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In order to adapt to the development of mobile internet, e-commerce and the changes in consumers’ consumption patterns and to improve sales channels’ cost of sales, the Group was committed to the innovation of channels. In 2014, the Group continued to optimize its original mall-based channels, which further improved the entire construction of sales channels for the purpose of creating convenience for consumers and improving consumption experience, and primarily promoted the construction of sales outlets such as professional retail outlets, ecommerce and direct sales by coaches. For the construction of physical sales outlets, emphasis was placed on the improvement of the shop quality and consumption experience, reduction of sales outlets with low efficiency and further development of HOTTO water lifestyle international brand collection store and the indoor fitness store. Meanwhile, the Group also took advantage of the features of the Group’s products including specialization and compatibility to encourage the offering of sales packages with complementary products and brands by means of wholesale and distribution.

All of the above measures provided extra consumption convenience to consumers, improved their consumption experience while enabling distributors to adapt to market changes and the trend of channel development, lowering the cost of sales and ensuring profit level.

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