in a statement on Monday.”

One of the major features of bringing in McCoy is to separate the CEO and chairman positions.

Now, the real question is, will this make a huge difference with Avon?

More than likely, no, at least not in North America.  While revenue might stabilize in North America, there is such tremendous competition between Avon and other brands here that it is probably going to be too difficult to make a huge resurgence and bring the brand name back to its dominant form that it help here for years.

For years, the “Avon Lady” was practically synonymous with an upwardly mobile at-home/working woman.

Time will tell whether the new Avon CEO search ending with McCoy can turn around the ship here in North America.

Top 100 MLM Companies April 2012

Below is a listing of the top 100 MLM Companies, according to web traffic rank for April 2012

How is this web traffic rank measured?  Its a measure of the their alexa traffic rank, a website ranking site.  While by no means is this a perfect measure of the rankings of different companies, and is not a measure of the revenue rankings, it is a measure of how active their home websites have been, and in turn how active their distributor base is in getting people to their sites and in turn raw sales numbers.

However, in addition, a company that has seen a dramatic increase in the last couple of months in web traffic growth clearly is on the rise.

Without further addoo……the top 100 MLM Companies for April 2012.

Now what do you think?

Was your company on there?

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Send Out Cards Gets Innovation Award

The innovative MLM company Send Out Cards recently was awarded an innovation award from the United States Postal Service on April 2, 2012.

According to the United States Postal service, this award is granted to certain postal customers who have shown that they have used mail in order to bring significant growth of business through mail.

In what apparently was a large reason for the award being granted was their work on what is known as picture postage, which has been a four year project for them.

According to their Chief Operating Officer Sam Robinson:

“SendOutCards is proud to have received this award,”  “We’ve invested years of meticulous time and energy to find ways to further help our customers and distributors touch the lives of millions more people. It’s a great feeling to have accomplished that and to be recognized for it with this great award.”

I think this is another major move by main street America of growing acceptance of the Direct Sales Industry

Avon Cody Deal Rejected

In one of the more interesting developments recently in the Direct Selling niche, Avon was recently offered roughly $10 billion dollars from Cody Inc. for an outright purchase of the venerable 125 year old company, effectively making the Avon Cody deal dead for now.

This offer lead to a 19% rise in stock price for Avon, going up to $23.10 at one point on 2 April.

Cody Inc itself is no stranger to the cosmetics field, as it has its own line of products in Europe and generates $4.5 Billion in annual sales itself.

Interestingly, the offer itself was made and rejected over two weeks ago, and was just recently made public.

According to CNN.com

…said it decided to make its offer public “in order to inform Avon’s shareholders of the significant value in a transaction.” Coty said its announcement has followed “extensive but unsuccessful attempts to engage Avon in discussions regarding its proposal,” but that it does not to plan to pursue a hostile takeover.

So, in the end, clearly Cody is very eager to get this deal done.

This could be because of end of the year financial troubles from Avon itself, as its total year to year revenue decreased roughly 4% during 4th quarter  Avon 2011.

Why did Cody make the offer to buy the venerable cosmetics giant? According to the a statement released by the company.

“At the time, the board concluded, and it still believes, that Coty’s indication of interest is opportunistic and not in the best interest of Avon’s shareholders,”

What do you think about the Avon Cody deal?