Next row: (RS). K1. yo. P3tog. *P1. K1. Rep from * to last 5 sts. P1. P3tog. yo. K1.
This is the first row of the decreases. If you note the pattern says Knit 1 and then yarn over before you Purl 3 together. the YO makes 1 stitch and purling 3 together makes 1 more stitch for a total of 2 stitches therefore you have only decreased 1 stitch. The reason for doing it this way, is that you will still have an eyelet border as you decrease. Just remember to do the yarn over before purling 3 together.