Quarterly report pursuant to Section 13 or 15(d)

Note 12 - Concentrations

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Note 12 - Concentrations
9 Months Ended
Sep. 30, 2020
Notes to Financial Statements  
Concentration Risk Disclosure [Text Block]
NOTE
12
 -- CONCENTRATIONS
 
Milestone Scientific has informal arrangements with
third
-party manufacturers of the STA, epidural, and intra-articular devices, pursuant to which they manufacture these products under specific purchase orders but without any long-term contract or minimum purchase commitment. Consequently, advances on contracts have been classified as current on
September 30, 2020 
and
December 31, 2019. 
The termination of the manufacturing relationship with any of these manufacturers could have a material adverse effect on Milestone Scientific's ability to produce and sell its products. Although alternate sources of supply exist, and new manufacturing relationships could be established, Milestone Scientific would need to recover its existing tools or have new tools produced. Establishment of new manufacturing relationships could involve significant expense and delay. Any curtailment or interruption of the supply, because of termination of such a relationship, would have a material adverse effect on Milestone Scientific's financial condition, business, and results of operations.             
 
For the
three
and
nine
months ended
September 30, 2020,
approximately
40%
and
45%
 of the Company's net product sales were from the Company's exclusive domestic dental distributor, respectively. For the
three
and
nine
months ended
September 30, 2019
net product sales were
54%
and
51%,
respectively, to the Company's exclusive domestic dental distributor. Accounts receivable for
two
 customers/distributors amounted to approximately
$720,000
 or
74%
,
or
60%
 and
14%
of Milestone Scientific's gross accounts receivable as of
September 30, 2020,
one
of which was the Company's exclusive domestic dental distributor.     Accounts receivable for the Company's exclusive domestic dental distributor amounted to approximately or
77%,
of Milestone Scientific's gross accounts receivable as of
December 31, 2019.
The Company's exclusive domestic dental distributor exclusivity for the domestic dental market is subject to annual purchase requirements and other requirements, as defined in the agreement.
 
The COVID-
19
pandemic affected the Company's operations in the
second
quarter and
third
quarter and
may
continue to do so indefinitely thereafter. The Company is continuously monitoring its own operations and intends to take appropriate actions to mitigate the risks arising from the COVID-
19
pandemic to the best of its abilities, but there can be
no
assurances that the Company will be successful in doing so. To the extent the Company is able to obtain information about and maintain communications with its customers, suppliers, vendors, and other business partners, the Company will seek to minimize disruptions to its supply chain and distribution channels, but many circumstances will be beyond the Company's control. Governmental action
may
further cause the Company to temporarily close its facilities and/or regional quarantines
may
result in labor shortages and work stoppages. All of these factors
may
have far reaching direct and indirect impacts on the Company's business, operations, and financial results and condition. The ultimate extent of the effects of the COVID-
19
pandemic on the Company is highly uncertain and will depend on future developments which cannot be predicted.