Company: DDC
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001213900-25-043916
Chunk: 102

Company: DDC Enterprise Ltd
Filing Date: 2025-05-15
Form: 20-F
Item: Item 5
Chunk 102
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 our own “ DayDayCook” branded product sales and private label product sales. This combined strategy was
prompted by the need to (i) improve our competitiveness in the RTC, RTH, RTE and plant-based meat food sectors, (ii) expand DayDayCook
own-branded in the market by new acquisition with more scope of offline distributors and (iii) improve the overall margin profile
of the business. Sales from RTC, RTH and RTE has increased from 36.1% of our revenue in the year ended December 31, 2023 to 46.2%
of our revenue in the year ended December 31, 2024. This was a result of acquisitions of companies focusing on offline distribution of
both DayDayCook own-branded and private label products, which generated higher net margins. We expect growth for the DayDayCook own-branded
product to outpace private-label product sales. This shift will require us to plan, develop, and successfully execute on multi-channel
sales, marketing, and distribution strategy.

Long-Term Consumer Trends
and Demand - As the China RTC market is expected to benefit from a shift in customer taste and preferences to
convenient cooking and meal options, the RTC market is expected to grow to RMB564.5 billion (US$83.5 billion) by 2026, a CAGR
(2021-2026) of 17.2%. While plant-based products are a nascent Fast-Moving Consumer Goods (“ FMCG”) category in China, there
is significant demand from younger customer segments for plant-based substitutes/alternatives. Demand for food products that are more
environmentally friendly and viable alternatives to/substitutes for traditional protein sources is expected to increase. As a result,
the market for plant-based products is expected to experience a CAGR (2021-2026) of 11.0%. Total revenue is projected to increase from
RMB5.1 billion (US$703.3 million) in 2021 to RMB8.6 billion (US$1.2 billion) in 2026. As a leader in the RTC/RTH space,
given the recent partnership with PFI Foods, a leading China-based alternative meat manufacturer, and a Board of Directors and advisory
network with significant operating and domain expertise, we should be able to identify and pivot to cater to evolving customer trends
and consumption behavior.

Competition - The
food and e-commerce industries in China are highly competitive.