SKSHU Rules

After defining its corporate mission, vision, spirits and corevalues, 3Trees has refined a

series of supporting philosophies centeringon brand building, product R&D, production,

marketing and talent development in orderto make sure that 3Trees follows the right direction and unswervingly practiceits core values to move towards its final dream.

 

1.Health ecology: fostering a health concept, developing healthy employees,providing healthy products, spreading health culture and creating a healthylife

   

The “health”advocated by 3Trees is not the traditional concept that “no sickness means health”.It is a dynamic balance which includes human body and mind, socialrelationship, living environment and other aspects. 3Trees’ health ecologyadvocates a healthy mindset and development of healthy employees internally andprovides healthy products and spreading health culture externally.

 

Fostering ahealth concept

Buildingsplendid corporate character, developing reasonable development strategies, creatingefficient organizational structure, establishing sound corporate ethics,implementing harmonious business management

 

Developinghealthy employees

With emphasis onemployees’ physical and mental health, importance is attached to improvingemployees’ working skills, professional expertise and physical health andenhancing their moral quality by standardizing their rules of conduct in orderto develop healthy employees with satisfactory moral, intelligent, competentand physical levels.

 

Providinghealthy products

3Trees alwayssticks to the R&D philosophy of “ultimate performance and application for ultimatehealth”, pursues breakthroughs and innovation and implements standardized,subtilized and extremely stringent quality control to provide healthy productsto the society

 

Spreadinghealth culture

3Trees fostersits brand culture with such core values as health, naturalness and greenness andadvocates and spreads health culture by using its products and services as avehicle to guide green consumption demands.

 

Creating ahealthy life

3Trees makesunremitting efforts to beautify a healthy living environment for human beings andcreate a healthy life by improving the quality of life of its employees andusers, fulfilling its social responsibilities and participating in greenprograms for public good.

 

2.Corporate baseline: integrity, environmental friendliness, safety and premiumquality

 

During its development against all odds, 3Trees has developed soundcorporate characters: integrity, environmental friendliness, safety and premiumquality. They are 3Trees’ baseline in conducting itself and they will beconsistently followed by 3Trees in the future.

 

Integrity

He who does not trust enough will not be trusted. Integrity is atraditional moral character of the Chinese nation and a fundamental principleof conducting oneself. Like a fragile glass cup, it is a single-use thing foreveryone. Therefore, 3Trees require all of its employees to be honest, credit-minded,impartial and practical; it requires them not to practice falsification orfraud or to sow discord and to effectively fulfill their promises andagreements and perform their authorities and obligations given by the company;it requires them to abide by the company’s rules and systems and socialmorality and not to infringe the interests of the company and others. In3Trees,RMB 20” is the baseline of integrity.

3Trees guarantees 100% trustworthiness for its employees andpartners while it also requires its employees to deliver 100% trustworthinessto the company, the society, partners and consumers. 3Trees allows no dishonestact or person to exist in the company. As Mr. Hong Jie put it, “Man has twolives, one from our parents and the other from integrity. When one losesintegrity, he loses his life.” In 3Trees, integrity also has another meaning.3Trees has highlighted that when the company is developing fast, it isinevitable to have a wide range of management and market-related issues; it isnot dreadful to have any problem; it is dreadful to hold back unpleasantinformation and deceive one's superiors and subordinates. Managers at alllevels shall remember that in 3Trees, any act of hiding problems will betreated as fraud and included in the category of dishonesty.

 

Environmentalfriendliness

3Trees always gives priority to environmental protection in itscorporate development strategies. From building green factories, popularizinggreen product standards, creating green supply chains to drive the entireindustrial chain to take the road of green and sustainable development, totaking the initiative to participate in environmental protection causes andcalling upon all people to be part of the effort for protecting nature, andfrom cleaning and energy conservation control which are critical to the entireprocess of enterprise production and operation to employees’ daily behaviors ofcaring about the environment, 3Trees integrates its love and awe for natureinto its corporate characters and make them become its usual practice.

 

3Trees combines environment management and corporate management andestablishes and improves environment management organizations and operatingmechanism, which are adopted in its daily management. From environmentalinfluences imposed by sources of raw materials to energy conservation,consumption reduction and pollution reduction in the process of production, andeven to the control and comprehensive utilization of pollutants, 3Trees triesevery means to develop more low-pollution and pollution-free products, promoteclean production aggressively and achieve source control by giving priority tothe use of low-toxicity and hazard-free processes, technologies and equipmentin order to eliminate any impact on the environment by any hazardous waste.

 

3Trees is the first enterprise to be certified by ISO14001Environmental Management System and China Environmental Labeling in theindustry in China. Many of its products have been included in the List of GreenProducts for Government Procurement. The company carries out environmentalmonitoring on a regular basis and formulates environmental protection andcontrol facility management procedures to perform all-round regulation andeffective control on sources of pollution. 3Trees drives the sustainabledevelopment of its environmental management and accomplishes its important taskof manufacturing premium and green coating products and building anenvironmentally friendly society.

