Company: DDC
Filing Date: 2025-01-28
Form Type: 20-F
Source: 0001213900-25-007160
Chunk: 226

Company: DDC Enterprise Ltd
Filing Date: 2025-01-28
Form: 20-F
Item: Item 19
Chunk 226
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of products:

  (a)      Own-branded ready to cook (“ RTC”) products that can be consumed within 15-20 minutes with additional cooking preparation required;  

  (b)      Own-branded ready to heat (“ RTH”) products, typically pre-or-semi-cooked meals, which require some preparation ahead of serving;  

  (c)      Ready to eat & plant base products (“ RTE & Plant Base”) — typically pre-cooked meals that are ready to serve with minimal level of additional preparation, which includes the plant-based meal p...  

  (d)      Private label products with other third-party brand; and  

  (e)      Fresh products including fresh and organic vegetables and fruit. The Company no longer had this category following the deconsolidation of Farm Entities since April 1, 2022.  
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Each type of the products is distributed and promoted
through omni channels (online and offline).

1) Online consumer
product sales

The Company sells RTC, RTH, RTE & Plant Base
and private label products to individual customers or small retailers through third-party E-commerce platforms. Revenues for online consumer
products are recognized on a gross basis as the Company obtains control of the products before they are delivered to the customers.

F-37

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES(cont.)

When the Company sells RTC, RTH, RTE & Plant
Base and private label products through third-party E-commerce platforms, the Company sets up online stores on platforms to sell the product
to these individual customers or small retailers. These platforms provide services to support the operations of the online stores including
processing sales orders and collecting payment from individual customers or small retailers. These platforms charge service fees based
on the sales conducted through the online stores. The Company enters into sale contracts directly with individual customers or small retailers.
These platforms do not take control of the goods or have sales contracts with individual customers or small retailers. The Company is
responsible for fulfilling all obligations according to the sales contracts with end customers and small retailers, including delivering
products, providing customer support and handling sales return. The Company also has discretion in setting the price charged on individual
customers or small retailers. Accordingly, the Company determined that individual customers and small retailers (as opposed to the platforms)
are the Company’s customers. The sales contracts with individual customers normally include a customer