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Avon’s Brazilian Growth May Warrant Second Facility

By: Fernanda Bonifacio
Posted: June 22, 2010, from the July 2010 issue of GCI Magazine.

Hand sorting on one of Avon’s current São Paulo production lines.

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A survey conducted by Brazil’s Ministry of Health showed that 58% of the Brazilian population has no regular access to toothbrushes and pastes. Even with an improvement in the scenario (in 2003 the rate was 65%), the potential growth of the segment is still substantial in the country.

According to Gilberto Pucca, coordinator of the Smiling Brazil Program, the problem is not restricted to less developed regions—it also impacts the outskirts of large cities. Aiming to improve oral health of Brazilians, the federal government conducted a campaign that distributed 40.6 million oral care kits throughout the country.

However, to reduce the cost of these products, the first step would be to review their tax burden, which according to the Brazilian Association of the Cosmetic, Toiletry & Fragrance Industry (ABIHPEC) is 41.4% for toothbrushes, 37.8% for toothpaste, and almost 60% for mouthwash. The organization believes that lower prices could double the sales volume for the category.

Walmart Creates Sustainable Campaign

Walmart Brasil—with cooperation from Johnson & Johnson, Colgate-Palmolive and Procter & Gamble—launched a campaign to reduce the environmental impact of products on its shelves.

“We are supporting the development of more sustainable products, generating a virtuous cycle of conscious production and purchase,” said Héctor Núñez, president, Walmart Brasil. According to him, changes in the products will range from packaging (including recyclable and certified options) to reductions in energy consumption and water.