• Long history and reputation for quality products at competitive prices led to the “Sheng Siong” brand name becoming an established brand name in Singapore

Dedicated key management personnel with extensive experience

• Experienced key management team with decades of hands-on experience and in-depth knowledge of the grocery retailing industry

Offering of quality products at competitive prices

• Place great importance on product quality via strict selection of suppliers and quality checks upon the receipt of the products
• Ability to price products competitively and pass on the benefits to consumers through:
  • Centrally-controlled purchases and economies of scale via bulk purchases
  • Direct procurement from suppliers and contract manufacturers, bypassing the intermediaries and associated costs
  • Launch of 10 housebrands which are typically priced lower than comparable international or national brands

Established relationships with suppliers and contract manufacturers

• Established a large network of over 1,000 suppliers and contract manufacturers* and some of these business dealings were formed since 1985

Catering to the needs of customers with a wide product range and extended operating hours

• Extensive knowledge of Singapore’s consumer preferences and consumption patterns enables us to cater to the daily needs of customers by providing a
  • wide selection of quality products; and
  • selection of certain food products including spices, sauces, noodles and canned foods which we believe are not commonly found in our competitors’ stores
• Each of our stores is open between 15 to 16 hours a day, enabling our customers to purchase groceries and other household necessities at their convenience

Centralised logistics and distribution centre

• Maintain centralised warehouse and distribution centre to meet the stores’ logistical demands Computerised systems facilitate efficient operations
• Computerised systems (including the Management Information System)

* Latest Practicable Date as at 24 June 2011

Our corporate headquarters is currently located at our Mandai Link Distribution Centre and it houses our central administrative, finance, human resource and marketing departments. Construction of our new corporate headquarters and distribution centre at Mandai Link was completed in May 2011, at an estimated cost of up to S$65 million. As at the Latest Practicable Date*, approximately S$49.5 million had been spent on construction costs and approximately S$8.1 million had been spent on land costs. The Mandai Link Distribution Centre was partly financed by the Term Loan and by cash from our Group.

* Latest Practicable Date as at 24 June 2011

Our Mandai Link Distribution Centre will increase our operational efficiency and productive capacity by enabling us to warehouse, process and distribute proportionately larger quantities of goods and benefit from economies of scale in terms of manpower, transportation and fuel costs.

Expand store network

• Continue increasing the number of our stores to enhance economies of scale and further capitalize on our Group’s existing infrastructure
• May open new stores either in Singapore or overseas and may also consider expanding through acquisitions

New Mandai Link Distribution Centre

• Warehouse, process and distribute proportionately larger quantities of goods, and thus benefit from economies of scale in terms of manpower, transportation and fuel costs

Increase productivity, economies of scale, quality and profitability

• Continue to upgrade our computer network systems, including our Management Information System
• Continue to capitalise on our Group’s economies of scale, as well as the strong and well-established relationships we have built over the years with our suppliers and contract manufacturers
• Increase our purchases direct from product sources, in order to eliminate middlemen expenses and reduce costs, as well as to increase our control over the quality and freshness of the products we retail

Expand selection of housebrands and housebrand products

• Strengthen relationships with our existing contract manufacturers to secure more favourable terms and prices
• Establish relationships with new contract manufacturers to increase selection and types of housebrand products

• Stable business with strong cash flow
• Established & distinctive brand name
• Singapore’s third largest grocery retail chain*
• New distribution centre to improve operational efficiency
• Dividends: Up to 90% of our net profit after tax FY2011 and FY2012

IMPORTANT NOTE:
This answers to the question in this segment is made in reliance on Section 251(8) of the Securities and Futures Act, Chapter 289 of Singapore, and does not constitute an offer, invitation or solicitation to subscribe for the shares in Sheng Siong (the “Sheng Siong Shares”) in Singapore or any other jurisdiction nor should it or any part of it form the basis of, or be relied upon in any connection with, any contract or commitment whatsoever. Any decision to purchase the Sheng Siong Shares should be made solely on the basis of information contained in the Prospectus and no reliance should be placed on any information other than that contained in the Prospectus.