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Supply Chain Management
Taihu Snow diligently refines its supply chain management practices in strict accordance with the Bidding Law of the People's Republic of China and relevant laws. This entails a thorough standardization of the entire lifecycle management of supplier engagement, from admission and evaluation to management and exit, while also fostering effective longterm communication with suppliers. Our commitment lies in basing our partnerships on the quality of suppliers' products and services, giving due importance to their contributions towards environmental sustainability, labor rights protection,
and health and safety standards, thus ensuring the long-term prosperity of both parties.
Supplier Lifecycle Management
Admission
We have established criteria for supplier admission, selecting suppliers based on product quality and service while considering their performance in environmental management, compliance, and safety. A rigorous approval process is set for new suppliers, including document review, sample quality assessment, and on-site/remote audits. Only those who meet these stringent standards are included in the Qualified Suppliers List.
Evaluation
Suppliers are categorized into four tiers: A, B, C, and D, with annual assessments to evaluate their performance. These evaluations are conducted using the Supplier Capability Evaluation Form, and classifications are dynamically adjusted based on a range of factors including the quality of goods supplied, process management, environmental practices, safety, and social responsibility. During the reporting period, 11 suppliers were evaluated, achieving a 100% qualification rate.
Management
We employ a tiered management approach and comprehensive supervision over our suppliers, and urge them to promptly rectify any issues identified, which will be documented and monitored in the Supplier Corrective Action Report. Moreover, we designate preferred and alternative suppliers for critical materials, establishing multiple supply channels and safety stock levels to ensure the stability and reliability of our supply chain.
Exit
In cases where a supplier fails to comply with contractual obligations and does not rectify the violation within the specified deadline, or if the supplier is rated 'D' in the comprehensive supply chain evaluation, their qualification as a supplier will be revoked.
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Total number of suppliers: 11
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Suppliers certified under Occupational Health and Safety Management System: 5, accounting for 45%
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Suppliers certified under Environmental Management System: 6, accounting for 55%
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Suppliers certified in other international standards such as OEKO, GRS, and FSC: 9, accounting for 82%
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Industry Collaboration for Mutual Benefit
As a leading enterprise in Suzhou, the "Silk Capital," Taihu Snow leverages its profound expertise in silk products to drive the silk industry forward. We, as a catalyst for industrial development, actively engage in industry association events, sharing experiences and discussing future directions with peers. Meanwhile, we seek collaborative opportunities with universities and research institutions for innovation across boundaries, expanding the industry’s horizons and venture into uncharted territories.
Through diverse industrial collaborations, the Company has absorbed new\ technologies and concepts. In turn, we have shared our expertise and market insights generously, supporting the silk industry's steady progress towards highquality development. This approach also injects fresh vitality and hope into rural revitalization, fully committing our strength to the industrial rejuvenation of the new era.
Case: Cultivating Applied Art Talents Together to Compose a New Chapter of Industry-Case Education Integration
In November 2023, we partnered with Suzhou City College to start the joint cultivation of applicationoriented artistic talents. This collaboration aimed to further enhance the training outcomes of applied art professionals, marking a significant stride in advancing the construction of industry-education-research bases.
Both parties will work together to optimize talent cultivation programs and introduce technological innovation projects. We will also establish the Undergraduate Practical Workstation, and set up both on-campus and off-campus practical training labs, so as to fulfill the requirements for talent training, scientific research, and community service development at the jointly constructed base. The initiative seeks to create an industry-education integration and innovation mechanism centered on the cultivation of talent for the silk industry, which will be led by Taihu Snow and supported by the Design and Art College of Sozhou City University.
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Community charitable contributions: RMB 1.08 million
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Number of volunteer service participations: 50
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Total annual volunteer service hours: 240 hours
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Public Welfare and Charity
The Company is actively exploring philanthropic models that align with societal developments, delivering warmth and care to those in need, demonstrating its corporate citizenship and responsibility. We have consistently engaged in supporting education through charity for many years to sponsor students facing financial challenges. As of the end of 2023, our total donations amounted to RMB 2.14 million. We've also founded a Youth Volunteer Association to inspire young employees to take part in voluntary blood donations and arrange for their involvement in various charitable events on an ad-hoc basis. Additionally, we set up the Spring Silkworm Volunteer Team and the Lei Feng Volunteer Service Station to encourage our employees to actively contribute to educational charities and care for the elderly through volunteering.
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Rural Revitalization
While pursuing its development, Taihu Snow actively responds to the “Rural Revitalization" strategy by deeply engaging with rural communities and sericulture farmers, committed to enriching lives through the silk farming industry, and driving communal prosperity. Leveraging the strengths of a leading silk industry enterprise, the Company has rejuvenated the traditional sericulture industry, charting a path towards shared prosperity that “Emphasizes selfdevelopment, boosts rural communities, embraces confidence, and advances to the global stage.”
Industry Upgrading Fuels Agricultural Innovation and Rural Revitalization
Taihu Snow has adopted a model of "company + farmers + base" to integrate rural surplus labor into park operations, thereby promoting shared prosperity among local farmers. By constructing contiguous, large-scale, modern sericulture greenhouses, a standardized and workshop-based sericulture model has been realized. The participation of Professor Lu in the Small Silkworm Industry Technology Sericulture Project has further standardized the process, leading to an increase in the spring cocoon yield in 2023 compared to previous years. Depending on market conditions, the output value has increased by 13-15%, with a cocoon harvest exceeding ten thousand kilograms
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Taihu Snow's standardized base: 600 acres
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Total cocoon purchases in 2023: 4,183 tons, an increase of 1,183 tons compared to 2022
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Total revitalized mulberry cultivation area: 570,000 acres
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Empowering and Enriching Farmers Through Technology for Long-Term Development
The previous inefficiencies of land, housing, labor, and time wastage due to dispersed small-scale family-based
farming have been fundamentally resolved through the adoption of organized farming mechanized production, intelligent control, and intensive management. This shift has notably enhanced production efficiency and increased per-acre revenue.
The risk of cocoon oversupply for villagers has been eliminated, significantly boosting the enthusiasm for sericulture among the surrounding farmers and expanding sericulture operations. This ensures high-quality cocoon production from the start and advances the growth of the sericulture sector.
