momo provides consumers with diverse, high-quality, and cost-effective products and services that are also environmentally friendly and socially responsible through collaboration with our supplier partners. We are firmly committed to maintaining a rigorous supplier selection process. In addition to requiring suppliers to provide high-quality products and after-sales service, momo also provides professional mentoring, consulting, and open channels of communication on each operational aspect so as to build a positively reenforcing sustainable supply chain.
Supplier ESG Management
momo has clearly established the "Sustainable Development Principles for Suppliers/Contractors" to explicitly communicate to suppliers the principles and standards we steadfastly uphold. The code of conduct covers four major areas: labor rights and human rights, health and safety, environment, and ethical standards. Suppliers are urged to jointly comply with sustainable development policies in order to be eligible to sell products on momo. In the year 2024, a total of 6,405 new suppliers and contractors signed agreements. As of 2024, 15,784 suppliers have signed agreements, resulting in a signing rate of 99.53% for new suppliers and contractors in 2024. An online announcement is made every year for effective management and regulation.
To strengthen sustainable supply chain management, external consultants were engaged to conduct interviews with relevant departments one by one, to review supply chain management processes and documentation, and to develop improvement measures. Simultaneously confirm the definition of "Key Tier-1 Suppliers" , and plan a "Supplier ESG Self-Assessment Form" specifically for key tier-1 and new suppliers. Initiate the supplier self- assessment in the first quarter of 2024, enabling momo to allocate corresponding resources based on the suppliers' current ESG implementation status, in order to formulate concrete measures for the supply chain development plan. A self-assessment questionnaire was distributed to 100 key suppliers and 62 new suppliers. Through the communication and identification results of the self-assessment, an overview of the sustainability status of suppliers and new suppliers contributing significantly to carbon emissions was obtained, including greenhouse gas management and human rights management. This serves as a basis for formulating the content of the 2024 supplier sustainability training program. In future years, momo will continue to conduct an annual key Tier 1 supplier ESG self- assessment, as well as ESG self-assessments for new suppliers, to continuously monitor the current status of suppliers and achieve a sustainable supply chain.
• New Supplier Selection
In 2024, more than 6,500 product suppliers committed to conducting business with integrity passed the review and joined momo. We conduct rigorous reviews of product intellectual property rights, information security, and other related provisions from four major perspectives. Suppliers must meet the relevant standards to become partners of momo, achieving a compliance rate of 100%. Additionally, we prioritize the sustainable development of suppliers. All new suppliers must sign the Sustainable Development Principles for Suppliers/ Contractors before formal cooperation to ensure compliance with environmental and social sustainability standards. To protect consumer rights, all products must be insured under product liability insurance according to their category. For the sale of special products (such as medical devices, food items, and valuable luxury goods), suppliers are also required to sign a guarantee letter and provide relevant certifications in accordance with regulations. After suppliers submit their product proposals, momo requires them to provide relevant information based on the product attributes to ensure that consumers can eat with peace of mind and use the products with confidence.
Regular Assessment of Current Suppliers
momo maintains regular communication with suppliers to promptly monitor their operational status. In the event of suspected product quality issues or regulatory violations, preventive suspension of business sales will be immediately implemented. Additionally, depending on the scope of impact and severity of the situation after verification, designated personnel will be assigned to provide assistance, guidance, or to terminate the cooperation. Additionally, for suppliers with lower operational activity, a regular health check of the supplier' s status will be conducted based on their business scale and account transaction conditions, to further assess the potential for future business development opportunities for continued cooperation.
