Her Imports (HHER) 10-Q 19 Nov 18 2018 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2018	Nov. 19, 2018
Document And Entity Information
Entity Registrant Name	Her Imports
Entity Central Index Key	1,402,453
Document Type	10-Q
Document Period End Date	Sep. 30, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Small Business Flag	true
Entity Emerging Growth Company	true
Entity Ex Transition Period	false
Entity Common Stock, Shares Outstanding		8,656,459
Trading Symbol	HHER
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2,018

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($)	Sep. 30, 2018	Dec. 31, 2017
Current assets
Cash	$ 156,789	$ 190,233
Receivables	180,397	165,770
Related party receivables	188,170	108,026
Inventories	1,651,137	2,335,753
Prepaid maintenance fees - current		75,000
Other prepaid expenses	12,818	64,923
Deposits	194,768	196,392
Total current assets	2,384,079	3,136,097
Property, Equipment and software, net	137,602	267,464
Prepaid maintenance fees - non-current		209,375
Other asset	25,000	25,000
Trademark	8,200,000	8,200,000
Total assets	10,746,681	11,837,936
Current liabilities
Accounts payable and accrued liabilities	679,350	822,216
Income tax liability		134,432
Notes payable	409,511	177,390
Total current liabilities	1,088,861	1,134,038
Total liabilities	1,088,861	1,134,038
Stockholders' equity
Callable $0.144 per share per year non-cumulative dividend liquidation preference of $2.00 per share, preferred stock, $0.001 par value, 10,000,000 shares authorized and 5,000,000 issued and outstanding as of September 30, 2018 and December 31, 2017, respectively	5,000	5,000
Common stock, $0.001 par value, 70,000,000 shares authorized, 8,656,459 and 4,150,059 shares issued and outstanding as of September 30, 2018 and December 31, 2017, respectively	8,656	4,150
Additional paid-in capital	30,143,703	26,679,777
Accumulated deficit	(20,499,539)	(15,985,029)
Total stockholders' equity	9,657,820	10,703,898
Total liabilities and stockholders' equity	$ 10,746,681	$ 11,837,936

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Sep. 30, 2018	Dec. 31, 2017
Statement of Financial Position [Abstract]
Preferred stock call price per share	$ 0.144	$ 0.144
Liquidation preference price per share	2	2
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	5,000,000	5,000,000
Preferred stock, shares outstanding	5,000,000	5,000,000
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	70,000,000	70,000,000
Common stock, shares issued	8,656,459	4,150,059
Common stock, shares outstanding	8,656,459	4,150,059

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Income Statement [Abstract]
Product sales	$ 2,794,480	$ 3,668,040	$ 9,212,572	$ 12,652,837
Cost of products sold	1,613,967	1,996,633	5,090,006	6,889,965
Gross profit	1,180,513	1,671,407	4,122,566	5,762,872
Operating expenses
Royalties	2,282	5,286	11,731	11,180
Selling expense	1,115,543	1,259,130	3,397,653	4,045,970
General and administrative expense	326,192	364,122	1,013,625	974,081
Total operating expenses	1,444,017	1,628,538	4,423,009	5,031,231
Income (loss) from operations	(263,504)	42,869	(300,443)	731,641
Other (expense) income
Interest income		1		70
Interest expense	(11,322)	(351)	(24,316)	(5,302)
Loss on abandonment of fixed assets		(2,162)	(384,454)	(2,162)
Contract termination expense - related party			(3,397,500)
Total other expense	(11,322)	(2,512)	(3,806,270)	(7,394)
Income (loss) before benefit (provision) for income taxes	(274,826)	40,356	(4,106,713)	724,247
Benefit (provision) for income taxes	38,316	76,760	132,203	(168,896)
Net income (loss) attributable to Company	(236,510)	117,116	(3,974,510)	555,351
Preferred stock dividends	(180,000)	(180,000)	(540,000)	(540,000)
Net loss to common stockholders	$ (416,510)	$ (62,844)	$ (4,514,510)	$ 15,351
Net basic income (loss) per share attributable to common stockholders: basic and diluted	$ (0.05)	$ (0.02)	$ (0.77)	$ 0.02
Weighted average number of common shares outstanding: basic and diluted	8,656,459	4,150,059	5,833,886	4,150,059

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
OPERATING ACTIVITIES
Net income (loss) attributable to Company	$ (3,974,510)	$ 555,351
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation and amortization	58,462	92,439
Stock-based compensation	70,932
Loss on abandonment of fixed assets	384,454	2,162
Contract termination expense	3,397,500
Changes in operating assets and liabilities:
Receivables	(14,627)	(91,113)
Related party receivables	(80,144)	(17,140)
Inventories	684,616	(182,203)
Prepaid maintenance fees		56,250
Other prepaid expenses	52,105	(30,365)
Deposits	1,624	(75,366)
Accounts payable and accrued liabilities	(142,866)	106,203
Income tax liability	(134,432)	165,213
Other asset		(25,000)
Net cash provided by operating activities	303,115	556,431
INVESTING ACTIVITIES
Purchase of fixed assets	(28,680)	(144,229)
Net cash used in investing activities	(28,680)	(144,229)
FINANCING ACTIVITIES
Issuance of notes payable	1,658,063
Repayment on notes payable	(1,425,942)	(43,805)
Payment of preferred dividend	(540,000)	(540,000)
Net cash used in financing activities	(307,879)	(583,805)
NET DECREASE IN CASH	(33,444)	(171,603)
CASH - BEGINNING OF PERIOD	190,233	355,568
CASH - END OF PERIOD	156,789	183,965
SUPPLEMENTAL DISCLOSURES:
Interest paid	24,317	5,539
Income taxes paid	3,502	4,337
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Shares issued in exhange of cancellation of MIP Agreement	$ 4,500

