Although single crystalline SnSe has high thermoelectric figure of merit ZT, the highest ZT reported for polycrystalline SnSe-based material is not larger than 1. Here we show that a record value of ZT = 1.26 at 880 K is achieved for polycrystalline SnSe based composites with PbTe nanoinclusions. Our results indicate that the high performance arises from simultaneous increase in power factor and thermal resistance. The increased power factor mainly originates from enhanced electrical conductivity due to increased carrier concentration; while the large (similar to 25%) reduction of thermal conductivity can be ascribed to both the interface scattering of phonons and inhibition of bipolar effect. Present result demonstrates that the introduction of proper nanoinclusions can effectively elevate the thermoelectric performance of polycrystalline SnSe compound. (C) 2016 Elsevier Ltd. All rights reserved.