DW8 Limited, operates Kaddy, a unique and innovative technology platform which provides beverage suppliers an end-to-end supply chain solution that allows them to connect with buyers, simplify operations, streamline payments and fulfill both trade and consumer orders. The Company is pleased to disclose its new pricing model and rate card and to provide an update on the progress of `Project One' (savings and synergies) that are expected to both increase revenues and reduce operating costs. The new pricing model changes, which take effect from 1 July 2022 are expected to make the integrated Marketplace & Fulfilment platform substantially more attractive to both existing and new suppliers, and will accelerate growth rates across all key metrics including suppliers, product SKU's, buyers, average basket size, frequency of purchase and sales GMV.

Kaddy Membership Subscription Program: The first major change to the pricing model is the introduction of a tiered Kaddy membership subscription program that ranges in cost between $50 and $250 per month, via a SaaS subscription payment. There is also a `Freemium' membership option that allows any supplier to start selling on the Marketplace within minutes without any long-term commitment. Order processing fees on sales generated via the Marketplace will vary depending on which membership level a supplier opts into, with the `Freemium' level member remaining at the existing rate of 5% and as low as 1.25% for `Enterprise' members.

Over time, the range of benefits offered at each Kaddy Membership Program level will be extended, and include benefits for suppliers using its Fulfilment services. Order Processing & Payment Accelerator Fees: The second major change to the pricing model is the splitting of the existing Marketplace commission into two parts: an Order Processing Fee and Payment Accelerator Fee. Under the current Marketplace pricing model, accelerated payment is included within the commission charged and all suppliers are paid within 5 days of delivery.

This debtor factoring service is provided by a third party and the cost to provide this was included within the existing commission structure. While accelerated payments appeal to smaller suppliers, the feedback Kaddy has received from larger and more active suppliers is that they would prefer more flexibility and be able to choose whether they are paid within 5, 14 or 33 days. The Company has recognised that the current `one size fits all approach' was causing a substantial amount of friction, in turn restricting Marketplace top line sales growth.

Taking onboard this feedback, the Company has made the Payment Accelerator Fee optional and for those using the service, has introduced different rates depending on how quickly they wish to be paid. This allows the Company to reduce the Order Processing Fees with no reduction in its profit margin and provide a more flexible pricing model structure that will accelerate key metric growth. Corporate Display Advertising Fees: The Company will also be introducing a range of advertising and promotional tools to help suppliers launch new products, build their brands and expand into new markets.

The introduction of this new revenue stream over the course of FY2023 is expected to help o set the decrease in average blended margin achieved via Marketplace trading fees, by providing an avenue for brand development, advertising and marketing budgets of existing customers to be spent on the platform. New Rate Card: The Company announced that Kaddy Fulfilment's new rate card comes into effect from 1 July 2022. It is expected to lift total revenues generated in the Fulfilment division by circa 10% from First Quarter FY2023 onwards.

This is in addition to the Fuel Levy (currently 8%) that was introduced in April 2022, to o set the significant increase in transport costs that the Company has absorbed over the last two years. While this year's price increase is higher than normal, it takes into account the fact that the Parton Wine Distribution (now part of Kaddy Fulfilment) only increased their rates once in the last two years as an e ort to support its customers through the long periods of lockdown due to Covid-19. Expected Benefits: The Kaddy Membership Program, and new pricing model has been undergoing testing for several months.

Feedback from existing suppliers so far has been extremely encouraging, allowing the program to be offcially launched immediately. The introduction of the program, which offers benefits and savings across the whole platform is expected to help increase the overlap of suppliers using both Marketplace and Fulfilment services. This cross pollination of services will be enhanced by the soon to be completed migration of the Parton Wine Distribution (now part of Kaddy Fulfilment) existing supplier base onto the Kaddy CONNECT platform, allowing Kaddy Marketplace orders to be automatically picked, packed and fulfilled.

The reduction in the headline Order Processing Fee to just 1.25% is anticipated to tip many of these larger producers, distributors and wholesalers currently sitting in Kaddy's potential supplier pipeline over the line. The company also expect the reduced Order Processing Fee will help generate a deeper level of engagement with existing suppliers and encourage their customers and own sales representatives to put more orders through Kaddy Marketplace to take advantage of the inherent benefits such as reduced administration, guaranteed payments and easy reordering. Finally, the introduction of a range of advertising and promotional tools will provide a channel for the 1,200 brands the company currently works with to launch new products, build their brands and expand into new markets developing stickier supplier relationships and a new high margin revenue stream.