Description of the Company

Description of the Company	9 Months Ended
	Sep. 30, 2018
Accounting Policies [Abstract]
Description of the Company	1. Description of the Company Her Imports, (previously known as EZJR, Inc.), (“the Company” or “Her”), was incorporated on August 14, 2006 under the laws of the State of Nevada. Corporate Structure and Business Her is a retailer of Human Hair Extensions and related haircare and beauty products headquartered in Las Vegas, Nevada. The Company sells its products at consultation studios, on its Website, www.herimports.com and on Amazon.com. As of September 30, 2018, the Company operated 18 retail locations, all of which are in the U.S. These locations are primarily in “executive offices suites” such as Regus PLC, where furniture, administrative staff and security are provided. The Company then stocks the location with products and point-of-sale equipment. These locations are leased on a short-term basis (primarily one year or less). Five leases, including our corporate office, have leases longer than one year at the time they were entered into. This allows the Company to open and close its consultation studios within a short period of time at minimal expense to the Company. At the Company’s consultation studios, the customer is provided with a personal, one-on-one consultation with a Her beauty expert. Additionally, the Company has locations in Greenbelt, Maryland and Brooklyn, New York with salons where customers can have their hair purchases “installed.” The Company has one wholly owned subsidiary, Her Marketing Concepts, Inc. (“Her Marketing”), a Nevada corporation. All employees of the Company are employed by Her Marketing. Agreement with Cabello Real Ltd. On November 28, 2016, the Company entered into an Asset Share Purchase & Business Agreement with Cabello Real Ltd. (“Cabello”), a private United Arab Emirates company to acquire the exclusive U.S. rights to the Her Imports trademark. In addition to these rights, the Company also purchased certain other assets owned by Cabello including customer lists and various digital content. In exchange for these rights, and other digital assets, the Company issued to Cabello 10,000,000 shares of non-voting, non-cumulative, callable preferred stock (subsequently revised to 5,000,000) with a dividend rate of $0.144 per share per annum and a liquidation preference of $2.00 per share. In addition, the Cabello received 1,250,000 shares of common stock. Both the preferred stock and common stock issued were unregistered. Additionally, the Company filed with the Secretary of State of Nevada for the approval of the Certificate of Designations, Preferences, and Rights of Callable Non-cumulative Preferred Stock. The Certificate designated 5,000,000 as Callable Non-cumulative Preferred Stock at a par value of $.001 per share. Cabello is controlled by Mr. Johnathan Terry, who is the Company’s principal shareholder who is also actively involved in its operations. On January 12, 2017, the Company changed its name from EZJR, Inc. to Her Imports. eCommerce Platform In January 2018, the Company converted to a new cloud-based eCommerce platform from its server-based eCommerce platform. The primary reason for the change was to allow the Company to optimize its mobile marketing efforts. In the past, marketing efforts have focused on traditional media, email, and search. However, due to the proliferation of smart phones and social media it is much more effective, while less expensive, to reach our customers using mobile marketing using SMS messaging and social platforms such as Facebook and Snapchat. Furthermore, advances in eCommerce shopping carts to cloud-based platforms allow for significant customization that was not previously available. The Company can interface with the shopping cart using various self-developed “mini-CRMs” depending on the marketing promotion and platform. As a result of the change, the Company incurred a one-time charge of $383,542 from the write-off of the previous CRM and the prepaid maintenance agreement associated with it. Media Investor Purchaser Agreement On June 29, 2014, the Company entered into a Media Investor Purchaser Agreement (“MIP”) with Leader Act HK Ltd (“Leader”), a shareholder. On July 31, 2017, this agreement was assigned by Leader to Cabello. Prior to signing the agreement Leader advanced the Company $50,000 which the agreement allowed to be converted to 83,333 shares of common at $.60 per share. That left up to 9,500,000 shares of common stock that Cabello could purchase at $0.05 per share from its portion of the funds generated by the offers it creates. Contrary to customary practice, the MIP did not provide for any adjustment in the event of a future reverse split, so the Company’s recent reverse split did not affect the number of shares purchasable or the exercise price. This highlighted an unfair agreement which adversely affected the Company. This problem was exacerbated since Cabello is a related party. From April 19 to April 20, 2018, Cabello ran a program to sell a variety of the Company’s hair products. This program generated approximately $150,000 in revenue, however, a final accounting of the results of the program were never completed. Instead, on June 20, 2018 the Company issued to Cabello 4,500,000 of restricted common stock in exchange for cancelation of the MIP Agreement and forgiveness of any monies owed to Cabello for program in April. This cancellation resulted in a non-cash expense of $3,397,500 based on the estimated value of the stock issued in exchange for the cancellation of the agreement. Agreement with Cabello Real FZE On April 20, 2017, the Company entered into a Marketing and Selling Agreement with Cabello Real FZE, owner of a hair care product line called OSIworks, whereby the Company exclusively purchases, markets and sells OSIworks’ products in the United States. Under the agreement the Company pays Cabello a royalty of 2% of net sales. Cabello Real FZE is also controlled by Jonathan Terry, the Company’s principal shareholder. During the three- and nine-months ending September 30, 2018 the Company recognized royalty expense of $2,282 and $11,731, respectively, related to the agreement.

