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Concentration of Risk
 6 Months Ended
Dec. 31, 2025
Risks and Uncertainties [Abstract]  
Concentration of Risk

Note 16 - Concentration of Risk

 

Credit risk

 

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable.

 

As of December 31, 2025 and June 30, 2025, $2,011,738 and $2,007,890, respectively, were deposited with various financial institutions and financial services companies in the United States and PRC. Accounts at each institution in the United States are insured by the Federal Deposit Insurance Corporation (FDIC) for up to $250,000. The Company had approximately $1.5 million and $1.4 million, respectively, in excess of the FDIC insurance limit, as of December 31, 2025 and June 30, 2025.

 

Accounts receivable are typically unsecured and derived from revenue earned from customers, thereby exposing the Company to credit risk. The risk is mitigated by the Company’s assessment of its customers’ creditworthiness and its ongoing monitoring of outstanding balances. The Company maintains reserves for estimated credit losses, and such losses have generally been within expectations.

 

The business of WFOE in China may be impacted by Chinese economic conditions, changes in regulations and laws, and other uncertainties.

 

Customer and vendor concentration risk

 

For the six months ended December 31, 2025 and 2024, Amazon Vendor and Amazon Seller customers accounted for 75% and 91% of the Company's total revenues, respectively. As of December 31, 2025 and June 30, 2025, respectively, accounts receivable from Amazon Vendor and Amazon Seller accounted for 78% and 72% of the Company’s total accounts receivable.

 

For the six months ended December 31, 2025 and 2024, one supplier accounted for 64% and 8% of the Company's total purchases, respectively. As of December 31, 2025 and June 30, 2025, accounts payable to one supplier accounted for 21% and 10% of the Company’s total accounts payable.