I understand the following:
Costs:
Kickstart costs of $13,500 in y0 (or beginning of year 1). Other costs (drinking wine, investing wine, maintenance) of 13,200/yr x 5 years = $66,000.
Revenue:
120 investment bottles (from kickstart invest) * $250/bottle = $30K after 5 years.
72 bottles * $250/bottle = $18K after 5 years.
Profit:
$30K + $18K - $13.5K - $66K = - $32K.
Brek Even:
- $32K / $4.8K ($18K - $13.2K) = 6.6 years (round to 7 years)
If I assume that we have a gross margin of $4.8K / yr after year 6 and we have an additional 7 years, I get 13 years. Not 15. What am I missing?
Thanks in advance!