Summary of Significant Accounti

Summary of Significant Accounting Policies	9 Months Ended
	Sep. 30, 2018
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	2. Summary of Significant Accounting Policies There have been no changes in Significant Accounting Policies from those described in our Form 10-K for our fiscal year ending December 31, 2017 filed with the Securities and Exchange Commission on March 27, 2018. Principles of Consolidation The condensed consolidated financial statements include the accounts of the Company (a Nevada corporation) and its wholly owned subsidiary, Her Marketing. All significant intercompany transactions have been eliminated in consolidation. Basis of Presentation of the Condensed Consolidated Financial Statements The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, Her Marketing. The Company maintains its books of account and prepares consolidated financial statements in accordance with Generally Accepted Accounting Principles in the United States of America (“U.S. GAAP”). The Company’s fiscal year ends on December 31. All significant intercompany balances and transactions have been eliminated in consolidation. On January 31, 2017, the Company effected a 1-for-2 reverse stock split effective January 31, 2017. The par value was not adjusted as a result of the reverse stock split. On April 9, 2018, the Company effected a 1-for-6 reverse stock split effective April 9, 2018. All references to numbers of shares of our common stock and per-share information in the accompanying condensed consolidated financial statements and in these notes to the condensed consolidated financial statements have been adjusted retroactively to reflect these splits. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. The Company evaluates its estimates on an ongoing basis, including those related to the fair values of stock-based awards, income taxes and contingent liabilities, among others. The Company bases its estimates on historical experience and on various other assumptions that the Company believes to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results could differ from those estimates and such differences could be material to the consolidated financial position and results of operations. Fair Value of Financial Instruments The Company measures fair value based on the prices that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements are based on a three-tier hierarchy that prioritizes the inputs used to measure fair value, using quoted prices in active markets for identical assets (Level 1); significant other observable inputs (Level 2); and significant unobservable inputs (Level 3). The Company did not have any assets measured at fair value on a recurring basis at September 30, 2018 and December 31, 2017. The Company believes the carrying amounts of cash and cash equivalents, accounts receivable, other current assets, accounts payable, and other accrued liabilities are a reasonable approximation of the fair value of those financial instruments because of the nature of the underlying transactions and the short-term maturities involved. Deposits September 30, December 31, 2018 2017 Deposits on Products $ 168,059 $ 175,819 Security Deposits 26,709 20,573 Total $ 194,768 $ 196,392 Intangibles Intangible assets are comprised primarily of trademarks that represent the Company’s exclusive ownership of the HER trademarks in the US and are inclusive all related social media sites and domain names in the US., all used in connection with (consisting of the name, Her Imports and the Her Imports Logo) the manufacture, sale and distribution of human hair extensions and related beauty products. In accordance with Financial Accounting Standards Board Accounting Standard Codification 350 (FASB ASC 350), intangible assets with indefinite lives are not amortized but instead are measured for impairment at least annually, or when events indicate that an impairment exists through the use of discounted cash flow models. The Company calculates impairment as the excess of the carrying value of its indefinite-lived assets over their estimated fair value. If the carrying value exceeds the estimate of fair value a write-down is recorded. For the three and nine months ended September 30, 2018 and 2017 there were no impairments recorded. Revenue Recognition In May 2014, the Financial Accounting Standards Board (“FASB”) issued accounting standards update (“ASU”) No. 2014-09, Revenue from Contracts with Customers, to clarify the principles of recognizing revenue and create common revenue recognition guidance between U.S. GAAP and International Financial Reporting Standards. ASU No. 2014-09, as amended, is effective for the Company as of January 1, 2018. The adoption did not result in any material change in the timing of recognizing revenue The adoption will also result in a change in the timing of recognizing revenue for sales where we ship the merchandise to the customer from a distribution center or store, as revenue for sales where we ship the merchandise to customers will be recognized when control of the merchandise transfers to the customer, which is generally at the time of shipment rather than upon delivery of the products to the customer. Additionally, the Company has had a deminimis amount of sales returns. The Company, through the Her Imports retail locations, its eCommerce Website, www.herimports.com and Amazon.com sells a variety of hair extensions and related products. Revenue is recognized at the “point of sale” in the stores. Customers pay for the products using either cash, a debit card or a credit card. All sales are final. In the case of cash sales at the store, the store manager makes a nightly deposit of the cash. For credit card and debit sales, the Company recognizes the sale when the card is charged and approved. Sales tax collected from customers is excluded from revenue and is included in accrued liabilities on our condensed consolidated balance sheets. Product purchases on the Company’s Website are paid for using either debit cards, credit cards, or PayPal Revenue for online product sales are recognized upon shipment of the product. Additionally, customers have the option of making installment payments on products purchased. In this case fifty percent of the purchase price is paid at the time of sale and the remainder withdrawn from the customer’s account via ACH. Because there is a significant amount of uncertainty related to the subsequent collections via ACH, those payment are only recognized as revenue upon receipt. Finally, customers may purchase product using a payment facility called PayNearMe where a customer who doesn’t have a debit/credit/PayPal account can place an online order with an agreement to take cash and pay for the order at a PayNearMe location. The product is then shipped at time PayNearMe notifies the Company that the payment has been received. Revenue is recognized at the time of the shipment of the product. Also included in revenue is shipping revenue from our e-commerce customers. Sales taxes collected from retail customers are excluded from reported revenues when control of the merchandise transfers to the customers, which is generally at the time of shipment rather than upon delivery of the products to the customer. Revenue from sales on Amazon.com are recorded net of certain expenses paid to Amazon.com including selling fees, transaction fees, service fees, administrative fees and inventory and inbound service fees. All advertising fees paid to Amazon.com is recognized as a period expense and is booked to selling expense. Earnings (Loss) per Share The Company utilizes FASB ASC 260. Basic earnings per share is computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding. Diluted earnings per share is computed similar to basic earnings per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. Common equivalent shares are excluded from the computation if their effect is anti-dilutive. Reverse Stock Split All references to numbers of shares of our common stock and per-share information in the accompanying financial statements have been adjusted retroactively to reflect the Company’s 1-for-2 reverse stock split effected on January 31, 2017, and a 1-for-6 reverse stock split effective April 9, 2018. The par value was not adjusted because of the reverse stock splits. Stock-based compensation The Company records stock-based compensation issued to external entities for goods and services at either the fair market value of the shares issued, or the value of the services received, whichever is more readily determinable, using the measurement date guidelines enumerated in FASB ASC 505-50-30. For the three months and nine months ended September 30, 2018, the Company recognized stock-based compensation expense of $15,110 and $70,932, respectively. There was no stock-based compensation for the three months and nine months ended September 30, 2017. Recent Accounting Pronouncements Except as noted below, the Company has considered all recent accounting pronouncements and has concluded that there are no recent accounting pronouncements that may have a material impact on its condensed consolidated financial statements, based on current information. In July 2018, the FASB issued ASU 2018-10 Leases (Topic 842), Codification Improvements and ASU 2018-11 Leases (Topic 842), Targeted Improvements, to provide additional guidance for the adoption of Topic 842. ASU 2018-10 clarifies certain provisions and correct unintended applications of the guidance such as the application of implicit rate, lessee reassessment of lease classification, and certain transition adjustments that should be recognized to earnings rather than to stockholders’ equity. ASU 2018-11 provides an alternative transition method and practical expedient for separating contract components for the adoption of Topic 842. In February 2016, the FASB issued ASU 2016-02 Leases (Topic 842) which requires an entity to recognize assets and liabilities arising from a lease for both financing and operating leases with terms greater than 12 months. ASU 2018-11, ASU 2018-10, and ASU 2016-02 (collectively, “the new lease standards”) are effective for fiscal years beginning after December 15, 2018, with early adoption permitted. The Company is currently evaluating the effect the new lease standards will have on its Condensed Consolidated Financial Statements; however, the Company anticipates recognizing assets and liabilities arising from any leases that meet the requirements under the new lease standards on the adoption date and including qualitative and quantitative disclosures in the Company’s Notes to the Condensed Consolidated Financial Statements. In July 2018, the FASB issued ASU 2018-09, Codification Improvements. The amendments in ASU 2018-09 affect a wide variety of Topics in the FASB Codification and apply to all reporting entities within the scope of the affected accounting guidance. The Company has evaluated ASU 2018-09 in its entirety and determined that the amendments related to Topic 718-740, Compensation-Stock Compensation-Income Taxes, are the only provisions that currently apply to the Company. The amendments in ASU 2018-09 related to Topic 718-740, Compensation-Stock Compensation-Income Taxes, clarify that an entity should recognize excess tax benefits related to stock compensation transactions in the period in which the amount of the deduction is determined. The amendments in ASU 2018-09 related to Topic 718-740 are effective for fiscal years beginning after December 15, 2018, with early adoption permitted. The Company does not expect the adoption of the new standard to have a material impact on the Company’s Condensed Consolidated Financial Statements. In March 2018, the FASB issued ASU 2018-05, Income Taxes (Topic 740) - Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118. This standard amends Accounting Standards Codification 740, Income Taxes (ASC 740) to provide guidance on accounting for the tax effects of the Tax Cuts and Jobs Act (the Tax Reform Act) pursuant to Staff Accounting Bulletin No. 118, which allows companies to complete the accounting under ASC 740 within a one-year measurement period from the Tax Act enactment date. This standard is effective upon issuance. As described in the footnotes to the Annual Report on Form 10-K, the Company’s accounting for the tax effects of enactment of the Tax Reform Act is being assessed; however, in certain cases, as described below, we made a reasonable estimate of the effects on our existing deferred tax balances and valuation allowance. The Company determined that the $62.9 million recorded in connection with the re-measurement of certain deferred tax assets and liabilities, and corresponding valuation allowance was a provisional amount and a reasonable estimate at December 31, 2017. The Company has not completed the accounting with regard to the tax effects associated with an intra-entity transfer of certain intellectual property rights with the enactment of Tax Reform Act. Our accounting for the intra-entity transfer reflects the utilization of net operating losses on the basis of the laws in effect before the Tax Reform Act. The Company is evaluating the impact under Tax Reform Act on the Company’s global business structure. In all aspects, the Company will continue to make and refine calculations as additional analysis is completed. The Company expects to complete the accounting assessment during the one-year measurement period provided by SAB 118.

Property, Equipment and Softwar

Property, Equipment and Software	9 Months Ended
	Sep. 30, 2018
Property, Plant and Equipment [Abstract]
Property, Equipment and Software	3. Property, Equipment and Software Property and equipment consisted of the following: September 30, December 31, 2018 2017 Software $ 110,000 $ 463,310 Computers and equipment 107,339 99,592 Furniture 42,064 30,391 Leasehold improvements 26,384 19,493 subtotal 285,787 612,786 Accumulated depreciation and amortization (148,185 ) (345,322 ) Property, equipment and software, net $ 137,602 $ 267,464 Depreciation and amortization expense on property, plant, equipment, and software for the three and nine months ended September 30, 2018 was $18,871 and $58,462, respectively. Depreciation and amortization expense on property, plant, equipment, and software for the three and nine months ended September 30, 2017

Sales Tax Payable

Sales Tax Payable	9 Months Ended
	Sep. 30, 2018
Sales Tax Payable
Sales Tax Payable	4. Sales tax payable The Company is delinquent in filing some sales tax returns for one state (including the remittance of taxes), for which the Company has transacted business. The Company has recorded tax obligations plus potential interest and penalties estimated to be approximately $18,792, computed through September 30, 2018, which are included in accounts payable and accrued liabilities on the balance sheet. The Company is in the process of becoming fully compliant.

Related Party Transactions

Related Party Transactions	9 Months Ended
	Sep. 30, 2018
Related Party Transactions [Abstract]
Related Party Transactions	5. Related Party Transactions Related Party Accounts Receivable and Payable At September 30, 2018 and December 31, 2017, the Company had a receivable from Cabello, its principal stockholder, of $188,170 and $108,026, respectively, that resulted from payments made by the Company on behalf of Cabello. The Company has the right to offset this receivable against any future dividend payments owed Cabello related to the preferred stock described in Note 1. As described in Note 11, subsequent to September 30, 2018, two dividends of $60,000 each were declared and offset against amounts owed by Cabello. For further information on related party transactions, see Note 1. As described below, the Company incurred $11,731 in royalty expense in 2018 which has also been offset against the Cabello receivable. Royalty Expense Royalty expense is a result of royalties incurred on products sold under the brand name OSIworks, a company under common control with the Company’s principal shareholder. During the three ended September 30, 2018 and 2017 royalty expense was $2,282 and $5,286, respectively. During the nine months ended September 30, 2018 and 2017 royalty expense was $11,731 and $11,180, respectively. Contract Termination Expense – Related Party On June 20, 2018, the Company issued to Cabello 4,500,000 shares of restricted common stock in exchange for cancelation of the MIP Agreement (described in Note 1) and forgiveness of any monies owed to Cabello for program run in April. This cancellation resulted in a non-cash expense of $3,397,500 based on the estimated value of the stock issued in exchange for the cancellation of the agreement.

