Scenario Planning: Best, Base, and Worst Case

A single-point forecast is always wrong — the future is uncertain and the question is not whether you will miss your forecast but by how much and in which direction. Scenario planning replaces a single forecast with three:

• Best case: What happens if conditions are more favourable than expected (higher conversion, faster growth, winning a big deal)?
• Base case: What happens if current trends continue (the most likely outcome)?
• Worst case: What happens if conditions deteriorate (key customer churns, platform algorithm change, cost spike)?

By planning all three, you know in advance what actions to take under each scenario — so when reality unfolds, you are not starting from scratch.

Go to Finance → Scenario Planner to create and manage your scenarios.

To build a new scenario:

1. Click New Scenario and give it a name (e.g. 'Q3 2025 — Bear Case')

2. Start from your base forecast (auto-populated from your revenue and cost data)

3. Apply adjustments using sliders or direct inputs:

• Revenue: adjust by % or £ amount, by channel or in total
• Gross margin: adjust for cost changes (e.g. supplier price increase)
• Fixed costs: add or remove cost lines
• One-off items: model the impact of a capital expenditure, tax payment, or large sale

4. View the output: revenue, gross profit, EBITDA, and cash position for each month under the scenario

The worst-case scenario is the most important one. Many businesses plan optimistically and are unprepared when things go wrong. A useful worst case should represent a realistic — not catastrophic — adverse scenario.

A useful worst-case framework:

• Revenue: your base case minus your largest single risk (e.g. losing your biggest customer, or a 20% platform revenue decline)
• Costs: assume no cost reduction flexibility — model costs as fixed even if some are variable
• Timing: assume cash comes in later than expected (add 15 days to debtor days)
• One-offs: include the adverse event you are hoping will not happen (the equipment failure, the regulatory fine)

If your business survives the worst case with positive cash and no insolvency risk, you are in a resilient position.

The value of scenario planning is not just knowing what could happen — it is knowing what you will do about it in advance. For each scenario, define the trigger that activates it and the actions you will take.

Example trigger table:

| Metric | Base Trigger | Action |

|---|---|---|

| Monthly revenue | -15% vs forecast for 2 consecutive months | Freeze discretionary spend, review headcount |

| Cash position | Below £50,000 | Draw on credit facility, accelerate collections |

| Gross margin | Below 35% | Review supplier pricing, pause low-margin channel |

Save your trigger table in Finance → Scenario Planner → Decision Triggers so it is visible when you review your dashboard each week.

Scenarios should be living documents, not one-off planning exercises. As each month's actuals come in, update your scenarios:

1. Check which scenario actual performance most closely matches

2. Update your base case to reflect the new starting position

3. Revise worst-case assumptions if conditions have improved, or tighten them if conditions have worsened

AskBiz prompts you to review your scenarios monthly — you will receive a notification in your Daily Brief if actuals have diverged from your base scenario by more than 15% in either direction.