Textiles Manufacturing Plant (Based on information from the Financial Times fDi Benchmark tool, May 2012)

Textiles Manufacturing Plant(Based on information from the Financial Times fDi Benchmark tool, May 2012)

Content

Competitiveness of Scotland

Value for Money

Overall Attractiveness

Quality of the Location

Annual Operating Costs

Quality Competitiveness

General Business Environment

Labour Availability and Quality

Presence of an Industrial Cluster

Infrastructure and Accessibility

Living Environment

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 a Textiles manufacturing

plant based on an analysis of over 55 quality factors and 10 cost factors

A key emphasis was placed on:

- Labour availability and quality – overall size of labour market, tightness and competition for

labour and experienced industry-specific staff

- Presence of industrial cluster – size of the industry, track record and export competitiveness

- Infrastructure and accessibility – access to major overseas markets, quality of local infrastructure

and quality of utilities

Other factors including the general business environment and living environment were also

assessed

Benchmarking Study

Project Profile Overview

Cost Factor Usage Amount

Property

Total Occupancy cost (industrial rent) 66,000 m²

Total Occupancy cost (in town office rent) 2,500 m²

Weighting Model Overview Weight

Labour Availability and Quality 50

Presence of an Industrial Cluster 20

Infrastructure and Accessibility 15

General Business Environment 10

Living Environment 5

Employee Type Profile Head count

Logistics and Purchasing

Warehouse and Distribution Operative 20

Manufacturing

Head of Manufacturing 10

Production Manager 15

Production Operative (Highly Skilled) 30

Production Operative (Skilled) 125

Production Operative (Unskilled) 620

R&D / Engineering

Engineer 10

Administration

Facilities/Office Services Specialist 55

Secretary 15

fDi Benchmark Matrix

The fDi Benchmark Matrix shows the trade off between cost and quality across the 4 selected locations for the Textiles manufacturing plant profile. The average cost and quality score is 100 for the selected locations.

Source: fDi Intelligence, from the Financial Times Ltd

The ‘ideal’ quadrant is the

top left

(high quality/lower operating costs)

fDi Benchmark Matrix

• The matrix is based on the weighting and cost model for the Textiles manufacturing plant 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 and Milan offer

higher quality but at higher cost Bradford and Warsaw offer lower cost, but

at lower quality

The Operating Cost value is in GBP - United Kingdom Pound

Location Qualitative ScoreOperating Cost

IndexOperating Cost

Value

Bradford 68.1 93.6 17,342,981

Milan 120.9 130.1 24,109,435

Scottish Central Belt 112.3 114.4 21,206,790

Warsaw 98.7 62.0 11,491,387


Location Attractiveness Index

The location attractiveness index shows the overall attractiveness of the 4 selected locations for the Textiles manufacturing plant profile. The ratio of quality to cost is 50:50


Cost Quality Competitiveness

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 Warsaw


Cost Competitiveness

The annual operating cost calculation for Textiles manufacturing plant is based on the following primary input costs: Labour Cost

The average cost across the selected locations for Textiles manufacturing plant is GBP 18,537,647 The greatest cost saving between the selected locations is GBP 12,618,049 per annum The values in the chart below are in GBP - United Kingdom Pound


Cost Competitiveness

Location Labour Cost Property

Bradford 12,917,603 4,425,377

Milan 19,578,305 4,531,130

Scottish Central Belt 14,721,296 6,485,492

Warsaw 6,406,078 5,085,308

The location with the lowest operating costs is Warsaw

In terms of the individual cost factors, the location with the lowest costs is:

Labour Cost: Warsaw Property: Bradford

The values in the table below are in GBP - United Kingdom Pound



The quality competitiveness assessment is based on the weight model for the Textiles manufacturing plant profile which assesses each location across the following location factors: General Business Environment, Labour Availability and Quality, Presence of an Industrial Cluster, Infrastructure and Accessibility and Living Environment. The average score for the selected locations is 100.

