Note 12 – Concentrations:

Concentration of Credit Risk—The Company maintains its cash balances in financial institutions which are insured by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000 each. At times, such balances may be in excess of the FDIC insurance limit.

Major Customers—For the three months ended September 30, 2015 and 2014, net sales to one of our distributors, which sells directly to three of our customers, accounted for 21% of our net sales in both periods. For the three months ended September 30, 2015, one customer accounted for 11% of our net sales, while for the same period in 2014, no customer accounted for more than 10% of our net sales.

For the nine months ended September 30, 2015 and 2014, net sales to one of our distributors which sells directly to three of our customers, accounted for 21% and 22% of our net sales, respectively. For the nine months ended September 30, 2015 one customer accounted for 11% of our net sales, while for the same period in 2014, no customer accounted for more than 10% of our net sales.

Major Suppliers—The Company purchased approximately 24% of its raw materials from one vendor during the three months ended September 30, 2015 and 40% of its raw materials from three vendors during the nine months ended September 30, 2015, each of which individually make up 10% of the company’s raw material purchases. During the three and nine months ended months ended September 30, 2014 approximately 51% and 52% of its raw materials were from three vendors, each of which individually make up 10% of raw material purchases, during the respective period.

The Company also purchased approximately 86% and 92% of its treats finished goods from three vendors for the three and nine months ended September 30, 2015, each of which individually make up 10% of the Company’s purchased treats finished goods. The company purchased approximately 88% and 82% of its treats finished goods from two vendors for the three and nine months ended September 30, 2014 each of which individually make up 10% of the Company’s purchased treats finished goods.

The Company purchased approximately 69% and 70% of its packaging material from three vendors during the three and nine months ended September 30, 2015, each of which individually make up 10% of the Company’s purchased packaging material. The Company purchased approximately 82% and 75% of its packaging material from three vendors during the three and nine months ended September 30, 2014, each of which individually make up 10% of the Company’s purchased packaging material.

Net Sales By Class of Retail – The following table sets forth net sales by class of retail:

	Three months ended				Nine months ended
	September 30,				September 30,
	2015		2014		2015		2014
Grocery, Mass and Club	$	23,540,110	$	16,671,443	$	65,654,024	$	46,522,636
Pet Specialty, Natural and Other		7,030,396		5,848,229		20,330,559		15,733,271
Net Sales	$	30,570,506	$	22,519,672	$	85,984,583	$	62,255,907