Company: KPEA
Filing Date: 2025-01-14
Form Type: 10-K
Source: 0001493152-25-002124
Chunk: 654

Company: Kun Peng International Ltd.
Filing Date: 2025-01-14
Form: 10-K
Item: Item 1A
Chunk 654
---
 In order to
fund our ongoing operations and our future growth, we need to have sufficient internal sources of liquidity or access to additional financing
from external sources. Furthermore, our management will be required to maintain and strengthen our relationships with our customers and
other third parties. Currently, we only have 34 full time employees. As a result, our continued expansion has placed, and will continue
to place, significant strains on our management personnel, systems, and resources. We also will need to further strengthen our internal
control and compliance functions to ensure that we will be able to comply with our legal and contractual obligations and minimize our
operational and compliance risks. Our current and planned operations, personnel, systems, internal procedures, and controls may not be
adequate to support our future growth. If we are unable to manage our growth effectively, we may not be able to take advantage of market
opportunities, execute our business strategies, or respond to competitive pressures.

50

A
recurrence of COVID-19 may cause delays or limit our ability to expand our business.

The
COVID-19 pandemic resulted in quarantines, travel restrictions, limitations on social or public gatherings, and the temporary closure
of business venues and facilities around the world. Due to restrictions, quarantines, and closures in certain affected areas and government
agencies in the PRC, the approval process of our applications for construction permits for Smart Kiosks was delayed by the local governmental
agencies and our Smart Kiosk project has been abandoned, which impacts our plan of enhancing our face-to-face customer services and increasing
our market share. The Company continues to focus its business on its online platform, King Eagle Mall, and to promote its own brand of
consumer health care and health-related household products on its new online platform, Kun Zhi Jian, which was introduced and implemented
in October 2022, to mitigate the adverse impacts of COVID-19. The Company has also launched the Kun Zhi Jian Mini Program, which consists
of three components: physiotherapy equipment, a customer service center, and a shopping mall.

Therefore,
we do not expect that the virus will have a material adverse effect on our business or financial results at this time. However, it is
not possible to predict the unanticipated consequence of the pandemic on our future business performance and liquidity if it should arise
again in Asia. The Company continues to monitor and assess the evolving situation closely and evaluate its potential exposure.

We
will rely on dividends and other