We are a leading electric bicycle manufacturer in China. We offer over 100 vehicle models serving a variety of personal transportation and commercial uses with three main product lines: traditional leadacid electric bicycles and scooters, next-generation lithiumion electric bicycles and scooters, and multipurpose specialty electric vehicles.
Our advanced research and development capabilities have been a key driver of our rapid growth. As of March 31, 2011, we held a total of 70 patents in the PRC and have 29 patent applications pending approval. We have focused our research and development activities on the design and engineering of our core components, including batteries, battery chargers, controllers and electric motors. In particular, we are an industry leader in battery and batteryrelated technologies for electric bicycles, which enables us to significantly improve the performance and life cycle of the batteries used in our products and to offer integrated battery solutions. Our advanced battery and batteryrelated technologies include lithium-ion battery application technologies, battery management and charging systems, and battery repair technologies.
Our key competitive advantage is in our lean operation. A well devised manufacturing management system derived from a Just In Time system is in place to make quality products at competitive cost level which enjoy a premium price over competing products. We believe we are one of the very few electric bicycle manufacturers in China that has adopted an enterprise resource planning system, or ERP system, to manage many important parts of our business including business flow from suppliers to customers. The information made available through our ERP system provides visibility for key performance indicators across all major business functions required for evaluating our business and operation objectives, enables us to plan and manage our inventory level and working capital accurately and efficiently. We are in the process of upgrading our ERP system to integrate more functions of our business into the system so that we can manage our business even more efficiently.
We market and distribute our products nationwide through our distribution network of over 900 distributors, which operate an aggregate of over 1,000 sales outlets. Approximately 840 of these sales outlets sell the Luyuan brand products exclusively. Our focus on exclusive distribution arrangements allows us to closely monitor and manage our distributors and maintain a uniform product pricing policy across our markets in 29 provinces, autonomous regions and centrally administered municipalities in China. Through a unified store front and layout, coordinated sales campaigns and extensive training programs we provide, our distributors not only distribute our products but also serve as Luyuan’s brand ambassadors.
We provide comprehensive aftersales services including maintenance, inspection, repair and 24-hour telephone customer service as well as roadside assistance and door-to-door repair services, and these functions are mainly carried out through our distributors. Our distributors are specially trained in servicing and repairing our products and allow us to efficiently provide our customers with high-quality replacement parts and accessories on a timely basis. We also maintain a comprehensive customer information database and continually distribute updated service and marketing information to our end customers. Additionally, we offer on-site battery repair, which is the responsibility of our distributors and provides added convenience to our end customers. It helps promote our brand image as a leading industry player with a strong technology platform and a comprehensive after-sale service network.
