Note 16 – Concentrations

Major suppliers

The Company sourced approximately 62% of its inventory purchases from one vendor for the six months ended June 30, 2024. The Company sourced approximately 83% of its inventory purchases from three vendors for the six months ended June 30, 2023. As of June 30, 2024 and December 31, 2023, $5.1 million and $5.5 million of inventory purchases were in accounts payable on the Condensed Consolidated Balance Sheets, respectively.

Major customers

Accounts receivable from two customers represented 95% of accounts receivable as of June 30, 2024. Accounts receivable from two customers represented 79% of accounts receivable as of December 31, 2023. Three customers represented 74% of gross sales for the six months ended June 30, 2024. Three customers represented 60% of gross sales for the six months ended June 30, 2023.

Credit risk

As of June 30, 2024 and December 31, 2023, the Company’s cash and cash equivalents were deposited in accounts at several financial institutions and may maintain some balances in excess of federally insured limits. The Company maintains its cash and cash equivalents with high-quality, accredited financial institutions and, accordingly, such funds are subject to minimal credit risk. The Company has not experienced any losses historically in these accounts and believes it is not exposed to significant credit risk in its cash and cash equivalents.