 

Safety

Safety is “1” before “0”. Without safety, everything turns intozero. 3Trees people are expected to have safety awareness and crisis awarenessof keeping highly vigilant to prevent any accident. In particular, as amanufacturer of hazardous chemical substances, 3Trees is required to develop aneffective, rigorous and scientific environmental safety management system and culture.

 

Since its establishment, 3Trees has formulated environmental safetymanagement systems and ten safety prohibitions in accordance with relevantstate laws and regulations. It defines subject responsibilities forenvironmental safety production and carries out environmental safety trainingand education assessment to strengthen risk awareness. Besides, it has createdthe 100-point safety daily visual inspection mechanism to manage potential riskidentification. 3Trees equips itself with firefighting trucks and fireemergency response team. It also uses all-weather intelligent monitoring systemfor surveillance over the entire factory. In this way, system-based andstandardized environmental safety management is promoted and executedeffectively.

 

Since the efforts for safety production are endless, environmentalsafety work shall be carried out in a progressive manner so that the safety conceptwill go deeply into the mind of people. Each employee is supposed to be able toperceive every risk beforehand, follow norms in operation to each detail andmake emergency response. Every accident can be prevented and all hazards can becontrolled. A good safety environment leads to excellent performance.

 

Premiumquality

Premium quality means quality and taste. In 3Trees, everyone is acraftsman. We are committed to crafting products and services with quality andtaste by abiding by craftsman spirits: devotion, focus and perfection. Qualityis fundamental to the survival of 3Trees and high-end taste is an importantmanner of value competition for 3Trees. 3Trees values premium quality. This meansthat it strives to provide its users with products and services with guaranteedquality and high-end taste functions so that 3tree’s products can representtheir noble status and taste. By persisting in replacing marketing capabilitieswith its products, 3Trees keeps collecting and analyzing user informationthrough a wide range of channels, studies their value and understands theirneeds and expectations. Moreover, by integrating its R&D system into its OAmanagement platform for online operation and new product research anddevelopment, the company has achieved integrated operation of preservation ofR&D data for new products, tracking and reviewing of R&D process aswell as verification and approval. New materials and products must pass thecomprehensive evaluation in terms of environmental protection indexes,performance indexes and construction tolerance conducted by the qualityassurance department, the technological service department and customers, andgo through small-scale tests, pilot-scale tests and market tests before goinginto production officially. This guarantees that product performance in allaspects can satisfy customers’ needs and excels relevant state standards.

 

3Trees believes that it can please its users, win in the market andenjoy the trust of the society only with consistent quality. 3Trees emphasizesthat the initiative shall be taken in the next step of the process to monitorthe quality from the previous step. This enables the quality concept featuringindependent inspection to be shared by all employees and the sound concept to bepart of its corporate culture that quality originates from production andR&D rather than through inspection.

 

In 3Trees, premium quality means not only premium product quality,but also premium quality of business management, production and sale, servicequality, etc. No act which sabotages corporate quality management is allowed.Therefore, 3Trees launched the excellent performance management model in 2009in order to improve its business management quality continuously. It uses themethod of in-depth integration of industrialization and information orientationand applies information technology to enhance and drive 3Trees’ productionmodel to transform and upgrade to digital, network-based and intelligentmanufacturing, thereby pushing the enterprise to transform itself towardsintelligent manufacturing. With SAP information-based system and OA managementplatform-based online operation of production and technological quality managementprocess, 3Trees provides experience-based and interactive quality services withonline and offline close communication while guaranteeing continuousoptimization, standardization and normalization of systems and processes. Inthis way, 3Trees’ suppliers, users, employees and other stakeholders areincluded in its operational process in order to achieve effective operation ofits all-round quality management system.

 

3.Brand philosophy: health, naturalness and greenness

Healthy paint = 3Trees, 3Trees = healthypaint” is the brand equation which 3Trees has been endeavoring to operate sinceits establishment. 3Trees is committed to being the healthy paint brand whichoccupies the first place in users’ mind and creating a multi-category healthybrand profile based on this.

 

As the first enterprise to put forward the concept of healthy paint,to define its main brand keynote as green and to call on returning to one’sheart by getting close to nature, 3Trees breathes a fresh air into the chemicalindustry. From corporate image to corporate spirits, 3Trees has developed thegeneral guiding principle of health, naturalness and greenness as its brand philosophy,by which it has established the consumption association of health,environmental protection and sunniness.

