XML 17 R7.htm IDEA: XBRL DOCUMENT v3.20.2
Note 2 - Revenue Recognition
 3 Months Ended
Jun. 30, 2020
Notes to Financial Statements  
Revenue from Contract with Customer [Text Block]

Note 2: Revenue Recognition

 

The Company generates revenue by selling pet medication products and pet supplies. Certain pet supplies offered on the Company’s website are drop shipped to customers. The Company considers itself the principal in the arrangement because the Company controls the specified good before it is transferred to the customer. Revenue contracts contain one performance obligation, which is delivery of the product; customer care and support is deemed not to be a material right to the contract. The transaction price is adjusted at the date of sale for any applicable sales discounts and an estimate of product returns, which are estimated based on historical patterns, however it is not considered a key judgment. There are no amounts excluded from the variable consideration. Revenue is recognized when control transfers to the customer at the point in time in which the shipment of the product occurs. This key judgment is determined as the shipping point which represents the point in time in which the Company has a present right to payment, title has transferred to the customer, and the customer has assumed the risks and rewards of ownership. Outbound shipping and handling fees are an accounting policy election, and are included in sales as the Company considers itself the principal in the arrangement given its responsibility for supplier selection and discretion over pricing. Shipping costs associated with outbound freight after control over a product has transferred to a customer are an accounting policy election and are accounted for as fulfillment costs and are included in cost of sales.

 

The Company disaggregates revenue in the following two categories: (1) reorder revenue vs new order revenue, and (2) internet revenue vs. contact center revenue. The following table illustrates revenue by various classifications:

 

Three Months Ended June 30,

  

Revenue (In thousands)

  

2020

    

%

    

2019

    

%

    

$ Variance

    

% Variance

  
                                                 

Reorder Sales

   $ 80,425       83.6 %   $ 67,742       84.7 %   $ 12,683       18.7 %

New Order Sales

     15,779       16.4 %     12,246       15.3 %     3,533       28.9 %
                                                 

Total Net Sales

   $ 96,204       100.0 %   $ 79,988       100.0 %   $ 16,216       20.3 %
                                                 

Internet Sales

   $ 81,511       84.7 %   $ 67,023       83.8 %   $ 14,488       21.6 %

Contact Center Sales

     14,693       15.3 %     12,965       16.2 %     1,728       13.3 %
                                                 

Total Net Sales

   $ 96,204       100.0 %   $ 79,988       100.0 %   $ 16,216       20.3 %

 

The majority of the Company’s sales are paid by credit cards and the Company usually receives the cash settlement in two to three banking days. Credit card sales minimize the accounts receivable balances relative to sales. The Company had no material contract asset or liability balances as of June 30, 2020 or March 31, 2020.