SEGMENTING REPORTING

9 Months Ended

Sep. 30, 2023

Segment Reporting [Abstract]

SEGMENTING REPORTING

19. SEGMENTING REPORTING

The Company’s principal operating segments coincide with the types of products to be sold. The products from which revenues are derived are consistent with the reporting structure of the Company’s internal organization. The Company’s two reportable segments for the nine months ended September 30, 2023 were the Inventory Management Solutions segment and the Corrugated segment. The Company’s chief operating decision maker has been identified as the Chairman and CEO, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. Segment information is presented based upon the Company’s management organization structure as of September 30, 2023 and the distinctive nature of each segment. Future changes to this internal financial structure may result in changes to the reportable segments disclosed. There are no inter-segment revenue transactions and, therefore, revenues are only to external customers.

Segment operating profit is determined based upon internal performance measures used by the chief operating decision maker. The Company derives the segment results from its internal management reporting system. The accounting policies the Company uses to derive reportable segment results are the same as those used for external reporting purposes. Management measures the performance of each reportable segment based upon several metrics, including net revenues, gross profit and operating loss. Management uses these results to evaluate the performance of, and to assign resources to, each of the reportable segments. The Company manages certain operating expenses separately at the corporate level and does not allocate such expenses to the segments. Segment income from operations excludes interest income/expense and other income or expenses and income taxes according to how a particular reportable segment’s management is measured. Management does not consider impairment charges, and unallocated costs in measuring the performance of the reportable segments.

For the three and nine months ended September 30, 2022, the Company had only one operating segment (corrugated) thus segment info for this period is not presented. Segment information available with respect to these reportable business segments for the three and nine months ended September 30, 2023 was as follows:

	For the Three months Ended September 30,			For the Nine months Ended September 30,
	2023			2023
Revenues:
Inventory Management Solutions	$	20,732,505		$	53,545,749
Corrugated		2,602,083			6,225,707
Total segment and consolidated revenues	$	23,334,588		$	59,771,456
Cost of revenues:
Inventory Management Solutions	$	18,880,548		$	48,339,198
Corrugated		1,706,736			4,335,968
Total segment and consolidated cost of revenues	$	20,587,284		$	52,675,166
Gross profit:
Inventory Management Solutions	$	1,851,957		$	5,206,551
Corrugated		895,347			1,889,739
Total segment and consolidated gross profit	$	2,747,304		$	7,096,290
Income from operations:
Inventory Management Solutions	$	(254,543	)	$	(1,272,307	)
Corrugated		511,953			757,272
Corporate		(944,953	)		(6,466,943	)
Total segment and consolidated income from operations	$	(687,543	)	$	(6,981,978	)
Depreciation and amortization:
Inventory Management Solutions	$	574,643		$	1,735,389
Corrugated		49,495			148,488
Total segment and consolidated depreciation and amortization	$	624,138		$	1,883,877
Revenues by geography:
North America	$	4,183,248		$	11,243,620
Europe		19,151,340			48,527,836
Total geography and consolidated revenues	$	23,334,588		$	59,771,456
Segment capital expenditures:
Inventory Management Solutions				$	-
Corrugated					114,312
Corporate					-
Total segment and consolidated capital expenditures				$	114,312
Segment total assets:
Inventory Management Solutions				$	51,785,923
Corrugated					3,009,631
Corporate					5,490,894
Total segment and consolidated assets				$	60,286,448