Company: FEBO
Filing Date: 2025-05-14
Form Type: 20-F
Source: 0001641172-25-010075
Chunk: 26

Company: Fenbo Holdings Ltd
Filing Date: 2025-05-14
Form: 20-F
Item: Item 3
Chunk 26
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 made on an order-by-order basis. Our business with this customer has been, and
we expect it will continue to be, conducted based on the actual orders received from time to time. Our sole customer is not obligated
in any way to continue placing orders with us at the same or increasing levels, or at all. Our customer’s level of demand for our
products may fluctuate significantly from period to period. Such fluctuation is attributable mainly to changes in our customer’s
business strategies, operational needs and product portfolio, as well as consumer trends. The loss of our sole customer, our inability
to attract new customers or a decrease in our existing customer’s spending on the products we offer or failure to make repeat purchases
of our products, would harm our business, financial condition, results of operations and growth prospects.

  17  

Our sole customer may take actions that
adversely affect our gross profit and operating results

We are dependent upon our one
key customer whose bargaining strength is substantial and growing. We may be negatively affected by changes in their policies, such as
price and term demands, special packaging, shorter lead times for the delivery of products, smaller and more frequent shipments or other
conditions. If we do not effectively respond to these demands, this customer could decrease its purchases from us and a reduction in the
demand for our products or the costs of complying with their business demands could have a material adverse effect on our business, operating
results and financial condition.

Our ability to deliver products to our sole
customer in a timely manner and to satisfy our customer’s fulfillment standards is subject to several factors, some of which are
beyond our control

Our sole customer places great
emphasis on timely delivery of our products for specific selling seasons, especially during our third fiscal quarter, and on the fulfillment
of consumer demand throughout the year. We cannot control all of the various factors that might affect our product delivery. Production
delays, difficulties encountered in shipping from overseas, customs clearance delays and operational issues with any of the third-party
logistics providers we use are on-going risks of our business. Accordingly, we are subject to risks, including labor disputes, inclement
weather, public health crises (such as pandemics and epidemics), natural disasters, possible acts of terrorism, port and canal backlogs
and blockages, availability of shipping containers and increased security restrictions associated with the carriers’ ability to
provide delivery services to meet our shipping needs. These risks have been exacerbated by surges in demand and