Company: FGI
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001628280-25-015656
Chunk: 29

Company: FGI Industries Ltd.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 1A
Chunk 29
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Table of Contents

ITEM 1A.           RISK FACTORS

Our business is subject to numerous risks. You should carefully consider the following risks and all other information contained in this Annual Report, as well as general economic and business risks, together with any other documents we file with the SEC. If any of the following events actually occur or risks actually materialize, it could have a material adverse effect on our business, operating results and financial condition and cause the trading price of our ordinary shares to decline.

INDEX TO RISK FACTORS

Strategic Risks13Business and Operational Risks15Risks Related to Doing Business in China19Competitive Risks21Technology and Intellectual Property Risks23Litigation and Regulatory Risks24Risks Related to Our Securities26General Risk Factors29

Strategic Risks

Our BPC organic growth strategy is focused on capturing higher incremental gross margins by increasing our share of branded products, expanding into new product categories and creating new sales channels, all of which are impacted by a number of economic factors and other factors.

Our business relies on residential repair and remodel (“R&R”) activity and, to a lesser extent, on new home and commercial construction activity. A number of factors impact consumers’ spending on home improvement projects as well as new home construction activity, including:

•consumer confidence levels;

•fluctuations in home prices;

•existing home sales;

•inflationary pressures and interest rates;

•unemployment and underemployment levels;

•consumer income and debt levels;

•household formation;

•the availability of skilled tradespeople for R&R work;

•the availability of home equity loans and mortgages and the interest rates for and tax deductibility of such loans;

•trends in lifestyle and housing design; and

•natural disasters, terrorist acts, pandemics, wars or conflicts or other catastrophic events.

The fundamentals driving our business are impacted by economic cycles, and we have been negatively impacted by recent supply chain disruptions, rising interest rates and inflationary pressures. Adverse changes or uncertainty involving the factors listed above or an economic contraction in the United States and worldwide could result in a decline in spending on residential R&R activity and a decline in demand for new home construction and could adversely impact our businesses by: causing consumers to delay or decrease homeownership; making consumers more price conscious resulting in a shift in demand to smaller, less expensive homes; making consumers more reluctant to make investments in their existing homes, including large kitchen and bath R&R projects; or making it more difficult or expensive to secure