Best-Case Scenario

A best-case scenario combines favourable assumptions, such as strong sales growth, higher prices, lower costs and a successful product launch, to show the upper range of likely outcomes.

For example, a company's base case might forecast sales of 10 million next year. Its best case might assume a large new contract and strong market demand, leading to sales of 13 million and much higher profit.

The best case is useful for planning. It helps a business prepare for success, for instance by ensuring it could supply enough products, hire quickly enough or have the cash to fund rapid growth, which often ties up working capital.

It should still be realistic. A best case built on assumptions that are very unlikely to happen can lead to overconfidence or poor investment decisions. It is most useful when viewed alongside the base case and worst case, showing the full range of possible results.

Note: An upside case is very similar to a best-case scenario. Some analysts use "upside case" for a moderately optimistic outcome and keep "best case" for the most favourable plausible one.