China Electronics Holdings Inc. through its subsidiary, Guoying, is engaged in the wholesale and retail sale of consumer electronics and appliances in the People’s Republic of China (the PRC), such as solar heaters, refrigerators, air conditioners, televisions, and similar items. The Company distributes merchandise through company owned stores and to exclusive franchise stores and non-exclusive franchise stores. The merchandise it provides includes Guoying branded products as well as products from manufacturers such as Sony, Samsung and LG. As of December 31, 2013, it had 133 exclusive franchise stores operating under the Guoying brand name pursuant to cooperation agreements and 18 non-exclusive franchise stores to which it provides Guoying branded merchandise. The Company purchases consumer electronics and appliances from well-known manufacturers or distributors and sell them through company owned stores and to the exclusive franchise stores and non-exclusive stores.