Business Model

Our Trading Centre offers close to 13,000 different types of Measuring and Cutting Tools from more than 500 international and domestic brands available for sale, ranking the top among the Measuring and Cutting Tools trading centres in the PRC in terms of number of type and brand of Measuring and Cutting Tools as at 31 December 2019. We believe that our ability to provide a large variety of Measuring and Cuttings Tools products to the industry players and other customers has contributed to the strong brand recognition of our Trading Centre in the Measuring and Cutting Tools in the PRC.

We lease the units in the First and the Second Floors of our Trading Centre to corporations and individuals selling Measuring and Cutting Tools. We designate part of the Third Floor as the Electronic Business Park to lease to the Measuring and Cutting Tools e-commerce business operators. We use the Fourth Floor as our office and the basement as the car park. We also provide property management service and support services, namely the Wenling • China Measuring and Cutting Tools index and the Measuring and Cutting Tools Financing Service, to our tenants.

With respect to rental fee, we primarily charge our tenants based on the successful bidding amount that they offered during the public tender for the units of our Trading Centre. With respect to property management service fee, we charge them in accordance with the tenancy agreement.

One of the major development milestones of our Trading Centre is the grand opening of the Electronic Business Park on the Third Floor in August 2016. Its main purpose is to provide an open, low-cost and convenient trading platform for the e-commerce business operators in the Measuring and Cutting Tools industry. We have successfully attracted certain remarkable Measuring and Cutting Tools e-commerce business operators, one of which is Tools Union* (刀具联盟), which was chosen by Wenling Bureau of Commerce* (温岭商务局) as the e-commerce model enterprise* (电子商务示范企业) in 2016.