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Note 6 - Segment Information and Concentrations

6 Months Ended

Jun. 30, 2020

NOTE 6 — Segment Information and Concentrations

Segment Information

The Company operates in the mobile barcode scanning and RFID/NFC data capture market. Mobile scanning typically consists of mobile devices such as smartphones or tablets, with mobile scanning or NFC peripherals for data collection, and third-party vertical applications software. The Company distributes its products in the United States and foreign countries primarily through distributors, resellers, and online. The Company markets its products primarily through application developers whose applications are designed to work with Company’s products.

Revenues for the geographic areas for three months ended June 30, 2020 and 2019 were as follows:

	Three Months Ended June 30,				Six Months Ended June 30,
	2020		2019		2020		2019
Revenues:
Americas	$	2,242,225	$	3,975,771	$	5,385,634	$	7,653,571
Europe		200,012		604,931		815,541		1,097,923
Asia Pacific		272,787		479,403		734,535		937,202
Total revenues	$	2,715,024	$	5,060,105	$	6,935,710	$	9,688,696

Export revenues are attributable to countries based on the location of the Company’s customers. The Company does not hold long-lived assets in foreign locations.

Major Customers

Customers who accounted for at least 10% of the Company’s total revenues for the three and six months ended June 30, 2020 and 2019 were as follows:

	Three Months Ended June 30,						Six Months Ended June 30,
	2020			2019			2020			2019
Ingram Micro Inc.		29	%		41	%		33	%		42	%
BlueStar, Inc.		25	%		18	%		20	%		19	%
ScanSource, Inc.		14	%		*			10	%		*

Concentration of Credit Risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk include cash, cash equivalents and accounts receivable. The Company invests its cash in demand deposit accounts in banks. To date, the Company has not experienced losses on the investments. The Company’s trade accounts receivables are primarily with distributors. The Company performs ongoing credit evaluations of its customers’ financial condition but generally requires no collateral. Reserves are maintained for potential credit losses, and such losses have been within management’s expectations. Customers who accounted for at least 10% of the Company’s accounts receivable balances at June 30, 2020 and December 31, 2019 were as follows:

	June 30,			December 31,
	2020			2019
Ingram Micro Inc.		31	%		49	%
BlueStar, Inc.		32	%		26	%
ScanSource, Inc.		21	%		*
*Customer accounted for less than 10% of the Company’s accounts receivable balances

Concentration of Suppliers

Several of the Company’s component parts are produced by a sole or limited number of suppliers. Shortages could occur in these essential materials due to increased demand, or to an interruption of supply. Suppliers may choose to restrict credit terms or require advance payments causing delays in the procurement of essential materials. If the Company were unable to procure certain of such materials, it could have a material adverse effect upon its results. At June 30, 2020, 38% of the Company’s accounts payable balances was concentrated in the top supplier. For the three months ended June 30, 2020, the top two suppliers accounted for 54% of the inventory purchases.