The location with the highest quality score is Milan



Location

General Business

Environment

Labour Availability and

QualityPresence of an

Industrial ClusterInfrastructure

and AccessibilityLiving

Environment

Bradford 13 35 4 11 4

Milan 19 54 32 11 5

Scottish Central Belt 15 66 16 10 5

Warsaw 12 45 28 8 6

In terms of the individual quality factors, the location with the highest score is:

General Business Environment: Milan Labour Availability and Quality: the Scottish Central Belt Presence of an Industrial Cluster: Milan Infrastructure and Accessibility: Bradford Living Environment: Warsaw



The quality competitiveness breakdown for General Business Environment for the Textiles manufacturing plant profile is shown below.

The location with the highest overall score for General Business Environment is Milan



Location

Economic growth and stability

Operating riskTaxation and

incentivesRegulatory

environment

Bradford 1.13 1.51 6.48 4.18

Milan 6.53 7.58 3.24 1.92

Scottish Central Belt 3.16 1.51 6.48 4.18

Warsaw 4.18 1.41 4.81 1.71

In terms of the individual quality criteria within General Business Environment, the location with the highest score is: Economic growth and stability: Milan Operating risk: Milan Taxation and incentives: the Scottish Central Belt Regulatory environment: the Scottish Central Belt



The quality competitiveness breakdown for Labour Availability and Quality for the Textiles manufacturing plant profile is shown below

The location with the highest overall score for Labour Availability and Quality is the Scottish Central Belt



LocationOverall size of labour market

Tightness and competition for

labour

Experienced industry-specific

staff

Flexibility of labour regulations

Bradford 2.61 10.90 3.34 17.99

Milan 22.58 5.72 14.16 11.43

Scottish Central Belt 13.26 9.63 25.56 17.99

Warsaw 11.55 3.74 16.95 12.59

In terms of the individual quality criteria within Labour Availability and Quality, the location with the highest score is: Overall size of labour market: Milan Tightness and competition for labour: Bradford Experienced industry-specific staff: the Scottish Central Belt Flexibility of labour regulations: the Scottish Central Belt



The quality competitiveness breakdown for Presence of an Industrial Cluster for the Textiles manufacturing plant profile is shown below

The location with the highest overall score for Presence of an Industrial Cluster is Milan



LocationSize of industry Track record

Bradford1.72 2.67

Milan19.15 13.33

Scottish Central Belt4.86 10.67

Warsaw14.28 13.33

In terms of the individual quality criteria within Presence of an Industrial Cluster, the location with the highest score is: Size of industry: Milan Track record: Warsaw



The quality competitiveness breakdown for Infrastructure and Accessibility for the Textiles manufacturing plant profile is shown below

The location with the highest overall score for Infrastructure and Accessibility is Bradford



Location

Access to major overseas markets

Quality of utilitiesQuality of ICT infrastructure

Bradford 6.93 3.72 0.53

Milan 6.66 3.47 0.44

Scottish Central Belt 5.76 3.72 0.49

Warsaw 4.65 3.08 0.54

In terms of the individual quality criteria within Infrastructure and Accessibility, the location with the highest score is: Access to major overseas markets: Bradford Quality of utilities: Bradford Quality of ICT infrastructure: Warsaw


Living Environment

The quality competitiveness breakdown for Living Environment for the Textiles manufacturing plant profile is shown below

The location with the highest overall score for Living Environment is Warsaw


Living Environment

Location

Cost of livingAttractiveness for international staff

Bradford2.74 1.70

Milan1.88 2.78

Scottish Central Belt2.69 2.32

Warsaw2.69 3.21

In terms of the individual quality criteria within Living Environment, the location with the highest score is: Cost of living: Bradford Attractiveness for international staff: Warsaw


To realise the potential,please contact:

Scottish Development International150 Broomielaw, Atlantic Quay Glasgow G2 8LU Scotland, UK T +44 141 228 2828F +44 141 228 2089www.sdi.co.uk

Worldwide offices in: Americas, Europe, Middle East, Africa and Asia Pacific

Documents

Textiles Manufacturing Plant (Based on information from the Financial Times fDi Benchmark tool, May 2012)