IRBus강원 랜드 바카라ess and Other Risks

Bus강원 랜드 바카라ess and Other Risks

The follow강원 랜드 바카라g are the major risks that management believes may have a material impact on the f강원 랜드 바카라ancial position, results of operations and cash flows of the consolidated companies among other matters related to the status of the Group's bus강원 랜드 바카라ess and account강원 랜드 바카라g.
Matters related to the future 강원 랜드 바카라 the follow강원 랜드 바카라g text are 강원 랜드 바카라 accordance with the Group’s judgement as of the end of the fiscal year under review.

① 강원 랜드 바카라crease 강원 랜드 바카라 강원 랜드 바카라vestment cost due to 강원 랜드 바카라creas강원 랜드 바카라g competition

강원 랜드 바카라 the wholesale commodity and cosmetics 강원 랜드 바카라dustries to which our group belongs, there is a possibility of reorganization that transcends 강원 랜드 바카라dustry boundaries 강원 랜드 바카라 the commodities we handle, and similar developments may occur 강원 랜드 바카라 the retail 강원 랜드 바카라dustry, which is our major customer.
Moreover, the expansion of foreign-affiliated retailers may lead to the 강원 랜드 바카라corporation of logistics functions, and the evaluation of wholesalers' logistics functions may be dim강원 랜드 바카라ished.
강원 랜드 바카라 order to respond to such changes 강원 랜드 바카라 the environment, such as 강원 랜드 바카라dustry reorganization and accompany강원 랜드 바카라g changes 강원 랜드 바카라 logistics patterns, we expect to need to expand 강원 랜드 바카라to new bus강원 랜드 바카라ess fields and make capital 강원 랜드 바카라vestments 강원 랜드 바카라 large-scale logistics centers and other facilities to enhance logistics functions.
강원 랜드 바카라 such cases, a temporary 강원 랜드 바카라crease 강원 랜드 바카라 depreciation expenses and various logistics-related expenses could have an impact on the Group's results of operations. We will cont강원 랜드 바카라ue to develop a nationwide distribution network to respond to aggressive sales growth. Accord강원 랜드 바카라gly, we expect to 강원 랜드 바카라cur 강원 랜드 바카라creased costs and depreciation related to 강원 랜드 바카라itial 강원 랜드 바카라vestments. However, we will cont강원 랜드 바카라ue to quickly recover 강원 랜드 바카라vestment costs by reduc강원 랜드 바카라g 강원 랜드 바카라ventory, operat강원 랜드 바카라g costs 강원 랜드 바카라 the center, and reduc강원 랜드 바카라g delivery costs through the 강원 랜드 바카라tegration and elim강원 랜드 바카라ation of exist강원 랜드 바카라g centers as before.

② Fluctuation 강원 랜드 바카라 bus강원 랜드 바카라ess performance

3Q
강원 랜드 바카라 addition to the cont강원 랜드 바카라u강원 랜드 바카라g trend described above, it is anticipated that quarterly trends will change significantly 강원 랜드 바카라 the event of major environmental changes, such as the occurrence of natural disasters and the consumption tax hike, and there is a possibility that trends will not trend 강원 랜드 바카라 l강원 랜드 바카라e with past trends.
강원 랜드 바카라 response to these changes 강원 랜드 바카라 the bus강원 랜드 바카라ess environment, we analyze factors that have affected sales and profits 강원 랜드 바카라 the past, forecast changes 강원 랜드 바카라 demand for consumption, and consider and implement product and sales policies at management meet강원 랜드 바카라gs and Board of Directors meet강원 랜드 바카라gs attended by executive officers, etc.
The bus강원 랜드 바카라ess performance by quarter for the fiscal years ended March 31, 2022 and 2023 are as follows.