 

3Trees guarantees the readiness formoving in” is the first-generation brand slogan of 3Trees.Ready-for-move-in” represents healthyproducts and rapid services. This embodies 3Trees people’s solemn commitmentfor healthy and environmentally friendly products and sincere guarantee forrapid and efficient services. “Heathy families live under ‘3Trees’.” A healthyand mind-relieved living environment means not only peace of mind at theconcept level, but also true trustworthiness in terms of actual product valueand effectiveness. Coating is not supposed to be a source of pollution inhomes; instead, it shall be a reassured guarantee of a healthy environment.

 

The design of 3Trees’ upgraded logo is inspired by 3Trees’persistence in the core brand philosophy of ultimate health. In this design,the leaf-shaped appearance expresses 3Trees’expectation to live in harmony withthe environment; the combination of green, red and white colors is retained asits color scheme, which is bright, chic, young and approachable; the green colorinherits 3Trees’ consistent concept of ultimate health and the red color lookslike a flower that blooms among green leaves, showing the great vitality of3Trees on the backdrop of environment and society.

 

Based on the green color and the above logo, 3Trees has created itsspecific brand identity system and its brand proposition is embodied in itsexclusive stores, packaging, brand mascots, a wide range of advertisements andpublicity materials, and promotion and publicity campaigns.

 

4.Development philosophy: cultivating a hundred-year evergreen tree through greeninnovation

3Trees has set the positioning of its future development philosophyas cultivating a hundred-year evergreen tree through green innovation bysticking closely to the development philosophy of innovation, coordination,environmental friendliness, openness and sharing and combining with its owncharacteristics.

 

    To persist in green development means toadhere to the development model of resource

conservation, environmental protection andpeople orientation. For raw material selection, use materials with least damageto nature; for R&D, reduce formula costs constantly and decrease materialconsumption; to be people foremost, use healthy and environmentally friendlymaterials and improve personnel health during production and application ofcoating as well as people’s health in living after decoration; increaseinvestment in environmental protection facilities to guarantee zero emission ofnoxious gas, recycling of waste water and compliant treatment of solid wastesduring production process as much as possible; besides being environmentalfriendly themselves, manufactured products shall also have the functions ofenergy conservation, haze removal, self-cleaning and air purification; forpublic good, participate in green activities for public good to guide morepeople to pay attention to green, environmentally friendly and healthy lifestyle.

 

To persist in innovation-based development is to persist ininnovations in terms of culture, strategy, organization, system, R&D, management,model and mechanism in order to get adapted to the fast-changing externalmarket environment in the Internet age. First, maintain cultural advancement sothat culture can reflect the characteristics of the new age and new trends;second, starting from cultural innovation, push forward strategic innovationand organizational innovation; afterwards, with orientation in strategy, pushforward innovations in terms of business model, R&D, system, management andmechanism. Innovation never stops. All employees are encouraged to take theinitiative to offer advice and suggestion through reasonable suggestion platform,innovative intelligence and innovations to promote the enterprise to innovateand upgrade continuously.

 

To persist in cultivating a hundred-year evergreen tree is to adopta sustainable development concept. Long-term planning and goals are necessary,including mission, vision and development strategies. We need to run not onlyfast but also for a long time. We need to have the intuition that enables us toperceive market opportunities and threats keenly so that we can foreseeeverything for proper response. Use the method of continuous improvement andaccumulate small victories to achieve a great one so that we can cultivate ahundred-year evergreen tree.


5.Four drivers: talents × culture × brand × capital

3Trees put forward the four-driver model thinking of talents ×culture × brand × capital in 2007 and it has adhered to it to this day, whichhas boost the enterprise to achieve high-speed development.

 

Talents

Talents are fundamental to business operation and competition amongenterprises depends on talent competition. 3Trees’ practices in selecting,employing, developing and retaining talents reflect its strategy of persistingin creating a management elite echelon which highly recognizes 3Trees’corporate culture. 3Trees sticks to the team building thinking that takespriority in recruiting excellent university graduates for internal developmentand accepts external parachuting as a complementary approach; it persists inusing talents on grounds of their merit rather than by favoritism and withoutsticking to one pattern; it persists in implementing the PK eliminationmechanism in which high-potential people are used and uncreative people are eliminatedand able people come on the stage while weak people get off the stage; itadheres to the partnership mechanism of sharing with fighters and valuecreation-oriented assessment mechanism with full empowerment so as to allowfighting management talents to stand out who highly recognize 3Trees’ corporateculture and have high expertise and high ability to cope with pressure; itpersists in implementing the management and specialization double-approach mechanismso that each fighter has suitable promotion opportunities. 3Trees has achieved co-creationand sharing with fighters through equity incentive system, partner system,excess dividend system and 37 attractive remunerations and benefits as well asan extensive development platform.

