Avon is a company selling beauty and related products. The service provides customers with products of the highest quality. It provides a service to customers that is outstanding in its helpfulness and courtesy. Why I have chosen this business I have chosen this organisation for my coursework because it is large enough to research into all areas of the business. There are several different departments and there is a management structure to it. This will help in my coursework as I can include details of this. My contact within the organisation is my dad who works at Avon as an electrician.
Avon’s aims and objectives All businesses have aims they want to achieve. Objectives are what help them plan what they have to do to achieve their aims. Aims are the overall goals that the business was set up to achieve. Objectives are specific targets that must be achieved to ensure the business achieves its aims. Typical aims that a company may have include: Making a profit Providing goods or a service Surviving as a business Expanding Maximising sales Improving quality of a product or service Being environmentally friendly Providing charitable or voluntary services
Providing a highly competitive service Avon’s five values, and our principles as expressed by the company’s founder, David H. McConnell has served as a progressing source of strength throughout Avon’s history. The five values of Avon – Trust, Respect, Belief, Humility and Integrity. A mission statement is the objective that supports all others. The importance of the mission statement is it: Communicates the objectives and values of the organisation Influences employee behaviour and attitudes Helps in achieving correspondence Avon’s mission statement
‘To be the company that best understands and satisfies the product, service and self-fulfilment needs of women – globally. ‘ The importance of having objectives are: They act as management targets They are a standard against which performance can be measured They help to bring staff together When linked to pay or rewards they can encourage staff Objectives must be SMART to be effective. This means they must be SPECIFIC – e. g. for a particular area MEASURABLE – e. g. percentage sales or profits ACHIEVABLE with extra effort REALISTIC TIME CONSTRAINED -must be completed within a certain time period. Task C
Avon’s objectives * To be the global beauty leader We will build a unique portfolio of beauty and related brands, striving to surpass our competitors in quality, innovation and value, and elevating our image to become the Beauty Company most women turn to worldwide. This objective is achievable, as by looking at Avon’s sales in the graph on the right, Avon is becoming more popular and the increase in sales shows more customers are choosing Avon. If this pattern continues, Avon may become the company most women turn to. The objective does not have a time restraint, but I think this objective can be ongoing forever.
Competition is very important in business. A company without competition will find it hard to set targets for themselves as they will have no one to compare their profits or number of customers with. Another problem would be the hardly improving labour productivity. This problem can be solved by encouraging foreign competition, and by enhancing market transparency. Avon’s competitors are stores such as Boots, Body shop and Superdrug. These are not entirely the same, as they are shops, whereas Avon’s customers order by catalogue. This may cause Boots to have more customers as they can see the product and test it before it is purchased.
Boots also have a wider range of products, such as electrical, food, clothes and also departments for photography, opticians and chemist. I have chosen to compare Avon to Boots, a company also selling cosmetics. I will also compare it to Maybelline, a manufacturer of makeup. Compared with Avon’s mission statement, Boots is a lot broader. Boots – ‘Our goal is to make Boots a more modern, competitive and efficient retail business in order to deliver value for our shareholders’. This statement is broader and refers to more things because Boots sells many other products other that cosmetics ad has branches of shops all over the country.
Avon is aimed more at a female audience, although they sell men’s items too. ‘That best understands and satisfies the needs of women’. The mission statement for Avon ends with ‘globally’, showing that the quality of service if the same all over the world. Task D Types of business Sole trader A sole trader is the simplest form of business. There is only one owner, who has total control over the decision making and running of the business. The owner is self-employed. It is very easy to set up a sole trader business, as there are not many legal processes to go through. Private limited companies
These have the word. ‘Limited’ after their name, indicating that the company is owned by shareholders who have limited liability. They are often abbreviated to Ltd. Liability: the shareholders’ personal assets are protected if the business falls. You can only lose what you have put into the business. Management: The business is controlled by the board of directors. They are each held personally responsible for it’s management and must act in the company’s best interest. Finance: Capital is raised by the sale of shares, although not to the general public. Profits: Dividends are paid to the shareholders.
Taxes: The directors are employed by the company through the PAYE tax system. Continuity: The Company is a legal entity in it’s own right and can be sold, or buy shares in other companies. It has ‘perpetual existence’. Public limited companies The main difference between private and public limited companies is that public limited companies have no restriction on the number of shareholders or on the freedom to buy and sell shares. Shares in public limited companies can be bought and sold on the stock market at any time by individual members of the public, other companies or organisations.
The company is generally the same as Private limited companies. There are four main types of company: Private company limited by shares – member’s liability is limited to the amount unpaid on shares they hold Private company limited by guarantee – member’s liability is limited to the amount they have agreed to contribute to the company’s assets if it is wound up. Public limited company (PLC) – the company’s shares may be offered for sale to the general public and member’s liability is limited to the amount unpaid on shares held by them.