We intend to maintain our leading position in the residential property market in Henan Province by continuing to implement our Provincial Strategy in Henan Province, and enhancing our overall competitiveness and market share with the aim of achieving sustainable, stable and profitable growth.We intend to achieve our overall objectives by pursuing the following strategies:
We plan to further strengthen our leading position in the residential property market in Henan Province and continue to build our brand recognition. While in percentage terms, Henan Province currently has a greater rural population than some other provinces, most notably provinces on China’s eastern coast which have seen a greater level of industrialization, our Directors believe that the PRC Government’s urbanization policy will contribute to an increase in Henan Province’s urban population in the next few years. With this trend towards urbanization in Henan Province, our Directors believe we are likely to see greater demand in urban centers for the type of projects that we develop. To capitalize on the economic development and urbanization in Henan Province, we intend to continue to focus on developing medium- to large-scale residential communities in major cities in the province which we perceive to have high-growth potential.
We intend to continue to expand our land reserves for new property development. At the same time, we intend to closely monitor and control our capital sufficiency with the aim of ensuring sustainable growth. We plan to continue our disciplined approach to land acquisitions, making decisions on land acquisitions based on thorough research and analysis, taking into consideration important factors such as a potential project’s expected return profile and the future growth prospects of the project location. In addition, we also seek to make selective investments in the form of joint ventures and/or acquisition of companies with desirable land reserves should suitable opportunities arise.
We aim to further improve our operational efficiency and profitability in order to enhance our competitiveness and achieve sustainable, stable and profitable growth.
We will continue to deploy a business model of developing properties using similar designs and construction materials across different project sites. We have developed what we consider to be a cost effective “winning formula” from both the customers’ and our own point of view, by adopting principal product lines such as Forest Peninsula, which we introduce in different cities in Henan Province. Developing projects in this way promotes greater efficiency in design and development and savings in procurement of materials and services, and accelerates project development cycles. It also helps us to achieve consistency in the quality and image of our developments, which we consider to be important to our brand positioning and marketing.
We have entered into long-term framework agreements with reputable design firms, construction companies and building material suppliers. The cost of building materials constitutes a significant portion of the total construction costs of our projects. We seek to benefit from the increasing scale of our operations by continuing to establish strategic relationships with major suppliers and negotiating bulk purchase discounts for certain construction materials. Through these strategic relationships, we intend to increase our control over construction quality and construction progress, and gain more effective control of overall development costs.
We plan to further enhance the recognition of our “建業 ” (Jian Ye) brand in Henan Province by continuing to provide high quality living environments and comprehensive customer services to our customers. Our Directors believe our brand name and reputation in the market also depend on the quality of our products. We will continue to leverage our past experience and expertise in developing high quality residential properties targeting the mid- to high-end market. We provide membership services to our Jianye Club members who are our existing and prospective customers through various channels such as our call center and internet forum. We distribute a free monthly newsletter, “Jianye Lifestyle”, to our Jianye Club members and carry out regular customer satisfaction surveys.Further, we have a customer relationship management system which receives feedback from customers and thus provides a platform for our analysis of customers’ needs and preferences. We intend to expand our customer services through our Jianye Club and organize events to promote neighborhood relations and foster communications with our end-buyers. We also intend to enlist more participating merchants to expand our client database and offer more discounts and special privileges to our Jianye Club members. Our Directors believe that by providing value-added services and products to our existing and prospective customers, we will be able to further enhance our brand recognition and to build goodwill and brand loyalty.