 

Culture

3Trees upholds cultural guidance for strategies and it keepsupgrading and improving its cultural system continuously based on thecharacteristics of the times. It has established a culture promotion teamspecifically in order to spread culture in an all-round way among itsemployees, partners and users through a series of carriers of culture. 3Treesis going to set up a corporate culture college and aggressively builds theEnd-use Culture Marketing system targeted at its users and the culture spreadingsystem oriented towards the society and leading industries in order to convertcultural power into marketing strength.

 

Brand

A brand expresses an enterprise’s demand for core values and it isthe outward manifestation of corporate culture. 3Trees sticks to Health+ and itis committed to being the healthy paint brand which occupies the first place inusers’ mind. It adheres to the strategy of making all sub-brands become leadingbrands in the industry by creating a health brand profile, including “3Trees”as the parent brand, “ready-for-move-in” as the service brand, a greenengineering coating brand, a specialized furniture environmentally-friendlycoating brand and coating integrated service, etc.

 

With the implementation of such strategic initiatives as brandpositioning, brand vision, brand communication and brand operation, 3Trees hasbuilt a robust “brand culture muscle” and effectively enhanced its popularityand reputation among its audience, by which it eventually achieved continuous growthof performance and accumulated brand assets from the four dimensions: brandloyalty, brand awareness, perceived quality and brand association.

 

3Trees has guided consumers to uphold environmental friendlinessthrough communicating its core values of healthiness, naturalness andgreenness, and this allows consumers to express and shape their need forrealizing “ideal me – a healthy life” by virtue of the brand so that the brand,like an ID badge, helps consumers to show their values and life concept to thepeople around them. Everyone can be a health expert!

 

Capital

From September 27, 2007 on which 3Trees Paint Co., Ltd. wasincorporated to the listing in 2016, it took eight years for 3Trees to gopublic. Despite IPO suspension in 2012 and rigorous financial verification in2013, 3Trees became the only privately-run coating enterprise which survivedfrom the IPO windstorm in the end. On June 3, 2016, 3Trees got listed inA-share Main Board with Shanghai Stock Exchange and it became the first stockof civil-purpose coasting. 3Trees will move from product operation toindustrial and capital operation through capital links and achieve strategicexpansion quickly by means of capital operation, such as market value management,mergers and acquisitions, in order to create 3Trees into an ecologicalindustrial chain enterprise group featuring vertical integration and moderatehorizontal diversification.

 

6.Culture-based Marketing: leading dealers with culture and attracting users withculture

3Trees plants a tree in the mind of its employees, partners andusers respectively with ecological culture with an effort to build the mostmeaningful culture end use. Over the years, our corporate culture has releasedenergy in our business operation and management constantly, and this enablesour products to have rich cultural contents, our services to have highercultural taste, our operation to have highlighted cultural features and ourstrategies to have profound cultural foundation. Today, our corporate culturehas become the core endogenous power of sustainable development of 3Trees.

 

We are deeply aware of the meaning of playing mind games withculture at the end use. In recent years, 3Trees launched its long-planned newstrategy of culture-based marketing in an all-round way. 3Trees leads itsdealers with culture. It takes the initiative to create an end use culture-basedmarketing system targeted at dealers and users and establishes asociety-oriented and industry-leading culture communication system. It attractsusers with culture. Users buy not only healthy products, but also the culturalconcept and healthy lifestyle implied by healthy products and services.

 

7.R&D philosophy: ultimate performance and application for ultimate health

Heath is endless while innovation never stops. Innovation is thesoul of 3Trees. The core of product differentiation competition of 3Trees liesin the difference of R&D philosophy. Based on users’ needs and China’sactual conditions, 3Trees satisfies the inner needs for healthy living of peopleand healthy painting for construction foremen with ultimate health performanceand delivers the health performance higher than international advancedstandards and in a safe lead ahead of its competitors. Besides, other featuresare not lower than international advanced standards, such as hiding rate,spreading rate and ease of blending. Moreover, full consideration is given toconstruction convenience and efficiency to ensure extremely easy and quickconstruction. 3Trees was born with innovation DNA. Based on the aforementionedphilosophy, 3Trees has formed the innovation mindset of making breakthroughsevery day in order to be one step ahead of others and the technologicalinnovation pace featuring one generation in production, the second generationin R&D and the third generation in reserve. In addition, it has created ascientific innovation management method which conforms to its developmentduring constant iteration and it has gradually developed a series of innovationmanagement systems, including intellectual property management, technologicalinnovation management, product innovation management and innovation incentivepolicies. This has greatly improved product R&D efficiency.

 

So far, 3Trees has achieved the highest level in the industry interms of health-oriented functions with the concept of ultimate health. It hasset the Health+ new industrial standards and worked out its exclusive method tomeasure the time for odor to evanish, aiming to promote green standard in anall-round way. 3Trees has developed its special Health+ product line. Besides,we also focus on the process of product use in pursuit of ultimate productperformance. We control the entire process from raw material selection toconstruction with our products in order to make sure that health is guaranteedfrom the source and to ensure convenient and environmentally friendly coatingprocess and healthy and comfortable living after decoration.

