SOURCE: Yasheng Group

January 11, 2011 11:23 ET

Yasheng to Expand Gift Package Product Line, Branding & Marketing

Gift Segment Offers Higher Profit Margin Opportunity

REDWOOD CITY, CA--(Marketwire - January 11, 2011) - Yasheng Group (OTCQB: YHGG), a high-growth diversified China-based agricultural company with US headquarters in California, today announced the expansion of the gift package product line and a branding initiative covering high-end green foods.

With a new marketing commitment Yasheng plans to significantly grow the gift sales segment from a relatively small unit at this time. Through product development and marketing and advertising campaigns using more attractive packaging and highlighting Yasheng's many famous brands the company plans to reach the specialty luxury market in China. The company believes this segment can generate higher profit margins in the range of 20-30%.

The company expects consistent market demand for the gift package line given China's increasing GDP and gift-giving traditions. With a history dating back more than 5,000 years, China has a highly-ritualized gift-giving custom steeped in traditional values and practices. In addition, continued economic expansion fosters the growth of China's middle and upper income classes, which leads Chinese consumers to increasingly seek high-quality specialty food products to satisfy their gift-giving needs.

Fresh fruit is a common gift in China and is purchased for a variety of holidays, special occasions, and other events. Yasheng produces several award-winning fruits. When selecting fruit to give as a gift, price is largely ignored as consumers are willing to pay premium prices for large, smooth, unblemished fresh fruit. Fruit gift baskets are extremely popular since the combination of colorful fruit, perceived health benefits, and attractive packaging appeal to most Chinese consumers. High-end, luxury gift baskets may include other items as well such as premium-priced tea, imported wine, and edible seeds.

As Chinese consumers are becoming more affluent, they are also becoming more attuned to the health aspects of their consumption habits. Most gifts that fall under this classification are given to more mature relatives and friends during holidays and to hospitalized patients during their recovery period.

Chairman Zhou Changsheng commented, "For gift-giving purposes it is the quality of the gift, not the quantity that counts in China. Our strategic promotional campaigns are designed to help consumers recognize the Yasheng brand and that it stands for superior product quality. We believe this brand recognition will help us perform well in the high-end consumer segment. We are also making efforts to keep the brand 'fresh' by developing special packaging reflecting the themes and customs of the eight major Chinese holidays."

Currently Yasheng Group sells several products as gift packages including Tiaoshan all organic fresh fruits, organic honey and medicinal honey products, and edible nuts. The company expects to expand the product line with mixed gift packages that include high-quality branded not limited to domestic specialty food and beverage products.

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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