Commitments and Contingencies

Commitments and Contingencies	9 Months Ended
	Sep. 30, 2018
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	6. Commitments and Contingencies Leases At September 30, 2018, the Company leased or rented 20 different facilities including its corporate headquarters, a warehouse and 18 active retail locations. Future lease obligation for these facilities are as follows: Year Amount 2018 (remaining three months) $ 86,256 2019 257,990 2020 159,292 2021 148,804 2022 120,045 Thereafter 24,808 Total $ 797,195 Rent expense for the three months ended September 30, 2018 and 2017 was $125,885 and $150,167, respectively. Rent expense for the nine months ended September 30, 2018 and 2017 was $378,807 and $475,674, respectively. Concentrations As of September 30, 2018, the Company has only twelve qualified vendors that supply its wigs and hair extension products. The Company sources its hair care products from one vendor. There are numerous suppliers of styling tools as this is a commodity product. During the three months ended September 30, 2018, the Company purchased hair products from four different vendors, however, two vendors accounted for approximately 94.5% of all hair products purchased. During the nine months ended September 30, 2018, the Company purchased hair products from six different vendors, however, two vendors accounted for approximately 92.4% of all hair products purchased. During the three months ended September 30, 2017, the Company purchased hair products from four different vendors, however, two vendors accounted for approximately 96.6% of all hair products purchased. During the nine months ended September 30, 2017, the Company purchased hair products from six different vendors, however, two vendors accounted for approximately 92.1% of all hair products purchased. Legal Proceedings From time to time, the Company may become involved in various lawsuits and legal proceedings, which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm the Company’s business. On or about September 5, 2015, the Company received a summons naming it in a civil action against Her Imports, LLC, Her Imports New York, LLC, Her Holding, Inc. and EZJR, Inc. (now Her Imports) from a former independent contractor of Her Imports, LLC. The complaint claims unpaid wages and overtime wages in violation of New York Labor Law, among other things. No specific damages are mentioned in the complaint. The Company subsequently answered the complaint and denied any wrongdoing as EZJR had no relationship with the contractor, whatsoever. At this point in the litigation it is impracticable to foresee the outcome, however, the Company believes it has meritorious defense and is vigorously defending this litigation. On February 16, 2018, a magistrate judge ruled that EZJR, Her Holding and Her Imports, LLC acted as a joint employer. The judge also found that genuine issues of material fact exist as to “whether plaintiff qualifies as an ‘employee’ under the law or was an ‘independent contractor’.” While the Company disagrees with the ruling that it was a joint employer, it has decided to proceed to trial on the basis that the plaintiff was an independent contractor, while reserving the right to appeal the decision. On or about On March 13, 2018, the Company received a summons in a civil action alleging that it had violated the Telephone Consumer Protection Act of 1991 (TCPA). In the complaint, an individual who provided his phone number to the Company to obtain certain discounts on the Company’s products, claims that the Company sent several text messages to his cell phone without prior written consent. The suit was filed by on behalf of the plaintiff and others similarly situated. On or about June 5, 2018 the Company received a second summons in a civil action also alleging that it had violated the TCPA. In the complaint, an individual who provided her phone number to the Company to obtain certain discounts on the Company’s products, claims that the Company sent several text messages to her cell phone without prior written consent. The suit was filed by on behalf of the plaintiff and others similarly situated. In both instances our review of the circumstance surrounding the claim are that the actions are not justified and as such we made the decision to intend to vigorously defend the Company against these actions. In the case of the first action we have filed a response denying the allegations. In the case of the second action we have file a motion to dismiss or consolidate this action with the first based on what is known “the-first-to-file rule.” To date there has been no ruling on this motion. On January 12, 2017, the Company entered into a Business Purchase Agreement with EnzymeBioSystems, Inc. (“EnzymeBio”), a Nevada corporation, whereby the Company entered into an agreement to purchase 100% ownership of EnzymeBio’s wholly owned subsidiary, Share Acquisition Corp. (“SAC”), a Nevada corporation in exchange for approximately 9,167 shares of the Company’s common stock and $25,000 cash. On February 28, 2017, EnzymeBio agreed to spin-off SAC as a dividend. Pursuant to the Business Purchase Agreement and Nevada Revised Stature 92A.180 (Merger of a subsidiary into parent or parent into subsidiary) ,

Promissory Notes

Promissory Notes	9 Months Ended
	Sep. 30, 2018
Debt Disclosure [Abstract]
Promissory Notes	7. Promissory Notes UPS Capital On November 8, 2017 the Company entered into an agreement with UPS Capital Corporation (UPS) for a $500,000 credit facility. Under the terms of the agreement UPS will loan 100% of the invoice amount on incoming offshore shipments carried by UPS. Upon funding the loan, the Company pays a transaction fee of 1.85% or 2.75% for air shipment or ocean shipment, respectively. Repayment of amounts funded are due in 60 days for air shipments and 90 days for ocean shipment. Amounts funded are secured by inventory on hand and are personally guaranteed by the Company’s Chief Executive Officer and the Company’s principal controlling shareholder. As of September 30, 2018, and December 31, 2017 the Company owed $409,511 and $177,390, respectively under the facility.

Stockholders' Equity

Stockholders' Equity	9 Months Ended
	Sep. 30, 2018
Equity [Abstract]
Stockholders' Equity	8. Stockholders’ Equity On January 31, 2017, the Company effected a 1-for-2 reverse stock split effective January 31, 2017. The par value was not adjusted as a result of the reverse stock split. On April 9, 2018, the Company effected a 1-for-6 reverse stock split effective April 9, 2018. All references to numbers of shares of our common stock and per-share information in the accompanying condensed consolidated financial statements and in these notes to the condensed consolidated financial statements have been adjusted retroactively to reflect these splits. As described in Note 1, on November 28, 2016, the Company entered into an Asset Share Purchase & Business Agreement with Cabello to acquire the exclusive U.S. rights to the Her Imports trademark. In exchange for these rights, and other digital assets, the Company issued to Cabello 10,000,000 shares of unregistered non-voting, non-cumulative, callable preferred stock (subsequently revised to 5,000,000 shares) and 1,250,000 unregistered common stock with a combined value of $8,200,000. All shares of callable preferred stock rank superior to all the Company’s preferred stock and common stock currently outstanding and hereafter issued, as to distributions of assets upon liquidation, dissolution or winding up of the Company, whether voluntary or involuntary (with the exception of a merger), including the payment of dividends. The callable preferred stock is subject to a monthly dividend payment equal to a rate of $0.144 per share of preferred stock per annum. The declaration and payment of the dividend on a monthly basis is subject to the approval of the Company’s Board of Directors. Such dividend is non-cumulative should the Company not pay the dividend. The Company has a right of first refusal to purchase the callable preferred stock, should the shareholder decide to sell all or part of their callable preferred stock. The callable preferred stock has no voting rights. Through September 30, 2018, the Board of Directors has declared and approved, preferred stock dividends of $1,320,000 ($60,000 each month) to Cabello related to the 5,000,000 shares of callable, non-voting, non-cumulative preferred stock. Because the dividends on the preferred stock are non-cumulative and at the discretion of the Company, these preferred shares are considered to be equity. At September 30, 2018 and December 31, 2017, the Company had 10,000,000 shares of preferred stock authorized and 5,000,000 issued and outstanding and 70,000,000 shares of common stock authorized. At September 30, 2018 and December 31, 2017 there were 8,656,459 and 4,150,039 shares of common stock outstanding, respectively. As described in Note 1, on October 13, 2016, the Company entered into a five-year maintenance agreement on its eCommerce platform with Leader in exchange for 250,000 shares of the Company’s common stock valued at $375,000 based on the fair market value of a service maintenance contract provided to other third parties which approximates the fair value of the common stock at the time it was issued. In January 2018 the Company converted to a new cloud-based eCommerce platform from its server-based eCommerce platform. As a result, the Company wrote off $265,625 of unamortized prepaid software maintenance related to the agreement. As described in Note 1, on June 20, 2018 the Company issued 4,500,000 shares of restricted common stock to Cabello in exchange for cancelation of the MIP Agreement and forgiveness of monies owed to Cabello for program that was run in April 2018.

