Break-even analysis for service businesses is the process of studying how much income must be generated in order to cover expenses, and at what point a business will become profitable from its operations. It’s a great way for business owners to assess the financial viability of their operations and whether or not they should go ahead with a certain venture or project. In essence, it seeks to determine the exact point where a business breaks even – when total income matches total expenses. With break-even analysis, entrepreneurs can gain a better understanding of the different revenue streams that are necessary to keep their business afloat, as well as what level of sales needs to be reached in order to turn a consistent profit.