Andrew Shapiro: Okay. And so this does not have a lot of dependence for overseas supply?
Sanjay Singh: It does have dependence on overseas supply.
Andrew Shapiro: One does. Okay. And touching on that issue, when your revenue shortfall problem is supply chain, it’s really the costly capital limitations on stockpiling inventory of long transit time product, long transit time product shipments. And frankly, at the rate of interest that our working capital line of credits on it to be gain better to get that inventory level down, converted, and get that costly working capital line of credit, which I’m happy mind you that we got a three-year duration on it, but to get that thing paid down because it’s not cheap, right? So, what’s the status of resolving supply issues and finding alternative sourcing preferably closer to the US? And have you achieved any success in onshoring more of the company’s supplier and logistics?
Sanjay Singh: A significant amount of time and resources were invested in securing this ABL. And to find a new supplier — domestic supplier would require upfront tooling costs, depending on the status of our existing tooling. So, I think the first thing we need to do here is increase our cash flow before we can look at moving that insure it is on our list, but we’re constrained at the moment to do that.
Andrew Shapiro: So, there’s a capital investment Mace have to undertake in order to shorten the supply line?
Sanjay Singh: Yes.
Andrew Shapiro: Okay. Just wanting to better understand that. You described in your Slide number 5 that a single current customer accounted for $170,000 or most of the sequential quarterly revenue decline in the retail segment. I think you made comments in your introductory script. Can you again expand on and provide what’s going on with this customer? And why should we or when should we expect this customer to return to former purchasing levels?
Sanjay Singh: So, this — we’ve had this customer for a long time. They are — they went with a different option. And they were seeking more renovation from us. They didn’t like our — the Pocket, the formerly Pocket introduction, they did not care for that. So, having received their feedback, the one that is being targeted for release in the first quarter of 2024, we think that that would be a pretty good candidate for this customer.
Andrew Shapiro: Have they given you feedback on this new product yet?
Sanjay Singh: No. They have not given feedback, but we have provided — we have been provided feedback from our sales rep who has talked to the buyer and that’s what I’m basing that on.
Andrew Shapiro: So, is this the same sales rep that thought the Pocket Hero was a good idea for AutoZone?
Sanjay Singh: No, the buyer liked it. It just — they placed it in a very different area than we expected. So, the sell-through initially was good. They moved into a different area and then the sell-through decline. So, I mean, the buyers blessed the product, that’s how that order got placed.
Andrew Shapiro: Okay. I have some more questions. I don’t want to dominate unless there’s no one in the queue. Either you can tell me whether that’s the case before I get — go out or I’ll go out and just let me back in. I got a few more.
Operator: This is the operator. There are no other questions in the queue.
Andrew Shapiro: All right. I will ask a few more here to get to my list. Let’s talk a little bit about some of the new business and new customer stuff, all right? I see the new dog leash with airhorn product is here, it’s arrived, and it’s being offered for sale on Mace.com. When did you start making sales? What’s been the response so far? And where and when will you offer the product beyond our e-commerce site?
Sanjay Singh: So, the product was on site probably a couple of months ago. And that’s when we started — we updated our website to reflect that. We have offered it to other retailers as well. And we — a regional retailer in the Cleveland area is very interested in carrying it. We are waiting for their purchase order. And then we are also offering it on our store on Amazon.
Andrew Shapiro: Okay. I went through today and I couldn’t find it. So, maybe I punched in the wrong prompts to find that. But it’s now being offered on your store in Amazon as well. And how have the sales proceeded on this product versus your expectations and inventory plans?
Sanjay Singh: It’s been slow, but that’s pretty typical with new products. We don’t get a significant amount of sessions online on Mace.com. So, we didn’t expect a significant amount of sales on Mace.com, but we do expect a significant amount of sales on our Amazon store. And that — the technical details of all of that was completed just in the last few weeks. So, it will take some time for the campaigns to kick-in and for the product to move.
