Establishing a Life Sciences R&D Centre in the Scottish Central Belt A cost/quality comparison...
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Transcript of Establishing a Life Sciences R&D Centre in the Scottish Central Belt A cost/quality comparison...
Establishing a Life Sciences R&D Centre in the Scottish Central BeltA cost/quality comparison(Based on information from the Financial Times fDi Benchmark tool – June 2011)
Competitiveness of Scottish Central Belt
Value for Money
Overall Attractiveness
Quality of the Location
Annual Operating Costs
Life Science R&D in Scottish Central Belt?
Large Size of Industry in Life Science
Strong Track Record in Life Sciences
Availability of Highly Skilled Staff
High Quality Business Environment
Flexible Labour Market
Highly Competitive Labour Costs
Contents
• The following analysis is based on fDi Benchmark, an online location benchmarking tool provided by
the Financial Times (FT)
• fDi Benchmark compared the Scottish Central Belt with the leading locations globally for Life Science R&D Centres
based on an analysis of over 55 quality factors and 10 cost factors
• A key emphasis was placed on:
- Presence of industrial cluster – the size of BioPharma industry, track record and R&D
capabilities; and
- General business environment – regulatory environment, operating risk, taxation and
economic growth and stability
- Costs to employ laboratory specialists and scientists
• Other factors including labour availability and quality, accessibility and the living environment were
also assessed
Benchmarking Study
The fDi Benchmark Matrix shows the trade off between cost and quality across the 5 selected locations for the Life Science R&D Centre profile. The average cost and quality score is 100 for the selected locations.
Source: fDi Intelligence, from the Financial Times Ltd
fDi Benchmark Matrix
The ‘ideal’ quadrant is the
top left
(high quality/lower operating costs)
Cost Factor Usage AmountProperty Total Occupancy cost (in town office rent) 3,000 m²
Weighting Model Overview WeightPresence of an Industrial Cluster 50Labour Availability and Quality 20General Business Environment 15Living Environment 10Infrastructure and Accessibility 5
Employee TypeProfile Head
countR&D / Engineering Head of Research and Development 1Laboratory Specialist 17Laboratory Technician 15R&D Team Leader 4Scientist 10Administration Facilities/Office Services Specialist 3
5
Project Profile Overview
• The matrix is based on the weighting and cost model for the Life Science R&D Centre profile. The weighting model identifies the key location criteria for the project and the cost model shows the primary cost inputs for the operation. The cost and quality scores are calculated using real data on all the location requirements and cost inputs.
• The results indicate the different location solutions for the investor as follows:
the Scottish Central Belt offers higher quality at lower cost than the average of all the selected locations
Boston and Munich offer higher quality but at higher cost
Copenhagen and Rotterdam offer lower cost, but at lower quality
• The Operating Cost value is in GBP - United Kingdom Pound
LocationQualitative
ScoreOperating Cost
IndexOperating Cost
Value
Boston (MA) 128.4 133.0 4,608,589
Copenhagen 93.8 91.1 3,158,947
Munich 110.6 113.6 3,937,999
Rotterdam 46.7 79.0 2,737,827Scottish Central Belt 120.5 83.3 2,886,411
Source: fDi Intelligence, from the Financial Times Ltd
fDi Benchmark Matrix
The location attractiveness index shows the overall attractiveness of the 5 selected locations for the Life Science R&D Centre profile. The ratio of quality to cost is 50:50
Source: fDi Intelligence, from the Financial Times Ltd
Location Attractiveness Index
The cost quality competitiveness uses the results of the fDi Benchmark Matrix to show the value for money of each location option. The graph shows that:
The top location offering the highest quality for a given level of cost is the Scottish Central Belt the Scottish Central Belt also offers an above average level of quality and good value for money as its relative
quality is higher than its relative cost
Source: fDi Intelligence, from the Financial Times Ltd
Cost Quality Competitiveness
The annual operating cost calculation for Life Science R&D centre is based on the following primary input costs:
Labour Cost
- The average cost across the selected
locations for Life Science R&D centre is
GBP 3,465,954
- The greatest cost saving between the
selected locations is GBP 1,870,762 per
annum
- The location with the lowest operating costs is Rotterdam
In terms of the individual cost factors, the location with the lowest costs is:
- Labour Cost: the Scottish Central Belt - Property: Rotterdam
The values in the chart below are in GBP
United Kingdom Pound
Source: fDi Intelligence, from the Financial Times Ltd
Location Labour Cost PropertyBoston (MA) 3,658,046 950,542Copenhagen 2,446,628 712,319Munich 2,876,395 1,061,603Rotterdam 2,197,275 540,551Scottish Central Belt 1,648,393 1,238,017
Cost Competitiveness
The quality competitiveness assessment is based on the weight model for the Life Science R&D Centre profile which assesses each location across the following location factors: - General Business Environment - Labour Availability and Quality - Presence of an Industrial Cluster Infrastructure - Accessibility and Living Environment
The average score for the selected locations is 100.
