Unidentified Analyst: What is the benchmark of your decision to opening one more channel or just ?
Yan Li: Right. I think €“ so let me answer the second one first. I think the second one is actually easy, whether the stores are self-profitable because all our stores are franchise stores. So, in reality, if the stores are profitable, the store owners tend to keep the store open. These stores are not profitable throughout the year, a monthly basis, they may not be profitable. But even for the entire year, it’s not profitable, then it’s actually difficult to keep the store open. I think that’s €“ so it’s €“ and this will be €“ we look at city by city, we look at regional basis. Now, in terms of the store sales improvement, I think there are really two things we’re looking at. One is, how do we get more traffic to the stores.
So this year, we started a little bit last year, but really, this year, is actually what we’re planning is actually, as we mentioned, basically providing stores with sales leads generated from online JD and Tmall. So, our sales online, so what we call the O2O method. Basically, the users can make the purchase online and decide to pick-up the scooter at an offline store. Last year, it only represents roughly about less than 10% of our sales. And this year, we’re looking to boost that to basically to 20% or 25% of our sales coming from online leads. So that will actually be increased traffic to the stores. I think second is actually a list of initiatives that we’re implementing in the stores to help the conversion rate. So, once you increase the traffic, it’s about how do you convert the traffic to purchase.
Those will be things like optimize the store layout and the product portfolios in the stores because we also recognize different regions, different cities. We have extensive product portfolio, but some product actually sells better in some regions. So, we need to make sure the store optimizes the product portfolios that carries in their store. And there was a clear message and the clear trainings to the store staff, such that when users coming or potential customers come in there is easy to communicate to the customers what to buy. And lastly, I think it’s €“ we also recognize actually accessory sales are a great percentage of the store sales and the . I think with our product, like the UQi, which actually really call for customizations, there’s tons of assessors can be developed for the particular product such that store can €“ besides selling the scooters, they can sell additional accessories to make profit.
I think that’s what are the three things €“ really the three things we’re taking. But having said that, I think there is an underlying theme, which is the product itself has to be attractive and competitive. So, I think this is actually what we feel very confident this year is having the new product online, we have a bunch of new products ready to roll-out in the second quarter or starting our second quarter this year. And we have demonstrated really last quarter €“ well, fourth quarter, last year, is actually with all the positive news we received from the new product. Once we have the newly defined product out, it helps boost sales and also help improve the store performance. Hopefully that answers the question.
Unidentified Analyst: Okay. Thank you very much. That’s all my questions.
Operator: Thank you. We’ll now move on to our next question. Please standby. Our next question comes from the line of from CITIC. Please go ahead. Your line is open.