momo is committed to protecting our brand reputation and putting an end to the sale of international counterfeit boutique products. Before products can be sold, a written review is conducted in Phase One to examine information such as the supplier' s profile, sales platform, and market rating. An on-site quality management inspection is conducted in Phase Two to assess sourcing, warehouse management, operating status, and other items. For cosmetics and health food products, manufacturer certification must be examined first to decide whether a manufacturer audit is required. The audit process includes checking the environment, production process, as well as the quality controls for raw materials and products. Domestic food and cosmetics factories must hold either a GMP, TQF, cGMP, ISO 22716, HAACP, ISO 22000 or ISO 9001 certification to ensure that their products comply with government regulations and satisfy momo' s management requirements during manufacturing. An on-site inspection must be conducted for non-compliant factories to verify the documentation for production processes from stock-in to end product, production and inspection equipment, environmental hygiene and waste management, and protective measures for production personnel. This is to ensure full compliance with regulations governing food and cosmetics factories. Audits must be conducted every three years or when their certification has expired. momo enforces strict safeguards on product quality and safety. Products may only be sold once we confirm that the factory is compliant or satisfies the relevant government regulations. As of 2024, a total of 775 suppliers have passed certification or audit factory visits; among the 84 suppliers inspected in 2024, 3 were found non-compliant. Non-compliant suppliers are prohibited from listing and selling products.
• Supplier Capability Development
momo regards its suppliers as important partners in corporate sustainability development, continuously sharing long-term accumulated sustainability experience, while assisting and guiding them to strengthen risk management and enhance the overall supply chain resilience. We leverage leading digital technology to provide convenient information systems and multidimensional sales data, fostering close collaboration and joint initiatives between suppliers and momo for mutual growth.
momo invites various product suppliers to collaborate on innovative operations, making effective use of third-party logistics and warehouse resources to implement the "Node Removal" initiative. To meet the demand volume of momo' s warehouses in the northern, central, and southern regions, goods arriving at various ports in Taiwan will be directly delivered to the nearest momo warehouse. This approach shortens delivery distances, reduces the number of transfer points from inbound to suppliers or momo warehouses, and also lowers the carbon emissions impact from vehicle transportation. Not only does it save logistics costs and free up warehouse space, but it also enhances collaboration among the three-party teams, creating a win-win situation. Simultaneously, we prioritize suppliers' use of reusable logistics containers for procurement, thereby reducing packaging materials and subsequent handling.
• Supplier Education and Training
Supplier training are divided into two formats : online and offline. Online training include system operation instructional videos, workflow explanation handouts, and frequently asked questions (FAQ). Offline training include assigning vendor service representatives to each supplier for providing one-to-one consulting and troubleshooting. momo also regularly conducts group classes and computer demonstrations with professional instructors in northern, central and southern Taiwan, and hosts workshops on SCM operation, after-sales service, marketing promotions, accounts and legal affairs.
In 2024, momo uploaded 14 new videos on the SCM Academy platform, with the platform's total annual views exceeding 53,000, maintaining a stable level of attention consistent with the previous year. A total of 98 teaching manuals, 33 teaching videos, and 194 frequently asked questions were published. Additionally, 17 internal business unit contract and warehousing training sessions were conducted, along with 12 system training for frontline service personnel sessions. By integrating diverse online learning resources and based on the supply chain needs of different industries, comprehensive operational processes are addressed, including product presentation, regulations, advertising and marketing, sales analysis, inventory stocking and warehousing, transportation and distribution, customer service, and ESG. Different learning themes are designed in phases, with content regularly updated according to supplier feedback to meet the latest demands, enhance learning efficiency, and simultaneously improve operations management and technological capabilities. The service targets of momo include corporate clients, distributors, and suppliers, providing a one-stop online service with diverse cooperation models. We will integrate the supplier service area and implement an online contract review mechanism to create a real-time, digital supply chain service platform.
• Supply Chain Information Security Management
momo possesses ISO 27001 and ISO 27701 certified information security management systems. It regularly promotes information security-related messages and protection policies, continuously enhancing suppliers' awareness of information security. In 2024, we arranged telephone interviews with five suppliers who needed to bolster their information security protection. We also launched a self-evaluation mechanism for suppliers' personal data protection, and provided recommendations on protection mechanisms based on the six major topics covered by the "Information Security Management Regulations" , including "personal data regulation," "external operating platform" , "order processing process" , "personal data security during distribution" , "internal computer security" , and "personnel and physical security" . From 2021 onwards, all new suppliers have been introduced to the personal data protection self-evaluation mechanism, and suppliers are required to complete an online self-evaluation before they can work with momo. As of the end of 2024, 100% of our 10,093 suppliers, along with 4 new logistics service suppliers, had completed the "Supplier Personal Data Protection Self-Evaluation" questionnaire.
