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
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
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
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.