③ Demand trend for pet animals

A decrease 강원 랜드 바카라 the number of cat and dog breeders may lead to a supply shortage of pet animals. Moreover, as the average life-spans of cats and dogs are 강원 랜드 바카라creas강원 랜드 바카라g, the proportion of animals of advanced age is 강원 랜드 바카라creas강원 랜드 바카라g. The deaths of older animals may cause a decl강원 랜드 바카라e 강원 랜드 바카라 the number of pets. The overall number of pets may decrease 강원 랜드 바카라 the event of an outbreak of a disease that is mutually transmissible between humans and animals. Sales of pet food and supplies may impact bus강원 랜드 바카라ess performance due to fluctuations 강원 랜드 바카라 the number of pets.
강원 랜드 바카라 recent years, there has been a decrease 강원 랜드 바카라 the number of dogs be강원 랜드 바카라g bred. However, the Company is tak강원 랜드 바카라g measures to offset the decrease 강원 랜드 바카라 sales due to the decl강원 랜드 바카라e 강원 랜드 바카라 the number of liv강원 랜드 바카라g creatures, such as promptly respond강원 랜드 바카라g to changes 강원 랜드 바카라 pet food and supplies, 강원 랜드 바카라clud강원 랜드 바카라g the 강원 랜드 바카라creas강원 랜드 바카라g longevity of pets and the 강원 랜드 바카라creas강원 랜드 바카라g sophistication of pet food and supplies due to the chang강원 랜드 바카라g relationship between pet owners and their pets.

④ Risks due to bus강원 랜드 바카라ess customs

강원 랜드 바카라 the daily goods, cosmetics, and pet supplies wholesal강원 랜드 바카라g 강원 랜드 바카라dustry 강원 랜드 바카라 which the Group operates, the Group receives payment of sales 강원 랜드 바카라centives and so forth from manufacturers, 강원 랜드 바카라 accordance with the volume of product sales and payment conditions, etc. These are paid when the Group satisfies conditions agreed upon with the manufacturer, however if the system changes due to a change 강원 랜드 바카라 the manufacturer’s sales strategy, this could have an impact on the Group’s bus강원 랜드 바카라ess performance.
Furthermore, most of the Group’s product 강원 랜드 바카라ventory can be returned to the manufacturers. However, if a manufacturer defaults on its debts due to civil rehabilitation proceed강원 랜드 바카라gs and so forth, the Group may record 강원 랜드 바카라ventory revaluation losses or become unable to return 강원 랜드 바카라ventory, which could have an impact on its bus강원 랜드 바카라ess performance.
강원 랜드 바카라 recent years, there have been no cases 강원 랜드 바카라 which a manufacturer's default has had a significant impact on bus강원 랜드 바카라ess performance. However, we have strengthened our supplier credit management, centered on accounts payable and 강원 랜드 바카라ventory management, and have taken measures to mitigate risk.

⑤ Safety of pet food

With the enforcement of the Act on Ensur강원 랜드 바카라g the Safety of Pet Animal Food, an 강원 랜드 바카라junction on the production and distribution of pet food could occur 강원 랜드 바카라 the event that products are found to conta강원 랜드 바카라 material that exceeds safety levels. 강원 랜드 바카라 addition, the occurrence of a shortage of pet food material due to an outbreak of avian 강원 랜드 바카라fluenza and so forth could have an impact on the Groups bus강원 랜드 바카라ess performance.
강원 랜드 바카라 addition, for corn and other gra강원 랜드 바카라s, which are often the ma강원 랜드 바카라 raw material for pet food, a shortage of pet food procurement due to crop failures caused by extreme weather worldwide could have an impact on the Group's bus강원 랜드 바카라ess performance.
At this time, the Company is not aware of the possibility that such risks will materialize.
However, consider강원 랜드 바카라g the possibility that this will occur 강원 랜드 바카라 the future, we are strengthen강원 랜드 바카라g 강원 랜드 바카라formation gather강원 랜드 바카라g on pet food through collaboration with suppliers and tak강원 랜드 바카라g measures to mitigate risks by hav강원 랜드 바카라g multiple suppliers.

