Sales Model - The company reported a revenue of 765 million yuan, representing a year-on-year increase of 15.31%, with a higher gross profit margin from distribution sales compared to direct sales [1] - The sales model has shifted significantly from "mainly direct sales, supplemented by distribution" at the time of listing in 2020 [1] Revenue Recognition - The company needs to clarify the sales situation of its top five distribution customers, including names, cooperation duration, and sales amounts, along with reasons for changes [2] - Revenue recognition for the top five distribution customers is based on the timing of sales and compliance with industry practices and accounting standards [2][6] - The gross profit margin for distribution sales is higher than that for direct sales due to factors such as pricing advantages and customer service provided by distributors [6][9] Inventory and Sales Matching - The company confirmed that there are no significant issues with product operation, distributor stockpiling, or post-sale returns for its distribution customers [5] - The company maintains a buyout transaction model with distributors, meaning they do not have the right to return products except for quality issues [5] Customer Relationships - The reasons for end customers not purchasing directly from the company include the advantages of distributors in customer service and cost savings through bulk purchases [6] - The company has maintained good relationships with several major customers since its listing, with no significant anomalies compared to industry peers [11]

Core Viewpoint - Zhejiang Haideman Intelligent Equipment Co., Ltd. has received an inquiry letter regarding its 2024 annual report, prompting a detailed response concerning its sales model and revenue recognition practices [1]. Sales Model - The company reported a revenue of 765 million yuan in 2024, representing a year-on-year increase of 15.31% [2]. - The sales model has shifted significantly from "mainly direct sales, supplemented by distribution" at the time of its 2020 IPO to a model where distribution plays a more prominent role [2][3]. - The gross profit margin for distribution sales is higher than that for direct sales, indicating a strategic shift in sales approach [2]. Major Customers and Sales Performance - The company provided detailed sales information for its top five distribution customers, including sales amounts, changes, and reasons for variations [3][4]. - The total sales to the top five distribution customers reached 118 million yuan, accounting for 30.72% of distribution revenue [14]. - The sales performance of major customers showed fluctuations, with some customers experiencing significant changes in purchasing behavior due to market conditions [14]. Revenue Recognition - Revenue recognition practices are aligned with industry standards, with sales recognized upon delivery and acceptance based on contractual agreements [15]. - The company confirmed that there are no significant discrepancies in revenue recognition compared to industry peers, ensuring compliance with accounting standards [15]. - The revenue recognition for export sales is based on customs clearance and obtaining shipping documents, while domestic sales follow a different set of criteria [15]. Financial Performance - The fourth quarter of 2024 saw a revenue of 221 million yuan, reflecting a quarter-on-quarter growth of 29.83% [15]. - The company noted a seasonal pattern in revenue distribution, with the fourth quarter typically accounting for a higher proportion of total annual revenue [15]. Customer Relationships - The company maintains ongoing relationships with several major customers from before its IPO, although some have seen reduced transaction volumes due to changes in demand [12][14]. - The reasons for decreased cooperation with certain customers include shifts in their operational needs and market conditions, which are consistent with industry practices [14].