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Email This Print This Location : Home -> Investor Relations -> Corporate Information -> Competitive Strengths

We have identified the following key competitive strengths that contribute to our ability to compete in our business:-

We Place Strong Emphasis On Research and Development
We place strong emphasis on research and development. In FY2002, FY2003, FY2004 and FP2005, our investment on research and development facilities and expenses on research and development amounted to approximately RMB 1.6 million, RMB 4.2 million, RMB 6.1 million and RMB 1.4 million respectively. Our research and development focuses on developing a wide variety of products with desired characteristics, and improving our production processes as well as the quality of our existing products. We possess sophisticated and advanced equipment to boost our research and development capabilities. We also collaborate with various government and non-government institutions, including universities and research institutes in our research and development. We also tap on external expertise by appointing specialists from the PRC and overseas (such as Japan and Germany) as our consultants to impart their knowledge and skills to improve our product variety and quality, and our production process.

Through our research and development efforts, we have developed various products that have become widely accepted amongst our customers. Also, some of our products were awarded "New Product New Technology" and "Science and Technology Result Identification" certifications in recognition of the quality and advancements in our new products and production processes. In addition, CFIA established a CFIA Starch Sugar Quality Test Centre at our research and development centre premises and authorised us to conduct quality checks and issue quality reports or certificates that are recognised in the PRC, when requested by third parties to verify and certify the quality standards of their sweeteners or other related products.

With access to knowledge and support from our tie-ups with research institutes and experts in our industry, complemented by the research and development technological capabilities that we possess, we believe that we are well-positioned to compete with our competitors.

We Produce High Quality Products and Offer Quality After-Sales Service
We adhere to stringent quality assurance guidelines. From sourcing and production to the delivery of our finished products, we adopt various measures to perform quality checks on our products at every stage of our production workflow to ensure that our products conform to PRC quality standards. We also utilise advanced quality testing equipment to assist in the conduct of our tests. Our commitment to quality is evidenced by a series of accreditations and certifications such as the ISO9001:2000, ISO14001:1996, Halal and Star-K Kosher. Our quality control measures also adhere to the stringent quality control standards of HACCP. This ensures that all our products are of a high quality and are safe for consumption.

In addition to product quality, we place great emphasis on our after-sales service and customer support. We have an information helpdesk to assist our customers in their queries and if required, send our staff to our customers' premises to provide assistance. We normally grant a warranty period for our products where we will replace free of charge any products with defects to our customers within such period. We also maintain regular contact with our customers to understand their business needs and to maintain good business relationships.

We have strong product brand names

We have over the years built up goodwill in our brand names, especially our "鲁洲" brand name and trade mark through our commitment to product and service quality to our customers. As a result of this, our brand names have become widely recognised by our customers in many parts of the PRC and some other countries. Our customers have confidence in our brands and are assured of product quality. In June 2003 and August 2002, we were awarded the "山东名牌" (Shandong Famous Brand) and "山东省著名商标" (Shandong Notable Trade Mark) respectively, recognising "鲁洲" as a notable brand and trade mark in the Shandong Province. When we launch new products, we may leverage on our branding and sell these products under our existing brand names. Our established brand names allow us to sell our products more effectively.

We Have An Experienced Management Team

Our management team is led by our Managing Director, Niu Ji Xing, and our Executive Directors, Gao Zhong Fa and Wang De You, each of whom has at least 10 years of experience in our industry and business. They possess in-depth knowledge of our business and industry, and understand our customers' needs and requirements. We are also supported by our Executive Officers and a dedicated and dynamic team of staff who have qualified knowledge and expertise in running our day-to-day operations.

We Have A Wide Sales and Distribution Network

Our products are also sold through a wide sales and distribution network of 11 sales offices under our subsidiaries in Shandong, Liaoning and Shaanxi and sales staff stationed in 14 different locations across the PRC. Our sales and distribution network in the PRC is strategically located in different regions to provide us with wide distribution coverage and reach. At the locations where we have stationed our sales staff, we have also rented storage warehouses for our finished products that are pending delivery to our customers within their respective areas of coverage. This enables us to respond to our customers' needs within a shorter time.

Our Production Facilities Are Strategically Located Near The Source of Our Key Raw Material

Our production facilities are strategically located in proximity to the Songliao Plains in Liaoning, Qinchuan Plains in Shaanxi, Huanghuai Plains in Shandong and Yuzhong Plains in Henan, areas that are widely known for the cultivation and harvesting of corn and their abundance in natural resources. Given the close proximity to corn, our key raw material, and natural resources, we are able to enjoy a stable supply of raw materials and natural resources that are competitively priced and of good quality. This reduces our exposure to risk of shortage in raw material supply and lack of natural resources. We are also able to benefit from the lower transportation costs as a result of our proximity to our sources of raw materials.

Our Subsidiaries Are Accredited With The Provincial Level Agriculture Industry Key Flagship Company Status

In recognition to our success in the industry, our subsidiaries have been accredited with the Provincial Level Agriculture Industry Key Flagship Company status. The Provincial Level Agriculture Industry Key Flagship Company status is an official accreditation given by the government, recognising us as a successful and reliable enterprise, and a leader in our industry. Receiving the Provincial Level Agriculture Industry Key Flagship Company status has enhanced our corporate image and benefited us in many ways such as preferential rates for property purchase, lower interest rates for bank loans and taxation relief. This will continue to give us a competitive edge over our competitors.

We Utilise ERP To Enhance Business Operations Efficiency

We have been utilising an ERP software developed by SAP since July 2004. The introduction of the ERP software has integrated the key functions of our Group, enabling us to better monitor and manage the business operations and resources of our Group as a whole and each of our subsidiaries individually. The benefits we have gained from the ERP software include enhanced business productivity and efficiency, reduced costs, better product competitiveness and more stable business development. We believe that the ERP software, will continue to add value to our business operations and give us a competitive edge over competitors without such management software.

We Have Our Own Power Generating Capabilities and Water Resources

Due to the large amounts of electricity and water required for the manufacture of our products, our Yishui production facility contains electricity generating equipment and water resources, while our Fushun, Xingping and Xiping production facilities contain water resources. In all our production facilities, we are equipped with water wells that accumulate ground water.We utilise the well water solely for the manufacture of our products. In our Yishui production facility, we possess a 6MW thermoelectricity generator that is capable of producing electricity to boost production capacity. In our Fushun and Xingping production facilities, we have thermoelectricity boilers and basic facilities that are used to generate steam required for our production process and we plan to complete the construction of full-fledged thermoelectricity generators similar to that in our Yishui production facility. With power generating capabilities and water resources, we are able to pre-empt possible utilities disruptions from local utility companies, boost our production capabilities and most importantly, benefit from lower expenses as our utility costs will be reduced. This gives us a competitive edge over our competitors who are still reliant on utility companies for power and not able to capitalise on lower utility expenses.