Company: ZRCN
Filing Date: 2025-09-10
Form Type: 10-K
Source: 0001641172-25-027037
Chunk: 118

Company: ZRCN Inc.
Filing Date: 2025-09-10
Form: 10-K
Item: Item 1
Chunk 118
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 competitiveness, seeking patent and intellectual property protections in key markets
and legally asserting our intellectual property rights when we believe that our rights have been violated. These efforts have proven
effective for us historically, but there is no guarantee that our technology, R&D or that our efforts to protect our intellectual
property will be wholly successful in every instance going forward. Should efforts prove unsuccessful or insufficient, our technology
may not be able to maintain our current level of market competitiveness.

The
market for our products is highly price sensitive and subject to change with market conditions.

The
United States represents our primary market. The US consumer retail market is a highly competitive market characterized by aggressive
price competition and potential downward pressure on gross margins. The hand tool industry is not typically characterized by frequent
introduction of new products with short product life cycles. Although customers and retailers often seek new product ideas, the industry
is not known for rapid adoption of technological advancements. New product ideas often take a year or two to be phased into the Plan-o-gram
and onto the retailers’ walls. The electronic tool category has had more innovation than most tools and consequently, more competition
has emerged.

Our
ability to compete successfully depends heavily on ensuring the continuing and timely introduction of innovative new products to the
marketplace. We design and develop our products. As a result, we must make significant investments in R&D. There can be no assurance
these investments will achieve the expected returns, and we may not be able to develop and market new products successfully. If we are
unable to continue to develop and sell innovative new products with attractive margins, our ability to maintain a competitive advantage
could be adversely affected.

We
are responsible for creating the electronic wall scanning product category and have over 40 years of experience developing and marketing
such tools. Nevertheless, we face substantial competition from companies that have significant technical, marketing, distribution, and
other resources. In addition, some of our competitors have broader product lines, lower-priced products, a larger client base, and a
longer operating history. Certain competitors have the resources, experience, or cost structures to provide products at little or no
profit or even at a loss.

Our
business, results of operations and financial condition will depend on our ability to continually improve our products to maintain their
functional and design advantages. There can be no assurance we will be able to continue to provide products that compete effectively.

Business
Risks

To
remain competitive and stimulate customer demand, we must successfully manage frequent introductions and