Stock-based Compensation

Stock-based Compensation	9 Months Ended
	Sep. 30, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Stock-based Compensation	9. Stock-based Compensation On September 5, 2017 the Company adopted the 2017 Her Imports Stock Incentive Plan. For the three and nine months ended September 30, 2018, the Company recognized $15,110 and $70,932, respectively in stock-based compensation related to stock options and common stock issued under the plan. Stock-based compensation expense is included in the following captions on the condensed consolidated statements of operations. Three Month Ended Nine Month Ended September 30, 2018 September 30, 2018 Selling expense $ 9,451 $ 38,041 General and administrative expense 5,659 32,891 Total $ 15,110 $ 70,932 Changes in the Company’s outstanding stock options under the plan during the nine months ended September 30, 2018 were as follows: Weighted Number of Average Options Price Outstanding at December 31, 2017 58,332 $ 9.42 Granted 3,332 1.65 Exercised - - Forfeited or expired (8,333 ) 10.68 Outstanding at September 30, 2018 53,331 $ 8.73 Exercisable at September 30, 2018 25,832 $ 8.99 The weighted average remaining contractual term and aggregate intrinsic value of outstanding options as of September 30, 2018 was 3.86 years and $99,538, respectively. The Company’s stock options are measured at fair value using the Black-Scholes Option Pricing Model methodology. A summary of the weighted average (in aggregate) significant unobservable inputs (Level 3 inputs) used in measuring the Company’s stock options that are categorized within Level 3 of the fair value hierarchy for nine months September 30, 2018 is as follows: Strike Price $ 1.65 to 10.68 Volatility 46.21 % Risk-free interest rate 2.15 % Contractual life (in years) 5 Dividend yield (per share) 0 %

Income Taxes

Income Taxes	9 Months Ended
	Sep. 30, 2018
Income Tax Disclosure [Abstract]
Income Taxes	10. Income Taxes The tax reform bill that Congress voted to approve December 20, 2017, also known as the “Tax Cuts and Jobs Act”, made sweeping modifications to the Internal Revenue Code, including a much lower corporate tax rate, changes to credits and deductions, and a move to a territorial system for corporations that have overseas earnings. The act replaced the prior-law graduated corporate tax rate, which taxed income over $10 million at 35%, with a flat rate of 21%. The Company and its subsidiaries are subject to U.S. federal income tax as well as income tax of multiple state jurisdictions. An approximate estimated blended tax rate of 16.3% was used to calculate the benefit for taxes based on operations for the nine months ended September 30, 2018 and 23.1% to calculate the provision for taxes based on income for the nine months ended September 30, 2017. For financial reporting purposes the benefit for income taxes is based on a pre-tax loss of $709,213 for the nine months ended September 30, 2018 and pre-tax income of $724,247 for the nine months ended September 30, 2017. In 2018, and for fourteen years thereafter, there will be a permanent book versus tax difference of $546,667 each year related to the amortization of the trademark, which is deductible for tax purposes but is not amortized and expensed for financial reporting purposes. The provision (benefit) for income taxes for the three and nine months ended September 30, 2018 and 2017 consisted of the following: Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2018 2017 2018 2017 U.S. Federal $ 42,115 $ 78,811 $ 142,870 $ (146,947 ) U.S. State (3,799 ) (2,051 ) (10,667 ) (21,949 ) Total 38,316 76,760 132,203 (168,896 ) Deferred - - - - Total benefit (provision) for income taxes $ 38,316 $ 76,760 $ 132,203 $ (168,896 ) As of September 30, 2018, we had a tax loss carryforward of approximately $1,436,657 which can be used to offset future Federal income taxes.

