Note 16 - Concentrations of Credit Risk

9 Months Ended

Sep. 30, 2024

Notes to Financial Statements

Concentration Risk Disclosure [Text Block]

16. Concentrations of Credit Risk

Customer concentration - Accounts receivable potentially exposes the Company to concentrations of credit risk. The Company monitors the amount of credit it allows each of its customers, using the customer’s prior payment history and its overall credit worthiness to determine how much credit to allow or whether credit should be given at all. It is the Company’s policy to discontinue shipments to any customer that is substantially past due on its payments. The Company sometimes requires payment in advance from customers whose payment record is questionable. As a result of its monitoring of the outstanding credit allowed for each customer, as well as the fact that the majority of the Company’s sales are to customers whose satisfactory credit and payment record has been established over a long period of time, the Company believes that its credit risk from accounts receivable is low.

For the three months ended September 30, 2024, one of the Company’s cosmetic ingredient distributors, and three of its pharmaceutical distributors, together accounted for 77% of the Company’s gross sales and 79% of its outstanding accounts receivable at September 30, 2024. During the three months ended September 30, 2023, the same cosmetic ingredient distributor and three pharmaceutical distributors together were responsible for 73% of the Company’s gross sales and 82% of its outstanding accounts receivable at September 30, 2023.

For the nine months ended September 30, 2024, one of the Company’s cosmetic ingredient distributors, and three of its pharmaceutical distributors, together accounted for 81% of the Company’s gross sales and 79% of its outstanding accounts receivable at September 30, 2024. During the nine months ended September 30, 2023, the same cosmetic ingredient distributor and three pharmaceutical distributors together were responsible for 73% of the Company’s gross sales and 82% of its outstanding accounts receivable at September 30, 2023.