Company: JL
Filing Date: 2025-07-28
Form Type: 20-F
Source: 0001213900-25-068049
Chunk: 50

Company: J-Long Group Ltd
Filing Date: 2025-07-28
Form: 20-F
Item: Item 3
Chunk 50
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Furthermore,
as we plan to continue expanding our product offerings, we expect to include a wide variety of products in our inventory, which will
make it more challenging for us to manage our inventory and logistics effectively. We cannot guarantee that our inventory levels will
be able to meet the demands of our customers, which may adversely affect our sales. If we fail to manage our inventory effectively, we
may be subject to the risk of inventory obsolescence resulting in decline in inventory value, and inventory write-downs or write-offs.
Any of the above may materially and adversely affect our results of operations and financial condition. On the other hand, if we underestimate
demand for our products, or if our suppliers fail to supply materials and products in a timely manner, we may experience inventory shortages,
which might result in diminished customer loyalty and loss in revenue, either of which could harm our business and reputation.

We
are exposed to credit risks of our customers.

We
are exposed to credit risks of our customers. We do not have access to all the information necessary to form a comprehensive view of
our customers’ creditworthiness. The complete financial and operational conditions of customers are not always available to us,
and we may not be in any position to obtain such information. As a result, if any of our major customers experiences financial difficulty
and fails to settle the outstanding amounts due to us in accordance with the agreed credit terms, our working capital position may be
adversely affected.

We
may default on our obligations under our credit facilities.

We
have entered into several banking facilities with banks in Hong Kong, which were guaranteed by the Chairman of the Board of Directors,
Mr. Danny Tze Ching Wong, and the spouse of Mr. Danny Wong and secured by legal charge over properties beneficially owned by
JLHK, Mr. Danny Wong and the spouse of Mr. Danny Wong. A failure to repay any of the indebtedness under our banking facilities
as they become due or to otherwise comply with the covenants contained in any of such agreements could result in an event of default
thereunder. If not cured or waived, an event of default under any of such agreements could enable the lender thereunder to declare all
borrowings outstanding on such debt, together with accrued and unpaid interest and fees, to be due and payable. The lenders could also
elect to foreclose on our assets securing such debt or enforce the repayment obligation against the guarantors. In such an event, we
may not be able to pay