SOURCE: Yasheng Group

January 25, 2011 08:00 ET

Gansu Yasheng America Trade Corporation Sets Business Strategy, Marketing & Branding Focus

REDWOOD CITY, CA--(Marketwire - January 25, 2011) - Yasheng Group (OTCQB: YHGG), a high-growth diversified China-based agricultural company with US headquarters in California, today announced the strategy for the recently-established Gansu Yasheng America Trade Corporation (the "Company"), a wholly owned subsidiary of Yasheng Group that focuses on domestic and international trade. The Company will focus on the development of product lines marketed to premium markets, which will provide better margins. The unit's marketing focus will be high-end organic, specialty, processed, and luxury foods. In addition, the unit will continue the promotion of Yasheng Group's many brands for consistent quality and food safety assurances.

In making the announcement, the Company noted that China's consumers want more choices for their food consumption and are demanding quality and food safety assurances. The average income of the middle class has risen every year and with it the demand for luxury products. According to a USDA Gain Report on market developments in China, the average consumer is willing to pay three times as much for products with high quality, green, and safe characteristics. The rural population has been migrating to the major cities over 10 million a year, putting more demand on institutions, food processing companies, and catering services.

The Company's business strategy is to establish long-term direct customer channels and to develop more direct sales with higher margins. To achieve this, it will expand the current bulk and retail packaged product lines to meet the varying needs of institutional and big chain supermarket buyers. Special packaging will extend the shelf life of the products; quality assurance will be enhanced with sound logistics planning for timely delivery. Fresh & Fresh Flash Frozen IQF products will be available for volume customers. The company will also expand the processed food offerings with dried fruits and vegetables as well as purees and concentrates. For institutional buyers the Company will offer bulk packaging choices to meet the needs of large catering services, hospitals, schools, and other municipalities that require a consistent supply of quality products. On average these product lines are expected to generate 18% profit margin.

The Company plans to further develop its brands including Yasheng, Tiaoshan, Xiaheqing, Snakefruit, Jingrun, and Yamei by using consistent design and attractive specialty packaging and marketing materials to increase brand awareness and build long-term customer loyalty. In addition, the company plans to continue to register new trademarks as new product lines are developed under the "Yasheng" parent brand. The Company will expand its sales and marketing team to be represented more within China's upscale markets such as Beijing, Shanghai, Shenzhen, Hong Kong, and Taiwan. An international team will be established under the new "Yamei" Gansu Yasheng America Trade Corporation to focus on product development to meet diverse market demands of international clients as well as to open new distribution channels and focus on a product line that serves volume direct customers, distributors, and wholesale distribution hubs. 

Mr. Zhuang, Gansu Yasheng America Trade Corporation's business development director, states, "Yasheng Group will continue to expand its existing capacity of strategic core food commodities and take a more aggressive approach to the higher-end organic food, specialty products, processed foods, and luxury food markets. We expect this strategy to strengthen our top line, generate higher margins, and most importantly for long-term growth, giving us a strong foothold to capture increasing market share as competition rises in China."

Yasheng Group

Yasheng Group (OTCQB: YHGG) (www.yashenggroup.com), founded over 30 years ago, is a US holding company that conducts primarily agricultural operations in the Northwest of China. Today it is one of China's leading producers and marketers with six major product segments including field crops, vegetables, fruit, specialty crops, hops, hemp, seeds, beef and poultry. Yasheng is a supplier of high-quality agricultural products to world-famous conglomerates such as McDonald's, KFC, Tsingtao Beer, and Pepsi. The company is lead by a highly qualified management team and it has total assets of approximately $1.7 billion, over 15,000 employees, and a history of strong sales and earnings growth.

Safe Harbor Statement

Except for the historical information contained herein, certain matters discussed in this press release are forward-looking statements which involve risks and uncertainties. These forward-looking statements are based on expectations and assumptions as of the date of this press release and are subject to numerous risks and uncertainties, which could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties are discussed in the company's various filings with the Securities and Exchange Commission. The company assumes no obligation to update these forward-looking statements.

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