Subsequent Events

Subsequent Events	9 Months Ended
	Sep. 30, 2018
Subsequent Events [Abstract]
Subsequent Events	11. Subsequent Events On October 3, 2018, the Board of Directors approved the monthly $60,000 dividend related to 5,000,000 shares of Callable Preferred Stock owned by Cabello Real Ltd. This dividend was offset against amounts owed to the Company by Cabello. On and effective October 30, 2018 all parties involved in the EnzymeBio lawsuit agreed to a settlement and mutual release. Under the settlement, the Company agreed to dismiss that lawsuit. In return, certain shareholders of the Company agreed to return to the Company 72,324 shares of the Company’s common stock upon the filing by the Company of a Form 15 with the U.S. Securities and Exchange Commission. The returned common stock will be retired. Additionally, the shareholders agreed to place 120,000 shares of common stock in an attorney trust account and that such shares will be surrendered for retirement to the Company on January 1, 2020 should the Company refrain from trading its stock other and a “pink sheet system or OTC market.” On November 7, 2018, the the sole member of the Board of Directors approved the monthly $60,000 dividend related to 5,000,000 shares of Callable Preferred Stock owned by Cabello Real Ltd. This dividend was offset against amounts owed to the Company by Cabello.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	9 Months Ended
	Sep. 30, 2018
Accounting Policies [Abstract]
Principles of Consolidation	Principles of Consolidation The condensed consolidated financial statements include the accounts of the Company (a Nevada corporation) and its wholly owned subsidiary, Her Marketing. All significant intercompany transactions have been eliminated in consolidation.
Basis of Presentation of the Condensed Consolidated Financial Statements	Basis of Presentation of the Condensed Consolidated Financial Statements The accompanying condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiary, Her Marketing. The Company maintains its books of account and prepares consolidated financial statements in accordance with Generally Accepted Accounting Principles in the United States of America (“U.S. GAAP”). The Company’s fiscal year ends on December 31. All significant intercompany balances and transactions have been eliminated in consolidation. On January 31, 2017, the Company effected a 1-for-2 reverse stock split effective January 31, 2017. The par value was not adjusted as a result of the reverse stock split. On April 9, 2018, the Company effected a 1-for-6 reverse stock split effective April 9, 2018. All references to numbers of shares of our common stock and per-share information in the accompanying condensed consolidated financial statements and in these notes to the condensed consolidated financial statements have been adjusted retroactively to reflect these splits.
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. The Company evaluates its estimates on an ongoing basis, including those related to the fair values of stock-based awards, income taxes and contingent liabilities, among others. The Company bases its estimates on historical experience and on various other assumptions that the Company believes to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results could differ from those estimates and such differences could be material to the consolidated financial position and results of operations.
Fair Value of Financial Instruments	Fair Value of Financial Instruments The Company measures fair value based on the prices that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements are based on a three-tier hierarchy that prioritizes the inputs used to measure fair value, using quoted prices in active markets for identical assets (Level 1); significant other observable inputs (Level 2); and significant unobservable inputs (Level 3). The Company did not have any assets measured at fair value on a recurring basis at September 30, 2018 and December 31, 2017. The Company believes the carrying amounts of cash and cash equivalents, accounts receivable, other current assets, accounts payable, and other accrued liabilities are a reasonable approximation of the fair value of those financial instruments because of the nature of the underlying transactions and the short-term maturities involved.
Deposits	Deposits September 30, December 31, 2018 2017 Deposits on Products $ 168,059 $ 175,819 Security Deposits 26,709 20,573 Total $ 194,768 $ 196,392
Intangibles	Intangibles Intangible assets are comprised primarily of trademarks that represent the Company’s exclusive ownership of the HER trademarks in the US and are inclusive all related social media sites and domain names in the US., all used in connection with (consisting of the name, Her Imports and the Her Imports Logo) the manufacture, sale and distribution of human hair extensions and related beauty products. In accordance with Financial Accounting Standards Board Accounting Standard Codification 350 (FASB ASC 350), intangible assets with indefinite lives are not amortized but instead are measured for impairment at least annually, or when events indicate that an impairment exists through the use of discounted cash flow models. The Company calculates impairment as the excess of the carrying value of its indefinite-lived assets over their estimated fair value. If the carrying value exceeds the estimate of fair value a write-down is recorded. For the three and nine months ended September 30, 2018 and 2017 there were no impairments recorded.
Revenue Recognition	Revenue Recognition In May 2014, the Financial Accounting Standards Board (“FASB”) issued accounting standards update (“ASU”) No. 2014-09, Revenue from Contracts with Customers, to clarify the principles of recognizing revenue and create common revenue recognition guidance between U.S. GAAP and International Financial Reporting Standards. ASU No. 2014-09, as amended, is effective for the Company as of January 1, 2018. The adoption did not result in any material change in the timing of recognizing revenue The adoption will also result in a change in the timing of recognizing revenue for sales where we ship the merchandise to the customer from a distribution center or store, as revenue for sales where we ship the merchandise to customers will be recognized when control of the merchandise transfers to the customer, which is generally at the time of shipment rather than upon delivery of the products to the customer. Additionally, the Company has had a deminimis amount of sales returns. The Company, through the Her Imports retail locations, its eCommerce Website, www.herimports.com and Amazon.com sells a variety of hair extensions and related products. Revenue is recognized at the “point of sale” in the stores. Customers pay for the products using either cash, a debit card or a credit card. All sales are final. In the case of cash sales at the store, the store manager makes a nightly deposit of the cash. For credit card and debit sales, the Company recognizes the sale when the card is charged and approved. Sales tax collected from customers is excluded from revenue and is included in accrued liabilities on our condensed consolidated balance sheets. Product purchases on the Company’s Website are paid for using either debit cards, credit cards, or PayPal Revenue for online product sales are recognized upon shipment of the product. Additionally, customers have the option of making installment payments on products purchased. In this case fifty percent of the purchase price is paid at the time of sale and the remainder withdrawn from the customer’s account via ACH. Because there is a significant amount of uncertainty related to the subsequent collections via ACH, those payment are only recognized as revenue upon receipt. Finally, customers may purchase product using a payment facility called PayNearMe where a customer who doesn’t have a debit/credit/PayPal account can place an online order with an agreement to take cash and pay for the order at a PayNearMe location. The product is then shipped at time PayNearMe notifies the Company that the payment has been received. Revenue is recognized at the time of the shipment of the product. Also included in revenue is shipping revenue from our e-commerce customers. Sales taxes collected from retail customers are excluded from reported revenues when control of the merchandise transfers to the customers, which is generally at the time of shipment rather than upon delivery of the products to the customer. Revenue from sales on Amazon.com are recorded net of certain expenses paid to Amazon.com including selling fees, transaction fees, service fees, administrative fees and inventory and inbound service fees. All advertising fees paid to Amazon.com is recognized as a period expense and is booked to selling expense.
Earnings (Loss) Per Share	Earnings (Loss) per Share The Company utilizes FASB ASC 260. Basic earnings per share is computed by dividing income available to common stockholders by the weighted-average number of common shares outstanding. Diluted earnings per share is computed similar to basic earnings per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if the potential common shares had been issued and if the additional common shares were dilutive. Common equivalent shares are excluded from the computation if their effect is anti-dilutive.
Reverse Stock Split	Reverse Stock Split All references to numbers of shares of our common stock and per-share information in the accompanying financial statements have been adjusted retroactively to reflect the Company’s 1-for-2 reverse stock split effected on January 31, 2017, and a 1-for-6 reverse stock split effective April 9, 2018. The par value was not adjusted because of the reverse stock splits.
Stock-based Compensation	Stock-based compensation The Company records stock-based compensation issued to external entities for goods and services at either the fair market value of the shares issued, or the value of the services received, whichever is more readily determinable, using the measurement date guidelines enumerated in FASB ASC 505-50-30. For the three months and nine months ended September 30, 2018, the Company recognized stock-based compensation expense of $15,110 and $70,932, respectively. There was no stock-based compensation for the three months and nine months ended September 30, 2017.
Recent Accounting Pronouncements	Recent Accounting Pronouncements Except as noted below, the Company has considered all recent accounting pronouncements and has concluded that there are no recent accounting pronouncements that may have a material impact on its condensed consolidated financial statements, based on current information. In July 2018, the FASB issued ASU 2018-10 Leases (Topic 842), Codification Improvements and ASU 2018-11 Leases (Topic 842), Targeted Improvements, to provide additional guidance for the adoption of Topic 842. ASU 2018-10 clarifies certain provisions and correct unintended applications of the guidance such as the application of implicit rate, lessee reassessment of lease classification, and certain transition adjustments that should be recognized to earnings rather than to stockholders’ equity. ASU 2018-11 provides an alternative transition method and practical expedient for separating contract components for the adoption of Topic 842. In February 2016, the FASB issued ASU 2016-02 Leases (Topic 842) which requires an entity to recognize assets and liabilities arising from a lease for both financing and operating leases with terms greater than 12 months. ASU 2018-11, ASU 2018-10, and ASU 2016-02 (collectively, “the new lease standards”) are effective for fiscal years beginning after December 15, 2018, with early adoption permitted. The Company is currently evaluating the effect the new lease standards will have on its Condensed Consolidated Financial Statements; however, the Company anticipates recognizing assets and liabilities arising from any leases that meet the requirements under the new lease standards on the adoption date and including qualitative and quantitative disclosures in the Company’s Notes to the Condensed Consolidated Financial Statements. In July 2018, the FASB issued ASU 2018-09, Codification Improvements. The amendments in ASU 2018-09 affect a wide variety of Topics in the FASB Codification and apply to all reporting entities within the scope of the affected accounting guidance. The Company has evaluated ASU 2018-09 in its entirety and determined that the amendments related to Topic 718-740, Compensation-Stock Compensation-Income Taxes, are the only provisions that currently apply to the Company. The amendments in ASU 2018-09 related to Topic 718-740, Compensation-Stock Compensation-Income Taxes, clarify that an entity should recognize excess tax benefits related to stock compensation transactions in the period in which the amount of the deduction is determined. The amendments in ASU 2018-09 related to Topic 718-740 are effective for fiscal years beginning after December 15, 2018, with early adoption permitted. The Company does not expect the adoption of the new standard to have a material impact on the Company’s Condensed Consolidated Financial Statements. In March 2018, the FASB issued ASU 2018-05, Income Taxes (Topic 740) - Amendments to SEC Paragraphs Pursuant to SEC Staff Accounting Bulletin No. 118. This standard amends Accounting Standards Codification 740, Income Taxes (ASC 740) to provide guidance on accounting for the tax effects of the Tax Cuts and Jobs Act (the Tax Reform Act) pursuant to Staff Accounting Bulletin No. 118, which allows companies to complete the accounting under ASC 740 within a one-year measurement period from the Tax Act enactment date. This standard is effective upon issuance. As described in the footnotes to the Annual Report on Form 10-K, the Company’s accounting for the tax effects of enactment of the Tax Reform Act is being assessed; however, in certain cases, as described below, we made a reasonable estimate of the effects on our existing deferred tax balances and valuation allowance. The Company determined that the $62.9 million recorded in connection with the re-measurement of certain deferred tax assets and liabilities, and corresponding valuation allowance was a provisional amount and a reasonable estimate at December 31, 2017. The Company has not completed the accounting with regard to the tax effects associated with an intra-entity transfer of certain intellectual property rights with the enactment of Tax Reform Act. Our accounting for the intra-entity transfer reflects the utilization of net operating losses on the basis of the laws in effect before the Tax Reform Act. The Company is evaluating the impact under Tax Reform Act on the Company’s global business structure. In all aspects, the Company will continue to make and refine calculations as additional analysis is completed. The Company expects to complete the accounting assessment during the one-year measurement period provided by SAB 118.