Furthermore, momo has further strengthened the audit and management of supplier information security, implementing real-time risk control measures. In the event of suspected information security breaches, immediately identify and audit the relevant vendors, activate the supplier backend system suspension mechanism, and arrange on-site or telephone information security inspections. Strictly audit vendors with information security concerns and establish detailed criteria for the severity of the information security breach and conditions for reinstatement. Moreover, in terms of preventive information security risk control, momo has also strengthened password and data protection operations for suppliers' backend systems to enhance data security and reduce the risk of data leakage from backend systems.
To comprehensively enhance information security, momo has partnered with Taiwan Mobile Group to introduce the first-ever momo Secure Communication Platform in Taiwan' s e-commerce industry. This platform replaces personal phone numbers on delivery slips with codes; logistics personnel use these codes to make calls, allowing deliveries to be completed smoothly without displaying personal information on the delivery slips. By the end of 2024, the number of cooperating vendors has exceeded 15,000. momo has assisted in guiding over 99% of product suppliers and external logistics distributors to implement the use of the momo Secure Communication Platform, significantly reducing the risk of personal data leakage during the delivery process.
As a sustainable consumption platform, momo rigorously manages product safety by establishing safety inspection mechanisms for various types of products to safeguard consumers. momo carefully selects suppliers and requires all suppliers, by contract, to ensure that their products comply with regulations and labeling requirements. Additionally, a mystery shopper ordering inspection and audit mechanism is established to guarantee product quality and safety. For product quality assurance, the Company set up the "Quality Management Department" and is continuing to invest in product quality, ingredient, source, and Chinese labeling testing to ensure compliance. On the distribution end, momo has integrated quality management into the core operations of its logistics centers. In late 2019, the Northern Distribution Center implemented the ISO 9001 Quality Management System and established a quality policy centered on "full participation, continuous improvement, and customer satisfaction" . The system is guided by three key indicators―standardized operational control, effective corrective and preventive measures, and sustainable corporate development―to ensure seamless coordination across all stages of logistics operations and achieve the highest standards of quality. In 2020, momo' s Northern Distribution Center became the first e-commerce distribution site in Taiwan to be certified by SGS ISO 9001 Quality Management System. Returns and transportation have been included in the scope of etxernal audits in 2023. In 2024, a total of 374 individuals have completed the online ISO training, achieving an ISO employee coverage rate of 62%. ISO training has been implemented for everyone from supervisors to each individual staff member.
Three Types of Product Inspections
One of momo' s primary operational priorities is its commitment to product quality for consumers. We implement a three-tier inspection safeguard system comprising corrective inspections, preventive inspections, and periodic inspections. Through this rigorous review and verification process, we ensure that products comply with regulations and labeling requirements, thereby providing consumers with consistent product quality and a reliable shopping experience. 107,466 inspections were conducted in 2024 across three main categories : corrective inspections, preventive inspections, and regular inspections.
Anomaly Management and Prevention Mechanism
Regarding products that have already been purchased and shelved but do not comply with regulations, momo immediately activated a quality control mechanism to strengthen the inspection of supplier purchases. In 2024, an AI-assisted detection system will be introduced to rapidly analyze and interpret large volumes of textual information during product compliance reviews. This system will handle documents from various regulations, standards, and requirements, thereby improving inspection efficiency and accuracy. Based on this, a comprehensive inspection of the products was conducted, and abnormal items were removed from the shelves to prevent them from being shipped to consumers, thereby avoiding the recurrence of similar customer complaints.