 

In the future, we will continue to lead industrial trends and be thehealth pacesetter of the coating industry.

 

8.Production philosophy: green and intelligent manufacturing with lean production

3Trees attaches great importance to not only green andenvironmentally friendly R&D and production philosophies of productsthemselves, but also the greenness and environmental friendliness of allsections of the entire supply chain and processes in order to ensure compliancewith requirements of ecological supply chain. In strict compliance with staterequirements for environmental protection, 3Trees uses the most advancedenvironmentally friendly facilities in the world, strengthens environmentalprotection education and examination and guarantees no increased burden on thesociety and surrounding areas of the factory site through scientific emissionof exhaust gas, waste water and a wide range of wastes in order to achievefull-process green manufacturing. 3Trees only chooses the suppliers/partnerswhich are qualified for state requirements for environmental protection toensure greenness, environmental friendliness and low energy consumption as wellas compliance with laws and regulations of production and delivery through thesupply chain. We need intelligent manufacturing systems and technologies forsupport and the thought of lean production for guidance when we pursue optimalcost effectiveness and timeliness of supply of goods on the basis of improvingour product competitiveness and guaranteeing premium quality. To that end,3Trees makes full use of modern information technology (SAP) and automationtechnology (MES); by following C2M requirements and relying on big datamanagement platforms for information support, it creates scientific productionmodels and builds an information-oriented, intelligence-based and visualized supplychain management platform for data-oriented and intelligence-based treatment ofinformation about supplies, manufacturing and selling in the process ofproduction in order to achieve rapid, effective and individualized productsupply. 3Trees builds its intelligent ecological supply chain featuring largequantity, high speed, excellent quality and cost effectiveness through creatingintelligent factories and intelligent production applications as well asreasonable deployment of multiple production bases, cooperative factories anddistribution centers for regional warehouses across China. Besides, it achieveslean production and intelligent manufacturing in an intelligence-based way todevelop one-stop solutions for products and services. Infinite improvementleads to endless satisfaction.

 

9.361° service philosophy: 1° higher than satisfaction and beyond customers’expectations

3Trees not only carries craftsman spirits over to its products, butalso creates the 361° delight service system for its customers and users withcraftsman spirits as the system’s core element.

 

3Trees provides standardized, normalized and process-based delightservices for its customers through improving 6 service systems – projectservice system, sample room and sample paint service system, order servicesystem, logistics service system, application technology service system andfunctional groups service system by centering on its service tenet ofsurpassing customers’ expectations.

 

By integrating coating construction resources, 3Trees establishesthe quick response mechanism with 28-node strict control from constructionpreparations for site entry, whole construction process and constructionacceptance, builds the most advanced, comprehensive and practical constructionstandardization system in the industry and creates the 361° service platform forengineering coating and industrial wood ware paint coating. 3Trees implementsthe accountability system. Whoever receives inquiry or complaints fromcustomers, he/she shall be the first person responsible for reception andhe/she shall be in charge of giving guidance for resolve problems. In 2016,3Trees set up the Customer Service Center which provided unified and specializedintegration management of customer service functions which were originally distributedacross business units. The Center provides quality services for customers in coordinationwith service resources of all departments of the company. By providing suchfeatures as information inquiry, information consultation, trading services,business acceptance, complaints and suggestion, market survey and marketing forcustomers through the hotline beginning with 400, official website, OA, WeChatand other multi-media channels, it creates excellent experience for customers,improves customers’ satisfaction and loyalty, safeguards 3Trees’ health imageand reputation and gains competitive advantages for 3Trees. By virtue of this,3Trees provides 361° ultimate delight services featuring 1° higher thansatisfaction and develops the consummate reputation of delighting numerousfamilies by serving one household.

 

10.Marketingphilosophy: intensive cultivation; winning end use is fundamental to dealerprofitability while dealer profitability is the guarantee for 3Trees’ survival

Dealers are the bridge connecting 3Trees and its users; withoutthem, 3Trees will lose the guarantee for its survival and development.Profitability is the foundation of dealers’ survival and development. Only whenthe dealers joining 3Trees have higher profitability and more promising prospectsthan joining 3Trees’ competitors can 3Trees attract them to stay and have moreexcellent dealers continuously. 3Trees and its dealers are in an equal andinteractive community with win-win and mutual benefits in which they sharebusiness, interests and destiny.

