Company: ILAG
Filing Date: 2025-04-28
Form Type: 20-F
Source: 0001641172-25-006445
Chunk: 7

Company: Intelligent Living Application Group Inc.
Filing Date: 2025-04-28
Form: 20-F
Item: Item 3
Chunk 7
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 success. Our brands may suffer if our marketing plans or product initiatives are not successful. The importance of our brands may
increase if competitors offer products with designs and functions similar to ours. Further, our brands may be negatively impacted due
to real or perceived quality issues or if consumers perceive us as being untruthful in our marketing and advertising, even if such perceptions
are not accurate. The failure to maintain high standards for product quality and integrity, including raw materials obtained from suppliers,
or allegations of product quality issues, even if untrue or caused by our raw material suppliers, may reduce demand for our products or
cause production and delivery disruptions. We maintain guidelines and procedures to ensure the quality and integrity of our products.
However, we may be unable to detect or prevent product quality issues, particularly in instances of the attempts to cover up or obscure
deviations from our guidelines and procedures. If any of our products become unfit for use or cause injury, we may have to engage in a
product recall and/or be subject to liability. In addition, if our products have quality issues, we could incur significant expenses related
to the replacement of our products. Damage to our reputation or our brands or loss of consumer confidence in our products for any of these
or other reasons could result in decreased demand for our products and increased costs and our business, financial condition and results
of operations may be materially adversely affected.

   9  

To the extent our customers purchase products
in excess of consumer demand in any period, our sales in a subsequent period may be adversely affected as our customers seek to reduce
their inventory levels.

From time to time, our customers may purchase more
products than they expect to sell during a particular time period. Our customers may grow their inventory in anticipation of, or during,
our promotional events, which typically provide for reduced prices during a specified time or other customer incentives. Our customers
may also grow inventory in anticipation of a price increase for our products, or otherwise over-order our products as a result of overestimating
demand for our products. If a customer increases its inventory during a particular reporting period as a result of a promotional event,
anticipated price increases or otherwise, then sales during the subsequent reporting period may be adversely impacted as our customers
seek to reduce their inventory to customary levels. This effect may be particularly pronounced when the promotional event, price increase
or other event occurs near the end or beginning of a reporting period or when there are changes in the timing of a promotional event,
price increase or similar event, as