The pink Cadillac. The "Ding Dong! Avon Calling" chime. For decades, those were the symbols of a direct-selling empire that seemed bulletproof. But lately, you might have noticed things look a little different—or a lot more complicated—for the company that practically invented the side hustle. If you're wondering what happened to Avon, the answer isn't a single event. It's a messy, multi-year saga involving massive lawsuits, a global split, and a Chapter 11 filing that caught plenty of people off guard.
Honestly, it’s a bit of a tragedy. My grandmother had those little lipstick samples tucked into every drawer. Most people over 30 have a memory of an "Avon Lady" in their neighborhood. But nostalgia doesn't pay the bills, and it certainly doesn't stop a wave of litigation.
The August 2024 Bankruptcy Filing Explained
Let's get the big news out of the way first. In August 2024, Avon Products, Inc. (API) filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the District of Delaware. Now, before you think the brand is vanishing from the face of the earth, there is a catch.
This specific filing was for the non-U.S. holding company.
Basically, the company was drowning in debt related to lawsuits claiming their talc-based products caused cancer. We’re talking about hundreds of millions of dollars in legal fees and settlements. By the time they hit the "reset" button in 2024, API had already spent over $225 million defending itself against nearly 400 personal injury lawsuits. They simply didn't have the cash to keep fighting.
The irony? The Avon business you see in the United States today isn't even owned by the company that filed for bankruptcy. It’s a corporate divorce that leaves many shoppers scratching their heads.
The Great Divorce: LG and Natura
To understand what happened to Avon, you have to go back to 2016. That’s when the company split into two separate entities. The North American business—the one in the U.S., Canada, and Puerto Rico—was spun off and eventually bought by LG H&H (a giant South Korean consumer goods company).
📖 Related: Private Credit News Today: Why the Golden Age is Getting a Reality Check
The rest of the world? That stayed under Avon Products, Inc., which was later acquired by the Brazilian beauty powerhouse Natura &Co in 2020.
So, when you see headlines about "Avon Bankruptcy," it’s mostly referring to the international side of the house. If you live in Des Moines and your neighbor sells you a Skin So Soft bath oil, that business is currently stable under LG. It’s confusing. It’s corporate gymnastics. But it matters because it explains why some people are losing their jobs while others are still hosting "watch parties" on the app.
The Talc Trouble That Broke the Bank
Why talc? For years, talcum powder was a staple in cosmetics to absorb moisture and provide a silkier feel. The problem is that talc is often mined in close proximity to asbestos. Plaintiffs in these lawsuits argue that Avon’s products were contaminated with the carcinogen, leading to cases of mesothelioma and ovarian cancer.
Avon has consistently denied these claims. They’ve stated for years that their products are safe. But juries haven't always agreed. In one high-profile 2022 case, a Los Angeles jury awarded $50 million to a woman who claimed she developed cancer from using the company’s powders.
A $50 million hit is a lot for any company. Multiply that by hundreds of potential cases, and you see why the bankruptcy lawyers were finally called in. It was a strategic move to "ring-fence" the liability and try to settle everything in one go rather than bleeding out one courtroom at a time.
Why the "Avon Lady" Model Struggled
Beyond the legal drama, the world just changed. Direct selling—or Multi-Level Marketing (MLM) as it’s often called—has a bit of an image problem these days.
👉 See also: Syrian Dinar to Dollar: Why Everyone Gets the Name (and the Rate) Wrong
In the 1950s, being an Avon rep was a radical path to financial independence for women who weren't "allowed" in traditional offices. It was social. It was revolutionary. But then came the internet.
When you can buy high-quality, cheap makeup on Sephora, Ulta, or even TikTok Shop with two clicks, waiting for a neighbor to drop off a paper catalog feels like a chore. The company tried to pivot to digital. They launched "e-brochures" and gave reps their own websites. But for a long time, the tech felt clunky. While brands like Glossier were building massive communities on Instagram, Avon was still trying to figure out how to get their aging demographic to use an app.
Is the Brand Dying?
Not exactly. Natura &Co, the Brazilian owners of the international branch, are actually trying to buy the business back out of bankruptcy. They offered $125 million to take over the operations, minus the crushing debt.
They believe in the brand. In places like Brazil and parts of Europe, Avon is still a massive player. It’s a household name with a huge footprint. But it’s no longer the undisputed king of the hill.
The brand has also faced stiff competition from "clean beauty" startups. People are more scrutinized about ingredients than ever before. When a company is fighting lawsuits over talc, it’s hard to convince a Gen Z shopper that your products are "natural" or "safe," even if you’ve reformulated everything to be talc-free.
The Reality of Direct Selling in 2026
If you’re thinking about becoming a rep or you’re a loyal customer, here’s the ground truth. The company is in a transition phase that will likely take years to resolve. The bankruptcy will allow them to clean up the balance sheet, but it won't magically fix the brand's reputation or its outdated sales model.
✨ Don't miss: New Zealand currency to AUD: Why the exchange rate is shifting in 2026
Social selling is the new buzzword. It’s what influencers do. Avon is trying to turn their reps into influencers, but it’s a crowded space.
What You Should Do If You Use Avon
- Check the Label: If you have old talc-based powders from several years ago, most experts suggest tossing them. The newer formulations are generally considered safe and meet current regulatory standards.
- Support the Individual, Not the Corp: If you have a local rep you love, buying from them helps their small business. Just be aware that the corporate structure behind them is shifting.
- Watch the Warranty: If you’re buying higher-end items like the Anew skincare line, keep your receipts. Changes in ownership can sometimes mess with return policies or product guarantees.
Moving Forward With Clarity
The story of what happened to Avon is a cautionary tale about failing to move fast enough. It’s about a legacy brand that got hit with the double whammy of a changing retail landscape and a massive legal liability from its past.
For the people who rely on those checks to pay their rent, the bankruptcy is a scary moment. For the rest of us, it’s the end of an era. The "Ding Dong" might not be silenced forever, but the house it’s ringing at is definitely under new management.
If you're looking for alternatives or concerned about the longevity of your favorite products, keep an eye on the LG H&H earnings reports for the U.S. side of things. That's where the real health of the brand in America will be revealed. For the international side, the Delaware court proceedings will dictate if the brand survives into the next decade or becomes a footnote in business history books.
The best move right now? Don't panic, but don't expect the old Avon to come back. The future is digital, talc-free, and likely much smaller than the empire we remember. Focus on the products that actually work for your skin and ignore the corporate noise unless you're an investor. Reality is, the makeup world is too competitive to stay loyal to a brand that's still figuring out its own identity.