SodaStream planned to profit from its customer value proposition by sticking with its proven profit model. Like the famous Gillette “blade and razor” model, SodaStream’s profit model relied upon follow-up sales of flavor concentrates and gas cylinder refills. SodaStream starter kits accounted for about 43 percent of sales, while consumables (flavor syrups, bottles, and CO2 refills) generated 57 percent of revenues in 2012. SodaStream machines were profitable but generated gross margins of only an estimated 30 to 32 percent-well below the corporate average gross margin of 54 percent in 2012. In contrast, the consumables business had gross margins of an estimated 72 percent. While the CO2 refill business produced significantly smaller revenues than sales of flavors and bottles, the refill canisters had astonishingly high gross margins of an estimated 85 to 90 percent.19 The relatively small plastic bottle segment had the next best gross margins-an estimated 60 to 62 percent. The flavor concentrate business also was very profitable one with gross margins of an estimated 58 percent.