Avon 2015 Annual Report Download - page 20

PART I
other documents are also available, without charge, by sending a letter to Investor Relations, Avon Products, Inc., 777 Third Avenue, New
York, N.Y. 10017-1307, by sending an email to [email protected] or by calling [phone]. Information on our website does
not constitute part of this report. Additionally, our filings with the SEC may be read and copied at the SEC Public Reference Room at 100 F
Street, NE, Washington, DC 20549. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-
0330. These filings, including reports, proxy and information statements, and other information regarding the Company are also available
on the SEC’s website at www.sec.gov free of charge as soon as reasonably practicable after we have filed or furnished the above-referenced
reports.
ITEM 1A. RISK FACTORS
You should carefully consider each of the following risks associated with an investment in our publicly traded securities and all of the other
information in our 2015 Annual Report. Our business may also be adversely affected by risks and uncertainties not presently known to us or
that we currently believe to be immaterial. If any of the events contemplated by the following discussion of risks should occur, our business,
prospects, financial condition, liquidity, results of operations and cash flows may be materially adversely affected.
Risks Related to Us and Our Business
Our success depends on our ability to improve our financial and operational performance and
execute fully our global business strategy.
Our ability to improve our financial and operational performance and implement the key initiatives of our global business strategy is
dependent upon a number of factors, including our ability to:
• implement our transformation plan, stabilization strategies, cost savings initiatives, restructuring and other initiatives, and achieve
anticipated savings and benefits from such programs and initiatives;
• reverse declines in our revenue performance and market share, and strengthen our brand image;
• implement appropriate pricing strategies and product mix that are more aligned with the preferences of local markets and achieve
anticipated benefits from these strategies;
• reduce costs and effectively manage our cost base, particularly selling, general and administrative (“SG&A”) expenses;
• improve our business in the markets where we operate, including through improving field health, improving our brochure and creating a
sustainable cost base;
• execute investments in information technology (“IT”) infrastructure and realize efficiencies across our supply chain, marketing processes,
sales model and organizational structure;
• implement and continue to innovate our Internet platform, technology strategies and customer service initiatives;
• effectively manage our outsourcing activities;
• offer a more compelling social selling experience, including the roll-out of e-commerce in certain markets;
• improve our marketing and advertising, including our brochures and our social media presence;
• improve working capital, effectively manage inventory and implement initiatives to reduce inventory levels, including the potential impact
on cash flows and obsolescence;
• secure financing at attractive rates, maintain appropriate capital investment, capital structure and cash flow levels and implement cash
management, tax, foreign currency hedging and risk management strategies;
• reverse declines in Active Representatives and Representative satisfaction by successfully reducing campaign complexity, enhancing our
sales Leadership program, the Representative experience and earnings potential and improving our brand image;
• increase the productivity of Representatives through successful implementation of segmentation, field activation programs and technology
tools and enablers and other investments in the direct-selling channel;
• improve management of our businesses in developing markets, including improving local IT resources and management of local supply
chains;
• increase the number of consumers served per Representative and their engagement online, as well as to reach new consumers through a
combination of new brands, new businesses, new channels and pursuit of strategic opportunities such as joint ventures and alliances with
other companies;
• comply with certain covenants in our revolving credit facility as a result of a continued decline in our business results, which includes the
impact of any adverse foreign exchange movements, significant restructuring charges and significant legal or regulatory settlements,
7553_fin.pdf 10