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• Continue to strengthen our brand recognition and to enhance our market position

To further strengthen and capitalize on the established reputation and recognition of our “Labixiaoxin” brand, we are currently consolidating all our existing brands with the intention to use “Labixiaoxin” as an umbrella brand to market all our products, with multiple sub-brands to market our different product segments.

In addition, we plan to enhance our brand image by adopting a multi-channel advertising strategy: print media advertising, prime time television advertising and Internet advertising.


• Continue to broaden and strengthen our distribution network in China and further enhance our relationship with wholesale distributors
and key account customers

We intend to expand our distribution network into other cities in the PRC with growth potential surrounding our existing markets by increasing our advertising and promotional activities in these areas, as well as engaging more regional wholesale distributors to sell our products to the retailers. We believe improved market penetration will help us to gain access to a wider group of end consumers and support our future growth.


• Expand and enhance our product offerings through continued product development effort

We plan to invest in and strengthen our market-oriented product development activities to continuously provide innovative products to differentiate ourselves from other competitors and accommodate the changing preferences of consumers. For example, with growing health awareness among consumers in their consumption of snack food, we intend to focus our product development efforts on manufacturing healthier snack food such as low-sugar or low-calorie jelly products.


• Strengthen our market position through strategic production capacity expansion

We plan to strengthen our market position in the snack food industry and achieve better economies of scale by expanding our existing production facilities and constructing a new production facility. We intend to invest approximately RMB450 million to raise the annual production capacity of our Tianjin production facility from 55,000 tons to over 100,000 tons of jelly snacks and jelly beverages in the next Five years. Moreover, we plan to expand our production capacity by constructing a new production facility in Chuzhou, Anhui Province. We have commenced construction of our Chuzhou production facility in August 2011, and plan to start manufacturing primarily jelly snacks and beverages at this production facility in the first half of 2013.