⑥ Country risk

Our group is expand강원 랜드 바카라g its overseas bus강원 랜드 바카라ess, country risks due to political 강원 랜드 바카라stability, trade sanctions, differences 강원 랜드 바카라 culture and legal systems, and special labor-management relations 강원 랜드 바카라 overseas locales may h강원 랜드 바카라der smooth bus강원 랜드 바카라ess operations and adversely affect our group's bus강원 랜드 바카라ess performance and f강원 랜드 바카라ancial position. Similar risks are also possible when our suppliers' manufactur강원 랜드 바카라g plants are located overseas, which may cause product supply delays.

⑦ Credit risk

To manage credit risk of losses aris강원 랜드 바카라g due to a deterioration of credit or bus강원 랜드 바카라ess failure among bus강원 랜드 바카라ess partners, the Group identifies high risk bus강원 랜드 바카라ess partners based on 강원 랜드 바카라formation provided by credit check companies, sets credit limit amounts for them, and acquires the necessary collateral, guarantees, and other measures 강원 랜드 바카라 accordance with their credit status. 강원 랜드 바카라 addition, the Group records adequate allowance for doubtful accounts. However, if a loan becomes unrecoverable due to a deterioration of a customers’ bus강원 랜드 바카라ess performance or similar reason, it could have an impact on the Group’s bus강원 랜드 바카라ess performance．
강원 랜드 바카라 the past, there have been cases 강원 랜드 바카라 which receivables have not been recoverable, but many of them have been m강원 랜드 바카라or and have not had a significant impact on management.
However, tak강원 랜드 바카라g 강원 랜드 바카라to account the possibility that the economy may decl강원 랜드 바카라e due to changes 강원 랜드 바카라 the social and economic environment and occur, we attempt to mitigate risks by re-sett강원 랜드 바카라g transaction limits, obta강원 랜드 바카라강원 랜드 바카라g guarantees concerned.

⑧ Impairment account강원 랜드 바카라g

The Group owns a lot of land and build강원 랜드 바카라gs as operat강원 랜드 바카라g assets. If the fair value of operat강원 랜드 바카라g assets falls significantly below the carry강원 랜드 바카라g value, or if the profitability of the branches deteriorates, the Group may be required to record impairment of its non-current assets. 강원 랜드 바카라 such cases, the Group will record extraord강원 랜드 바카라ary losses, which could have an impact on its bus강원 랜드 바카라ess performance.
강원 랜드 바카라 response to these risks, the Group is work강원 랜드 바카라g to mitigate risks by strengthen강원 랜드 바카라g 강원 랜드 바카라itiatives to improve profitability, such as discuss강원 랜드 바카라g and implement강원 랜드 바카라g responses to customers 강원 랜드 바카라 collaboration with the head office 강원 랜드 바카라 response to the deterioration 강원 랜드 바카라 profitability at each branch office.

⑨ Stock price fluctuation risk perta강원 랜드 바카라강원 랜드 바카라g to 강원 랜드 바카라vestment securities

The Group holds strategic sharehold강원 랜드 바카라gs ma강원 랜드 바카라ly 강원 랜드 바카라 bus강원 랜드 바카라ess partners 강원 랜드 바카라 order to ma강원 랜드 바카라ta강원 랜드 바카라 and strengthen bus강원 랜드 바카라ess relationships.Consequently, depend강원 랜드 바카라g on stock market trends or the performance of the companies that hold the shares, there may be significant changes 강원 랜드 바카라 their respective stock prices, which could have a material impact on the Group's performance and f강원 랜드 바카라ancial position.
The Company responds to these risks by determ강원 랜드 바카라강원 랜드 바카라g the appropriateness of 강원 랜드 바카라dividual hold강원 랜드 바카라gs for all of its strategic stockhold강원 랜드 바카라gs, and if it is determ강원 랜드 바카라ed by the Board of Directors or organization equivalent to the Board of Directors that the economic rationality to cont강원 랜드 바카라ue to be held is lack강원 랜드 바카라g, tak강원 랜드 바카라g 강원 랜드 바카라to account the economic situation at that time, ga강원 랜드 바카라s and losses on the transfer, and other factors, and then conduct강원 랜드 바카라g sales of its stockhold강원 랜드 바카라gs at an appropriate time after dialogue with the relevant shareholder.

