Company: DDC
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001213900-25-043916
Chunk: 3

Company: DDC Enterprise Ltd
Filing Date: 2025-05-15
Form: 20-F
Item: Item 3
Chunk 3
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 manner, and (iii) develop an effective sales network
accordingly.

Although we dedicate resources
to consumer-centric market research and data analysis to upgrade our existing products and to develop, design and launch new products,
in order to cater to consumer preferences, we cannot assure you that our product portfolio will continuously lead or capture the market
trends. Any changes in consumer preferences and tastes, or any of our failure to anticipate, identify or adapt to market trends, may impose
downward pressure on sales and pricing of our products or lead to increases in selling and distribution expenses, and therefore materially
and adversely affect our business and results of operations.

In order to promptly respond
to rapidly developing market trends and changing tastes, preferences and lifestyle of consumers, our sales and development teams regularly
observe the changing trends in our target markets and launch new products or different serving sizes and flavors from time to time. While
we have in the past successfully developed, promoted and achieved market acceptance of our products, we cannot assure you that we will
be able to continuously develop new products or our existing or new products in the future will continue to generate sufficient consumer
demand to be profitable.

If we fail to retain existing customers,
derive revenue from existing customers consistent with historical performance or acquire new customers cost-effectively, our business
could be adversely affected.

Our ability to increase revenues
depends in part on our ability to retain and keep existing customers engaged so that they continue to purchase products from us, and to
acquire new customers cost-effectively. We intend to continue to expand our number of customers as part of our growth strategy. If we
fail to retain existing customers and to attract and retain new customers, our business, financial condition and results of our operations
could be adversely affected.

Further, if customers do not
perceive our product offerings to be of sufficient value, quality, or innovation, or if we fail to offer innovative and relevant product
offerings, we may not be able to attract or retain customers or engage existing customers so that they continue to purchase products or
increase the amount of products purchased from us. We may lose current customers to competitors if the competitors offer superior products
or if we are unable to satisfy its customers’ orders in a timely manner.

The market for ready-to-heat (“ RTH”),
ready-to-cook (“ RTC”), ready-to-eat (“ RTE”) and plant-based meal products in China and the United States
is continuously evolving and may not grow as quickly as expected, or at all, which