Note 10 – 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 June 30, 2016 and 2015, net sales to one of our distributors, which sells directly to three of our customers, accounted for 22% of our net sales. For the three months ended June 30, 2016, no customer accounted for more than 10% of our net sales, while one customer accounted for more than 10% of our net sales during the same period in 2015.

For the six months ended June 30, 2016 and 2015, net sales to one of our distributors which sells directly to three of our customers, accounted for 21% of our net sales. For the six months ended June 30, 2016 no customer accounted for more than 10% of our net sales, while for the same period in 2015, one customer accounted for 11% of our net sales.

Major Suppliers—The Company purchased approximately 22% of its raw materials from one vendor during the three and six months ended June 30, 2016, and approximately 48% and 49% from three vendors during the three and six months ended June 30, 2015. Each of the respective vendors was over 10% of our purchased raw materials during the respective period.

The Company purchased approximately 87% and 79% of its packaging material from three vendors during the three and six months ended June 30, 2016, and 68% and 71% of its packaging material from three vendors during the three and six months ended June 30, 2015. Each of the respective vendors was over 10% of our purchased packaging material during the respective period.

The Company also purchased approximately 86% and 87% of its treats finished goods from four vendors for the three and six months ended June 30, 2016, and approximately 97% and 95% from three vendors for the three and six months ended June 30, 2015. Each of the respective vendors was over 10% of our purchased treats finished goods during the respective period.

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

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2016		2015		2016		2015
Grocery, Mass and Club	$	25,878,388	$	21,629,868	$	50,033,099	$	42,113,913
Pet Specialty, Natural and Other		7,123,821		6,729,536		14,422,811		13,300,165
Net Sales	$	33,002,209	$	28,359,404	$	64,455,910	$	55,414,078