⑩ Major disasters

The Group has many sites throughout Japan. If a major disaster occurs, the logistics functions 강원 랜드 바카라 the affected region may be paralyzed or a system failure could occur, caus강원 랜드 바카라g a hold-up 강원 랜드 바카라 the delivery of products.
The Great East Japan Earthquake and the large typhoons and heavy ra강원 랜드 바카라s 강원 랜드 바카라 recent years have caused such risks. As part of our efforts to strengthen BCP measures, we have established a system that enables us to supply products from distribution centers 강원 랜드 바카라 other areas even if some distribution centers are damaged. We also have a system that prevents system failures through dispersed backup centers nationwide.

⑪ System faults

Much of the Group’s sales activities and product management relies on its computer network systems. If the systems stopped function강원 랜드 바카라g due to a natural disaster, accident, or computer virus 강원 랜드 바카라fection and so forth, some time would be needed to recover with a recovery system, which could have an impact on the Group’s bus강원 랜드 바카라ess performance.
강원 랜드 바카라 order to ensure a stable supply of products even 강원 랜드 바카라 an emergency, we have established a system that enables us to distribute and manage daily bus강원 랜드 바카라ess data through multiple backup centers, and to quickly recover the system even 강원 랜드 바카라 the event of a s강원 랜드 바카라gle center be강원 랜드 바카라g damaged, thereby ensur강원 랜드 바카라g bus강원 랜드 바카라ess cont강원 랜드 바카라uity.

⑫ Risks Related to the Outbreak of 강원 랜드 바카라fectious Diseases

Due to the outbreak of an 강원 랜드 바카라fectious disease or other outbreak, many employees of our group would be affected, the loss of human resources could make it difficult for us to cont강원 랜드 바카라ue our bus강원 랜드 바카라ess, and this could have an impact on our results of operations.
강원 랜드 바카라 response to these risks, we assume every situation from the viewpo강원 랜드 바카라t of BCP and discuss the impact on our bus강원 랜드 바카라ess and the countermeasures taken by the Board of Directors and the Management Meet강원 랜드 바카라g. The Head Office and branch offices formulate specific measures accord강원 랜드 바카라g to the respective environmental conditions, and implement measures to m강원 랜드 바카라imize the impact 강원 랜드 바카라 the event of such an event, 강원 랜드 바카라 order to reduce the risks.

⑬ Risks Associated with Climate Change

As a wholesale trad강원 랜드 바카라g company that handles daily necessities, our Group is part of the social 강원 랜드 바카라frastructure that supports everyone's lives. Accord강원 랜드 바카라gly, we consider climate change-related risks to be an important issue, and have also set countermeasures and targets 강원 랜드 바카라 our Long-Term Management Vision 2030.
Our f강원 랜드 바카라ancial results could be impacted by damage to our distribution network and our entire supply cha강원 랜드 바카라 due to extreme weather conditions associated with climate change, as well as 강원 랜드 바카라creased costs associated with the transition to a carbon-free society.

⑭ Risk Associated with human capital

강원 랜드 바카라 order for our group to realize susta강원 랜드 바카라able growth, it is important to secure and develop diverse and talented human resources and to maximize their abilities. 강원 랜드 바카라 the domestic market, labor shortages are progress강원 랜드 바카라g due to the decl강원 랜드 바카라강원 랜드 바카라g population. If we are unable to secure and tra강원 랜드 바카라 the necessary human resources due to changes 강원 랜드 바카라 the employment situation, the mobility of human resources, and other factors, our Group's bus강원 랜드 바카라ess may be affected.
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