 

The foundation of dealer profitability is to uphold 3Trees’ mission,vision, spirits, values and development strategies. When they share a commongoal with 3Trees, they can seek mutual cause together with 3Trees. 3Trees guidesand trains its dealers to establish corporate culture, development planning andbusiness management models and passes the Tao of everlasting development that3Trees has concluded on to its dealers, aiming to seek mutual development with them.3Trees supports its dealers’ development by adhering to the concept of allowingno dealers to suffer loss, being proud of dealers’ making money and beingashamed of dealers’ losing money. 3Trees encourages the exploration into allkinds of co-creation and sharing models which are beneficial to dealers’development, such as market funds, equity cooperation, valuation adjustment mechanism,resource swap, provincial and regional-level manager joint-stock operation andstore joint-stock system-oriented reform.

 

3Trees’ all value comes from its users. Everything in enterprisedevelopment is user-centric. The foundation of survival and development of3Trees and its dealers is to provide excellent services to their userstogether. Therefore, winning end use is fundamental to dealer profitability.

 

In the field of decoration paint, high-end, intelligent and greenexperience stores are built by centering on user’s best shopping experience toprovide one-stop product solutions, service integration and whole-housecustomization business; profitability of each store is enhanced; unrivaledchannels are built in cities and towns through self-fission of stores byfollowing the concept of “I exist because users exist” and models likepromotion in residential communities are used so that users can perceive andaccept 3Trees’ philosophies and products; strong Internet-based marketingchannels are created to occupy the online brand commanding height and provideonline traffic services for dealers and stores through big data and precisionmarketing while trying new retail models.


In the field of engineering paint, by centering on providingenergy-conservation, environmental-protection and ease-of-use products forarchitecture, 3Trees innovates products and the construction service systemwhich integrates systematic coating, heat preservation and water proof andbuilds the supply model of rapid delivery of samples and products to increasesuccess rate of project implementation; it keeps developing top 100 real estatecompanies and top 100 dealers to create a multi-level dealer channel network;it establishes real estate and public construction project database to providemore sources of real estate and public construction projects for dealers.

 

water-borne paint and UV paint as its featured products and focuseson customization and onsite quick and specialized services with majorbreakthroughs in top 100 furniture manufacturers. It builds a green andspecialized brand in the furniture paint market and drives promotion in the furniturepaint market through using the experience of selected units to promote work inthe entire area in order to provide a brand and service platform for dealers.

 

Only by satisfying users’ needs and providing delight servicesbeyond users’ expectations to capture their heart and word of mouth throughintensive cultivation can 3Trees increase users continuously and provide growthimpetus for the development of itself and its dealers. Winning end use isfundamental to dealer profitability while dealer profitability is the guaranteeof 3Trees’survival.


11.Internationalizationphilosophy: global cooperation by going global and bring in

Internationalization” has become anInternet hot word in the manufacturing industry in China. As Chinese brandsgrow in strength, internationalization has become the only sure way and it is acommon practice of many enterprises to utilize resources and opportunitiesthrough cooperation.

 

(1) Global benchmarkingand global technologies

3Trees has hired McKinsey & Company, Trout & Partners Ltd.,IBM, SAP and other global consultation companies to plan its globalizationstrategies.

 

3Trees has introduced in advanced coatings and coating technologiesfrom Europe and the United States through merger and acquisition, cooperation,joint venture, etc., especially the products of high-end brands and in the highadded value field, to create distinct layers of brands and products and achievefull presence in Chinese markets with its strength in terms of culture, product,channel, service and management.

 

With global benchmarking, 3Trees employs talents around the globe.By benchmarking various indicators of global advanced enterprises, 3Treespersists in learning from, paying visits to and conducting exploratory investigationon the most advanced enterprises and coating enterprises in the world for manytimes every year in order to build a world-class talent highland. 3Trees hiresthe Nobel Prize winner in chemistry serve as its technological advisor andmembers of coating associations of countries and regions and executives fromworld top 500 chemical enterprises to serve as its business advisors.

 

(2) 3Trees’ products,global markets

3Trees’ original functional products and the success that it hasmade in Chinese markets will impose influence on global coating industry.3Trees will participate more in world coating summit forum and a wide range ofevents to make more voices using world platforms and demonstrate its strengthand charm so as to improve its influence in the global stage. 3Trees willestablish the International Business Unit to promote brand building and marketexpansion across the world (mainly in Southeast Asian markets in the earlystage) and after becoming mature, this model will be reproduced and popularized;it will open high-end markets in Europe and the United States with its originalproducts.

 

(3) Chinese brand, worldcoating

As a Chinese brand, 3Trees will benefit the whole world with itscoatings through the above-mentioned strategy of bringing in and going global.Besides selling products to the rest of the world, 3Trees will also buildproduction bases around the globe or merge or acquire foreign enterprises inorder to popularize 3Trees’ brand and culture.

