The global cosmetics direct selling giant Avon Products Inc predicts its business in China will grow by 50 per cent  in the second quarter of this year, and expects its revenues to hit US$400 million by 2007.

Andrea Jung, Avon's chairman and chief executive officer, said the underlying health of Avon's business worldwide remains "extremely strong," and revenues will reach US$8 billion this year.

"We continue to make excellent progress with our strategies. And China takes an important place (in) our moves," said Jung during her recent visit to Beijing.

"China is Avon's No 1 growth opportunity in Asia, maintaining an annual growth rate of 30 per cent."

Jung praised the success of the beauty boutique sales model in China - the first trial in the giant's 117-year history.

The beauty boutiques are independently owned and operated by private entrepreneurs who exclusively sell Avon products.

Avon started to sell its products through beauty boutiques after China banned direct selling in 1998. So far, there are 5,500 boutiques in the country's 74 cities.

"The beauty boutiques are the lifeblood of Avon in China," said Shou-Kang Kao, president of Avon China. He said Avon China will keep the boutiques while developing new direct selling methods that conform to new Chinese regulations expected to be out this year.

The company has already introduced 70 per cent of its 50,000 product lines to China and will continue bringing more products to Chinese customers, including the test launch of its Avon Life wellness products.

The Avon Life product formulas come from best sellers in markets such as Japan.

The company said it has years of experience in developing wellness products.

"As the company for women, Avon seeks to provide women with holistic care, including promotion of good health," Jung said.

Avon markets to women around the world through 4.4 million independent sales representatives. Its product lines include Avon Color, Anew, Skin-So-Soft, Avon Solutions, Advance Techniques Hair Care, Avon Naturals, Mark and Avon Wellness.

(China Daily 06/25/2004 page10)