The key for me relates to the China contracts:"Three other China...

The key for me relates to the China contracts:

"Three other China District Councils continued to be supplied under trials with commercial decision expect in 2013."

"In the December 2012 quarter, Cardia secured an exclusive annual $1.2m supply contract with China’s Pudong City District in Shanghai, to supply Cardia’s renewable kitchen waste bags to approximately 20% of the 5 million householders in the Shanghai Pudong City
District.

The order follows a six months trial covering about 5% of householders. Cardia believes there is potential to further expand the rollout in the future.
Shanghai-Pudong is one of four City Councils in China that has conducted waste management trials using Cardia products. The other three Councils are still in trial
phase and are Nanjing, Hangzhou and Yuhang district councils with Cardia looking to expand into other provinces of China."

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So the Pudong trial was to 5% of the householders and the contract is now to 20% of the householders - a 4-fold rise in volume.

The existing trials continue - great news that we did not know about.

Looking to expand into other provinces - yes - great!

Okay, so this for me is the ultimate in consumables.

So if we can convert from trials to contracts, there is an immediate ramp up in volume, with potential for even greater ramp ups under the same contracts (5% trial to 20% contract to xx% as confidence in this enviro friendly space and demand grows).

The more contracts we get, the more Cardia will become the "standard" in this space and of all places on earth that one could hope to be the defacto standard for supply of consumables, China is it!

Now the final piece of the puzzle - profit margin - this is the final piece of the puzzle.

Have we reached critical mass?
Do economies of scale continue to kick in as volumes grow? Are we making a good profit moving forward now that the Pudong trial is increasing 4-fold to a contract?

These for me are the key questions that are still unanswered, but that hold the key to unlocking massive value in this stock, especially from the current SP base.

One thing for sure - we are still the early movers in this stock. There is plenty more upside (in multiples) than downside!