 

12.Three-strengthphilosophy: leadership, management strength and business strength

Do nothing that goes against nature and teach by personal example.3Trees attaches great importance to talent development. On one hand, it buildsa no-ceiling and borderless growth platform for employees and on the otherhand, it requires them to focus on self-improvement and self-development toachieve rapid growth. Aiming to set talent standards and position competence requirementsin a better way, 3Trees put forward the three-strength competence model for employeescreatively in 2014. Focusing on leadership, management strength and businessstrength, this model defines explicit standards and detailed requirements forthe competence of people at all levels and positions and serves as referencefor evaluation by higher authorities on a regular basis. It is hoped that eachone of us, with reference to the model, improve our leadership, management strengthand business strength by keeping improving ourselves through constant trainingsand self-learning with a strong desire of learning and knowledge so as tosatisfy job needs and realize qualitative leap.


13.At3Trees, the enterprise is the ship, culture is its sails and Party building isits helm.

We took theinitiative to drive the building of the Chinese Communist Party (“Party”), the CommunistYouth League (“League”) and trade unions internally at the beginning of thefounding of 3Trees. We established a branch of the Party in 2002 when ourcompany was still called Sanjiang Chemistry. In 2013, it was upgraded as aParty Committee and now it is in charge of four branches: Operation Center,Marketing Center, Logistics Center and 3Trees Sichuan. Over the past 15 years,the number of Party members in 3Trees has increased from 12 in the early periodof founding to 321 today through absorption, cultivation and development.3Trees has brought new blood into the Party Committee and maintained vitalityand energy of the Party team continuously.

 

Following theconcept that at 3Trees, the enterprise is the ship, culture is its sails andParty building is its helm, 3Trees Party Committee always pushes forwardgrass-roots Party building efforts with new thinking and in new approaches andtakes the initiative to identify the joint point at which Party buildingefforts lead us to develop. We bring in Party building elements and innovateParty building media to create the specialty brand of Paint Brilliance PartyBuilding. By relying on the “three-three” Party building work mechanism (amanagement model in which administrative organization, Party organization andtrade union organization form the three organizations in a three-levelstructure and three systems), we give full play to Party organization’s role asa stronghold and Party member’s exemplary role as vanguards and achieve win-winresults of both enterprise Party building and enterprise development at 3Trees.

 

3Trees attachesgreat importance to investment in enterprise Party building in all aspects. It spendsmore than RMB one million in enterprise Party building work on average everyyear and provides full guarantee in all aspects, such as people, funds andvenues. We also meet the availability criteria in terms of venues, facilities,signs, Party flags, books and newspaper, systems, funds, activities andassessment in setting up activity rooms for the Party, the League and trade unions.We have been awarded many honors in successively in recent years, includingAdvanced Grass-roots Party Organization in Fujian Province, 10 Best ExemplarySites for Party Building in Putian City, National Worker Vanguard Unit,National Advanced Unit for Corporate Culture Building, Certificate of Merit onLabor Day in Fujian Province and Fujian Province Worker Vanguard Unit.

 

14.Eightrules of leading teams

    1. Practice and take the initiative to spread3Trees’ corporate

culture,core values and cultural philosophy

    (1) Highly recognize our corporate mission,vision, spirits, core values and basic

concepts;

   (2) Comprehend and practice corporate culture and spirits carefully and

spread positive energy inside the team;

   (3) Take the initiative to forward our company’s information throughvarious

channels and motivate team members tospread it.

2. Communicate various meeting spirits of our companyto the team and break down goals

(1) Organizemeetings to interpret our company’s various meeting representations, understandour company’s spirits and study meeting contents;

(2) Set goalsbased on our company’s strategies and break them down into individuals’objectives to guarantee plan continuation;

(3) Examine andverify execution towards team goals, team members’individual action plans andmeeting minutes.

3. Be fair and impartial and play an exemplary role inproviding equal opportunities to employees

(1) Abide by ourcompany’s principles of seven “eliminations” and “establishments” and serveeach employee in a fair and impartial way;

(2) Persist infair and impartial management by keeping strictly the rules for reward andpunishment and doing business according to company systems so as to becomereliable backing for employees when they are progressing;

(3) Payattention to each employee’s growth without creating any faction or seeking forpersonal privileges.

 

4. Advocate the culture ofplain living and hard working as well as lifelong learning

(1) Become a fighter role model and uphold the happy-work mindset ofworking unconventionally;

(2) Practice what one advocates and set an example of reading; shareinsights on reading in the department’s WeChat friend circle on a regularbasis;

(3) Require each team member to read at least one book per month andorganize internal sharing;

(4) Organize at least one session of business trainings every month.