The location with the highest quality score is Boston
In terms of the individual quality factors, the location with the highest score is:
- General Business Environment: Copenhagen - Labour Availability and Quality: Boston - Presence of an Industrial Cluster: Boston - Infrastructure and Accessibility: Munich - Living Environment: the Scottish Central Belt
Source: fDi Intelligence, from the Financial Times Ltd
Location
General Business
Environment
Labour Availability and Quality
Presence of an Industrial
Cluster
Infrastructure and
AccessibilityLiving
Environment
Boston (MA) 16 26 73 4 11Copenhagen 20 23 35 7 9Munich 11 16 67 7 9Rotterdam 12 10 10 4 10Scottish Central Belt 16 25 65 4 11
Quality Competitiveness
The quality competitiveness breakdown for General Business Environment for the Life Science R&D Centre profile is shown below
The location with the highest overall score for General Business Environment is Copenhagen
In terms of the individual quality criteria within General Business Environment, the location with the highest score is:
- Economic growth and stability: Boston - Operating risk: the Scottish Central Belt - Taxation and incentives: Copenhagen - Access to finance: Boston - Regulatory environment: Copenhagen
Source: fDi Intelligence, from the Financial Times Ltd
LocationEconomic
growth and stability
Operating riskTaxation and
incentivesAccess to
financeRegulatory
environment
Boston (MA) 1.29 4.76 2.42 4.20 2.86Copenhagen
0.64 2.88 9.19 3.53 3.57
Munich 0.88 2.33 2.10 3.34 2.63Rotterdam 0.50 2.41 2.42 4.05 3.05Scottish Central Belt
0.45 6.37 2.63 3.64 2.89
General Business Environment
The quality competitiveness breakdown for Labour Availability and Quality for the Life Science R&D Centre profile is shown below
The location with the highest overall score for Labour Availability and Quality is Boston
In terms of the individual quality criteria within Labour Availability and Quality, the location with the highest score is:
- Overall size of labour market: Boston-Tightness and competition for labour: the Scottish Central Belt- Experienced industry-specific staff: the Scottish Central Belt- Flexibility of labour regulations: Copenhagen
Source: fDi Intelligence, from the Financial Times Ltd
LocationOverall size of labour market
Tightness and competition for
labour
Experienced industry-
specific staff
Flexibility of labour
regulationsBoston (MA) 13.41 3.96 6.26 2.41Copenhagen
3.55 4.23 11.23 3.73
Munich 4.96 2.27 7.87 0.99Rotterdam 2.47 4.65 2.05 1.06Scottish Central Belt
5.61 4.89 12.59 1.80
Labour Availability and Quality
The quality competitiveness breakdown for Presence of an Industrial Cluster for the Life Science R&D Centre profile is shown below
The location with the highest overall score for Presence of an Industrial Cluster is Boston
In terms of the individual quality criteria within Presence of an Industrial Cluster, the location with the highest score is:
- Size of industry: Munich - Track record: the Scottish Central Belt - Research and Development Capabilities: Boston
Source: fDi Intelligence, from the Financial Times Ltd
Location
Size of industry
Track recordResearch and Development Capabilities
Boston (MA) 16.77 19.61 36.13Copenhagen 7.93 18.44 8.83Munich 43.83 13.28 10.11Rotterdam 6.58 0.00 3.21Scottish Central Belt
24.89 36.17 4.22
Presence of an Industrial Cluster
The quality competitiveness breakdown for Infrastructure and Accessibility for the Life Science R&D Centre profile is shown below
The location with the highest overall score for Infrastructure and Accessibility is Munich
In terms of the individual quality criteria within Infrastructure and Accessibility, the location with the highest score is:
- Access to major overseas markets: Munich- Quality of utilities: Rotterdam- Quality of ICT infrastructure: Copenhagen
Source: fDi Intelligence, from the Financial Times Ltd
LocationAccess to major
overseas marketsQuality of utilities
Quality of ICT infrastructure
Boston (MA) 2.26 0.87 0.62Copenhagen 4.12 0.96 1.60Munich 4.97 1.12 0.81Rotterdam 1.40 1.18 1.37Scottish Central Belt 2.25 0.87 0.61
Infrastructure and Accessibility
The quality competitiveness breakdown for Living Environment for the Life Science R&D Centre profile is shown below
The location with the highest overall score for Living Environment is the Scottish Central Belt
In terms of the individual quality criteria within Living Environment, the location with the highest score is:
- Cost of living: the Scottish Central Belt- Attractiveness for international staff: Boston
Source: fDi Intelligence, from the Financial Times Ltd
LocationCost of living
Attractiveness for international staff
Boston (MA) 4.96 5.63Copenhagen 4.06 5.34Munich 4.11 4.96Rotterdam 5.86 4.41Scottish Central Belt 6.01 4.66
Living Environment