AVON ANNOUNCES THE CLOSURE OF ITS FLAGSHIP NYC DAY SPA

Avon announced that it is closing its salon and spa in Manhattan on June 16, after eight years of operation. Avon's only spa is prominently located in Trump Tower on Fifth Avenue. The ground floor retail space will also be closing, but no date has been set yet, a spokesman said.

Avon is the world's leading direct seller of beauty and beauty-related product. Founded in 1897, the company did $8 billion in sales last year. The New-York based company suffered losses in 2005, however, due to increased competition in the skin care market. Management changes to overcome last year's setback include a cost cutting effort and an increase in advertising spending.

Avon announced more than 1,300 job cuts at the beginning of May, bringing total job reductions to over 3,300. Almost 40 percent of those reductions come from management, said Chairman and Chief Executive Andrea Jung. She said that the management cuts alone should save the company more than $150 million.

Industry experts familiar with the New York spa scene concur that the spa closure was a smart move. Spa Finder President Susie Ellis comments on her blog , "Avon will likely be happy to give up what must be sky-high rents at Trump Tower and the high labor costs which are common in the spa industry." Bruce Schoenberg, CEO of Oasis Day Spas agrees: "A spa that does not negotiate their lease properly will not be able to survive, especially in New York City's high rent areas."