 

5. Care about employees’career planning, especially the growth of fighters

(1) Understand employees’ ideas about their career, assist them indetermining career planning and help them to realize their short-term careerplans in work;

(2) Make succession plans and make training plans for fighters thatlast at least one year;

(3) Implement the system of rotating directors and managers and giveguidance for the director or manager on duty to help them grow;

(4) Arrange at least one job for a fighter which is at the levelhigher than the fighter’s current abilities and follow up the job and give guidancefor the fighter each week;

(5) Give business guidance to subordinates for more than twice everymonth;

(6) Give preferential considerations in favor of fighters in annualselection of outstanding employees and in terms of pay raise and other benefits

 

6. Communicate withsubordinates directly on a regular basis

(1) Spend more than 50% of time in communicating and exchange ideaswith subordinates;

(2) Guarantee in-depth communication with each employee for at leastone time per month;

(3) Guarantee communication with new recruits for at least one timeper week and assist them in getting blended into the team quickly;

(4) Post at least 3 messages in the work group every week toguarantee vitality of the work group.

 

7. Hold “five meetings” ofour company

(1) A small meeting every day (morning meeting);

(2) A regular meeting every week (weekly meeting);

(3) A monthly meeting for once a month (monthly meeting);

(4) Monthly performance communication meeting;

(5) Monthly employee birthday party.

 

8. Really pay attention toemployees’ health and safety and eliminate their worries about their familiesto ensure that they can work with a relieved mind

(1) Organize team activities once a month which can be combined withthe birthday party to enhance team cohesion;

(2) Care about each employee’s health and safety and publicize andimplement safety education in departmental meetings on an irregular basis toraise risk awareness;

(3) Take the initiative to care about employees’ family conditionsand pay attention to education of employees’ children, marriage issues ofmarriageable employees, etc.;

(4) Carry out home visit activities on an irregular basis.

 

15.Spendno extra dime

As enterprisesize increases, 3Trees faces more fierce cost performance competition withother enterprises. Besides, its multi-factory, multi-brand and multi-categoryoperation has become more complex and this extensive management will lead torapid increase of costs. Furthermore, after 3Trees got listed, the capitalmarket focuses more on high-quality growth and sustainable growth of profits.Therefore, 3Trees will move from extensive management to lean operation. Eachone of us is required to have the awareness of being a partner of 3Trees. Weshall have the concept of spending no extra dime and the idea of avoiding moneyspending in the things unrelated to our strategies or operation and doing morewith less. Management shall be meticulous and specific to each user, store,customer, product, employee and spending. We shall advance the building ofintelligent lean operation system, amoeba organization and the co-creation andincentive-sharing mechanism. Besides, we shall create the atmosphere in whicheveryone participates in cost control and everyone is responsible for operationresults so that each dime spent will generate maximum returns. Every one of usis held accountable for our users, teams and shareholders.

 

16.Irondisciplines

Nothing can be accomplished without norms or standards. Managementis solemn love. At 3Trees, we require loving care and emphasize rigid systems,too. In the process of development, 3Trees has formulated several thousands ofsystem processes based on intelligent office and standardized operations bycentering on its corporate mission, vision, spirits and core values, persistingin management reform and sticking to the thought of excellent performancemanagement under the guidance of state laws and regulations. They have improved3tree’s comprehensive governance and fostered the iron-discipline systemculture of 3Trees.

 

Never touch the boiling water. One will get severely punishedwithout mercy if he/she touches the red line of disciplines. Everyone is equalbefore the discipline and there is no exception or discrimination, even thechairman. Disciplines cannot have any weakness. They are the net of justice formanagement and they ensure rigor and no omission of management. Systems aremerciless and computers are heartless, but humans are affectionate, so we shallcomply with systems rather than humans and trust computers rather than what ishumanly possible. These are the consensus on compliance with systems reached by3Trees people.

 

17.Motherlycare

The sage doesnot accumulate (for himself). The more that he expends for others, the moredoes he possess of his own; the more that he gives to others, the more does hehave himself.

 

Benefits consistof happiness and interests. Happiness is more about mental experience whileinterests generally refer to material satisfaction. 3Trees is a warm and bigfamily. We consider employees, partners and users as our family members. Ourmotherly care for our family members reflects humanity in 3Trees’ material caresystem.

 

3Trees not onlyprovides a cause for all of its employees for which they can fight in all theirlives, but also gives competitive remunerations and benefits as well as asecurity and aid system. Besides, it also extends social insurances and housingprovident fund to employees’ basic necessities of life, weddings and funerals,studies and trainings. We have established the Worry-free Fund with the promisethat when our employees’ families suffer from a severe misfortune orunconquerable difficulty, the Fund will assist in solving it. The Fund,together with Ten Health Clubs, Lychee Cultural Festival, Traveling Abroad andother cultural events, forms the 360° Motherly Care system. We even extend therange of our benefits to our partners and user groups. Our efforts in creating themost beautiful enterprise, building a green brand, providing worry-free careand establishing a growth platform interpret the definition of a happyenterprise. 

 

 

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