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Tables)	9 Months Ended
	Sep. 30, 2018
Accounting Policies [Abstract]
Schedule of Deposits	September 30, December 31, 2018 2017 Deposits on Products $ 168,059 $ 175,819 Security Deposits 26,709 20,573 Total $ 194,768 $ 196,392

Property, Equipment and Softw_2

Property, Equipment and Software (Tables)	9 Months Ended
	Sep. 30, 2018
Property, Plant and Equipment [Abstract]
Summary of Property, Equipment and Software	Property and equipment consisted of the following: September 30, December 31, 2018 2017 Software $ 110,000 $ 463,310 Computers and equipment 107,339 99,592 Furniture 42,064 30,391 Leasehold improvements 26,384 19,493 subtotal 285,787 612,786 Accumulated depreciation and amortization (148,185 ) (345,322 ) Property, equipment and software, net $ 137,602 $ 267,464

Commitments and Contingencies (

Commitments and Contingencies (Tables)	9 Months Ended
	Sep. 30, 2018
Commitments and Contingencies Disclosure [Abstract]
Schedule of Future Lease Payments	Future lease obligation for these facilities are as follows: Year Amount 2018 (remaining three months) $ 86,256 2019 257,990 2020 159,292 2021 148,804 2022 120,045 Thereafter 24,808 Total $ 797,195

Stock-based Compensation (Table

Stock-based Compensation (Tables)	9 Months Ended
	Sep. 30, 2018
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Schedule of Stock-based Compensation Expense	Stock-based compensation expense is included in the following captions on the condensed consolidated statements of operations. Three Month Ended Nine Month Ended September 30, 2018 September 30, 2018 Selling expense $ 9,451 $ 38,041 General and administrative expense 5,659 32,891 Total $ 15,110 $ 70,932
Schedule of Outstanding Stock Options	Changes in the Company’s outstanding stock options under the plan during the nine months ended September 30, 2018 were as follows: Weighted Number of Average Options Price Outstanding at December 31, 2017 58,332 $ 9.42 Granted 3,332 1.65 Exercised - - Forfeited or expired (8,333 ) 10.68 Outstanding at September 30, 2018 53,331 $ 8.73 Exercisable at September 30, 2018 25,832 $ 8.99
Summary of Weighted Average Stock Options Assumptions	A summary of the weighted average (in aggregate) significant unobservable inputs (Level 3 inputs) used in measuring the Company’s stock options that are categorized within Level 3 of the fair value hierarchy for nine months September 30, 2018 is as follows: Strike Price $ 1.65 to 10.68 Volatility 46.21 % Risk-free interest rate 2.15 % Contractual life (in years) 5 Dividend yield (per share) 0 %

Income Taxes (Tables)

Income Taxes (Tables)	9 Months Ended
	Sep. 30, 2018
Income Tax Disclosure [Abstract]
Schedule of Provision (Benefit) for Income Taxes	The provision (benefit) for income taxes for the three and nine months ended September 30, 2018 and 2017 consisted of the following: Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2018 2017 2018 2017 U.S. Federal $ 42,115 $ 78,811 $ 142,870 $ (146,947 ) U.S. State (3,799 ) (2,051 ) (10,667 ) (21,949 ) Total 38,316 76,760 132,203 (168,896 ) Deferred - - - - Total benefit (provision) for income taxes $ 38,316 $ 76,760 $ 132,203 $ (168,896 )

Description of the Company (Det

Description of the Company (Details Narrative) - USD ($)	Jun. 20, 2018	Apr. 20, 2018	Jun. 29, 2014	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017	Apr. 20, 2017	Nov. 28, 2016
Preferred stock call price per share				$ 0.144		$ 0.144		$ 0.144
Liquidation preference price per share				$ 2		$ 2		$ 2
Write off of previous CRM one time charges						$ 383,542
Revenue		$ 150,000
Number of restricted common stock shares issued in exchange for cancelation of agreement and forgiveness of money	4,500,000
Contract termination expense - related party	$ 3,397,500					3,397,500
Royalties				$ 2,282	$ 5,286	$ 11,731	$ 11,180
Asset Share Purchase & Business Agreement [Member]
Unregistered non-voting, non-cumulative, callable preferred stock										10,000,000
Revised unregistered preferred stock										5,000,000
Preferred stock call price per share										$ 0.144
Unregistered common stock										1,250,000
Cabello Real Ltd [Member] | Asset Share Purchase & Business Agreement [Member]
Unregistered non-voting, non-cumulative, callable preferred stock										10,000,000
Revised unregistered preferred stock										5,000,000
Preferred stock call price per share										$ 0.144
Liquidation preference price per share										$ 2
Unregistered common stock										1,250,000
Callable non-cumulative preferred stock designated										5,000,000
Callable non-cumulative preferred stock, par value										$ 0.001
Cabello Real Ltd [Member] | Media Investor Purchaser Agreement [Member]
Common stock price per share			$ 0.05
Number of common stock shares issued			9,500,000
Number of restricted common stock shares issued in exchange for cancelation of agreement and forgiveness of money	4,500,000
Cabello Real Ltd [Member] | Marketing and Selling Agreement [Member]
Royalty cash payments percentage									2.00%
Leader Act Ltd HK [Member] | Media Investor Purchaser Agreement [Member]
Value of advanced amount under agreement			$ 50,000
Number of stock conversion of converted shares			83,333
Common stock price per share			$ 0.60

Summary of Significant Accoun_4

Summary of Significant Accounting Policies (Details Narrative) - USD ($)	Apr. 09, 2018	Jan. 31, 2017	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Accounting Policies [Abstract]
Reverse stock split	1-for-6 reverse stock split	1-for- 2 reverse stock split
Recognized stock base compensation expense			$ 15,110		$ 70,932

Summary of Significant Accoun_5

Summary of Significant Accounting Policies - Schedule of Deposits (Details) - USD ($)	Sep. 30, 2018	Dec. 31, 2017
Accounting Policies [Abstract]
Deposits on Products	$ 168,059	$ 175,819
Security Deposits	26,709	20,573
Total	$ 194,768	$ 196,392

Property, Equipment and Softw_3

Property, Equipment and Software (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Property, Plant and Equipment [Abstract]
Depreciation and amortization expense	$ 18,871		$ 58,462	$ 92,439

Property, Equipment and Softw_4

Property, Equipment and Software - Summary of Property, Equipment and Software (Details) - USD ($)	Sep. 30, 2018	Dec. 31, 2017
Property, Plant and Equipment [Abstract]
Software	$ 110,000	$ 463,310
Computers and equipment	107,339	99,592
Furniture	42,064	30,391
Leasehold improvements	26,384	19,493
Property, equipment and software, gross	285,787	612,786
Accumulated depreciation and amortization	(148,185)	(345,322)
Property, equipment and software, net	$ 137,602	$ 267,464

