Concentration

9 Months Ended

Mar. 31, 2015

Concentration

Concentration

3. Concentration

Customers

For the three and nine months ended March 31, 2015, our Company earned net revenues of $985,679 and $1,530,248 respectively. The vast majority of these revenues were derived from a large number of customers. A significant percentage of the revenues and accounts receivable relate to one customer of the Company, which is SWC’s customer. This customer accounted for 29% and 23% of revenues for the three and nine months ended March 31, 2015, respectively.

For the three and nine months ended March 31, 2014, our Company earned net revenues of $3,025 and $73,776, respectively. A significant portion of our Company's revenue is derived from a small number of customers. For the three months ended March 31, 2014, sales to one of the Company's customers accounted for 100% of net sales. For the nine months ended March 31, 2014, sales to one of the Company's customers accounted for more than 75% of net sales. The revenues only reflect prior to the acquisition of SWC, and were revenues from Sugarmade, Inc.

Suppliers

For the three months and nine months ended March 31, 2015, we purchased products for sale by CarryOutSupplies from several contract manufacturers located in Asia. A substantial portion of the Company’s inventory is purchased from one supplier that functions as an independent foreign procurement agent. Two suppliers accounted for 54% and 18% of the Company’s total inventory purchase in the three months ended March 31, 2015, respectively. These two suppliers accounted for 60% and 15% of the Company’s total inventory purchase in the nine months ended March 31, 2015, respectively.

For the three and nine month periods ended March 31, 2014, all of our tree free paper products were purchased from one supplier and its contract manufacturers.