Sales Tax Payable (Details Narr

Sales Tax Payable (Details Narrative)	Sep. 30, 2018USD ($)
Sales Tax [Member]
Tax amount	$ 18,792

Related Party Transactions (Det

Related Party Transactions (Details Narrative) - USD ($)	Jun. 20, 2018	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Related party receivables		$ 188,170		$ 188,170		$ 108,026
Dividend declared		60,000		60,000
Royalty expense		2,282	$ 5,286	11,731	$ 11,180
Loss on termination of agreement	$ 3,397,500			$ 3,397,500
Media Investor Purchaser Agreement [Member] | Cabello [Member]
Royalty expense	$ 11,731
Restricted common stock shares issued	4,500,000

Commitments and Contingencies_2

Commitments and Contingencies (Details Narrative) - USD ($)	Mar. 13, 2018	Feb. 28, 2017	Jan. 12, 2017	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2017
Rent expense				$ 125,885	$ 150,167	$ 378,807	$ 475,674
Other asset				$ 25,000		25,000		$ 25,000
Investment in subsidiary						$ 25,000
Legal fees	$ 25,000
October 30, 2018 [Member]
Number of shares retired						72,324
January 1, 2020 [Member]
Number of shares retired						120,000
Business Purchase Agreement [Member] | EnzymeBioSystems, Inc [Member]
Equity method investment, ownership percentage			100.00%
Number of common stock shares exchanged			9,167
Number of common stock shares exchanged, value			$ 25,000
Purchase of common stock from stockholder		$ 25,000
Product Concentration Risk [Member] | Two Vendors [Member]
Concentrations risk percentage				94.50%	96.60%	92.40%	92.10%

Commitments and Contingencies -

Commitments and Contingencies - Schedule of Future Lease Payments (Details)	Sep. 30, 2018USD ($)
Commitments and Contingencies Disclosure [Abstract]
2018 (remaining three months)	$ 86,256
2,019	257,990
2,020	159,292
2,021	148,804
2,022	120,045
Thereafter	24,808
Total	$ 797,195

Promissory Notes (Details Narra

Promissory Notes (Details Narrative) - USD ($)	Nov. 08, 2017	Nov. 08, 2017	Sep. 30, 2018	Dec. 31, 2017
Note payable			$ 409,511	$ 177,390
UPS Capital Corporation [Member]
Line of credit facility	$ 500,000
Percent of loan on invoice amount	100.00%	100.00%
UPS Capital Corporation [Member] | Air Shipment [Member]
Transaction fee, percent		1.85%
UPS Capital Corporation [Member] | Ocean Shipment [Member]
Transaction fee, percent		2.75%

Stockholders' Equity (Details N

Stockholders' Equity (Details Narrative) - USD ($)	Jun. 20, 2018	Apr. 09, 2018	Oct. 13, 2016	Jan. 31, 2017	Sep. 30, 2018	Dec. 31, 2017	Nov. 28, 2016
Reverse stock split		1-for-6 reverse stock split		1-for- 2 reverse stock split
Preferred stock call price per share					$ 0.144	$ 0.144
Preferred stock, shares authorized					10,000,000	10,000,000
Preferred stock, shares issued					5,000,000	5,000,000
Preferred stock, shares outstanding					5,000,000	5,000,000
Common stock, shares authorized					70,000,000	70,000,000
Common stock, shares issued					8,656,459	4,150,059
Common stock, shares outstanding					8,656,459	4,150,059
Number of restricted common stock shares issued in exchange for cancelation of agreement and forgiveness of money	4,500,000
Asset Share Purchase & Business Agreement [Member]
Unregistered non-voting, non-cumulative, callable preferred stock							10,000,000
Revised unregistered preferred stock							5,000,000
Unregistered common stock							1,250,000
Unregistered common stock combined value							$ 8,200,000
Preferred stock call price per share							$ 0.144
Software Maintenance Agreement [Member]
Maintenance agreement, terms			5 years
Issuance of common stock in exchange of software maintenance agreement, Shares			250,000
Issuance of common stock in exchange of software maintenance agreement			$ 375,000
Software unamortized written off value			$ 265,625
Cabello Real Ltd [Member]
Preferred stock dividend payment					$ 1,320,000
Preferred stock monthly dividend payment					$ 60,000
Preferred stock dividend payment shares					5,000,000

Stock-based Compensation (Detai

Stock-based Compensation (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Stock-based compensation	$ 15,110		$ 70,932
Weighted average remaining contractual term			3 years 10 months 10 days
Options outstanding value	$ 99,538		$ 99,538

Stock-based Compensation - Sche

Stock-based Compensation - Schedule of Stock-Based Compensation Expense (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Total	$ 15,110		$ 70,932
Selling Expense [Member]
Total	9,451		38,041
General and Administrative Expense [Member]
Total	$ 5,659		$ 32,891

Stock-based Compensation - Sc_2

Stock-based Compensation - Schedule of Outstanding Stock Options (Details)	9 Months Ended
	Sep. 30, 2018$ / sharesshares
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Number of Options Outstanding Beginning Balance | shares	58,332
Number of Options Granted | shares	3,332
Number of Options Exercised | shares
Number of Options Forfeited of Expired | shares	(8,333)
Number of Options Outstanding Ending Balance | shares	53,331
Number of Options Exercisable Ending Balance | shares	25,832
Weighted Average Price Outstanding Beginning Balance | $ / shares	$ 9.42
Weighted Average Price Granted | $ / shares	1.65
Weighted Average Price Exercised | $ / shares
Weighted Average Price Forfeited of Expired | $ / shares	10.68
Weighted Average Price Outstanding Ending Balance | $ / shares	8.73
Weighted Average Price Exercisable Ending Balance | $ / shares	$ 8.99

Stock-based Compensation - Summ

Stock-based Compensation - Summary of Weighted Average Stock Options Assumptions (Details)	9 Months Ended
	Sep. 30, 2018$ / shares
Volatility	46.21%
Risk-free interest rate	2.15%
Contractual life (in years)	5 years
Dividend yield (per share)	0.00%
Minimum [Member]
Strike Price	$ 1.65
Maximum [Member]
Strike Price	$ 10.68

Income Taxes (Details Narrative

Income Taxes (Details Narrative) - USD ($)	9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017
Income Tax Disclosure [Abstract]
Corporate taxed income	$ 10,000,000
Corporate tax rate	35.00%
Corporate flat rate	21.00%
Estimated blended tax rate	16.30%
Provision for tax percentage		23.10%
Benefit for income taxes on pre-tax loss (income)	$ 709,213	$ 724,247
Amortization of trademark expenses	546,667
Tax loss carryforward	$ 1,436,657

Income Taxes - Schedule of Prov

Income Taxes - Schedule of Provision (Benefit) for Income Taxes (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2018	Sep. 30, 2017	Sep. 30, 2018	Sep. 30, 2017
Income Tax Disclosure [Abstract]
U.S. Federal	$ 42,115	$ 78,811	$ 142,870	$ (146,947)
U.S. State	(3,799)	(2,051)	(10,667)	(21,949)
Total	38,316	76,760	132,203	(168,896)
Deferred
Total benefit (provision) for income taxes	$ (38,316)	$ (76,760)	$ (132,203)	$ 168,896

Subsequent Events (Details Narr

Subsequent Events (Details Narrative) - USD ($)	Nov. 07, 2018	Oct. 30, 2018	Oct. 03, 2018	Sep. 30, 2018
January 1, 2020 [Member]
Number of shares retired				120,000
Subsequent Event [Member]
Number of shares retired		72,324
Subsequent Event [Member] | Callable Preferred Stock [Member]
Preferred stock monthly dividend payment	$ 60,000		$ 60,000
Preferred stock dividend payment shares	5,000,000		5,000,000