1. Establishing a Regional HQ in the Scottish Central Belt A cost/quality comparison (Based on information from the Financial Times fDi Benchmark tool – April 2012)

2. Competitiveness of Scottish Central Belt 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 Contents

3. 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 establishing a Regional HQ 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 the industry, track record and R&D capabilities; and - General business environment – regulatory environment, operating risk, taxation and economic growth and stability Other factors including labour availability and quality, accessibility and the living environment were also assessed Benchmarking Study

4. Project Profile Overview Cost FactorUsage Amount Property Total Occupancy cost (in town office rent)1,500 m² Telecoms National Call2,300 Mins Intl Call to US (International Call)3,450 Mins Intl Call to France3,450 Mins Intl Call to Germany3,450 Mins Intl Call to Italy3,450 Mins Intl Call to Sweden3,450 Mins Intl Call to China3,450 Mins Intl Call to Singapore3,450 Mins Intl Call to India3,450 Mins Intl Call to Brazil3,450 Mins Intl Call to Mexico3,450 Mins Weighting Model OverviewWeight Presence of an Industrial Cluster35 Infrastructure and Accessibility15 Living Environment10 General Business Environment15 Labour Availability and Quality25 Employee TypeProfile Head count General Management Group/Regional Chief Executive1 Regional Business Unit Manager4 Finance Chief Accountant7 Head of Finance and Administration1 Marketing Product Manager12 Administration Executive Secretary1 Facilities/Office Services Specialist17 Regulatory Affairs Manager2 Secretary5 Project Profile Overview

5. The fDi Benchmark Matrix shows the trade off between cost and quality across the 7 selected locations for the Regional headquarters 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

6. The matrix is based on the weighting and cost model for the Regional headquarters 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  Berlin and Stockholm offer higher quality but at higher cost  Birmingham, Leeds, Newcastle offer lower cost, but at lower quality The Operating Cost value is in GBP - United Kingdom Pound LocationQualitative Score Operating Cost Index Operating Cost Value Berlin180.7112.35,317,438 Birmingham84.091.94,352,241 Leeds68.491.04,310,168 Newcastle55.387.14,125,210 Rome90.3113.25,360,155 Scottish Central Belt119.084.74,013,055 Stockholm102.2119.85,675,464 Source: fDi Intelligence, from the Financial Times Ltd fDi Benchmark Matrix

7. Location Attractiveness Index The location attractiveness index shows the overall attractiveness of the 7 selected locations for the Regional headquarters profile. The ratio of quality to cost is 50:50 Source: fDi Intelligence, from the Financial Times Ltd Location Attractiveness Index

8. 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 locations offering the highest quality for a given level of cost are the Scottish Central Belt and Berlin  the Scottish Central Belt and Berlin offer an above average level of quality and good value for money as there relative quality is higher than their relative cost. Source: fDi Intelligence, from the Financial Times Ltd Cost Quality Competitiveness

9. Cost Competitiveness The annual operating cost calculation for Regional headquarters is based on the following primary input costs: Labour Cost, Property and Telecoms  The average cost across the selected locations for Regional headquarters is GBP4,736,245  The greatest cost saving between the selected locations is GBP1,662,409 per annum  The values in the chart below are in GBP - United Kingdom Pound Source: fDi Intelligence, from the Financial Times Ltd Cost Competitiveness

10. LocationLabour CostPropertyTelecoms Berlin4,872,868375,53169,037 Birmingham3,633,993657,13061,117 Leeds3,628,512620,53761,117 Newcastle3,534,612529,47961,117 Rome4,581,829634,312144,011 Scottish Central Belt3,332,928619,00861,117 Stockholm4,956,941707,71910,802 The locations with the lowest operating costs are Newcastle and the Scottish Central Belt In terms of the individual cost factors, the locations with the lowest costs are:  Labour Cost: Newcastle and the Scottish Central Belt  Property: Berlin and Newcastle  Telecoms: Stockholm and the Scottish Central Belt The values in the table below are in GBP - United Kingdom Pound Source: fDi Intelligence, from the Financial Times Ltd Cost Competitiveness

11. Quality Competitiveness The quality competitiveness assessment is based on the weight model for the Regional headquarters 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 locations with the highest quality scores are the Scottish Central Belt and Berlin Source: fDi Intelligence, from the Financial Times Ltd Quality Competitiveness

12. Location General Business Environment Labour Availability and Quality Presence of an Industrial Cluster Infrastructure and Accessibility Living Environment Berlin1439981911 Birmingham172420139 Leeds16 12159 Newcastle16137109 Rome1129221810 Scottish Central Belt1634471210 Stockholm1519381812 In terms of the individual quality factors, the locations with the highest scores are:  General Business Environment: the Scottish Central Belt and Birmingham  Labour Availability and Quality: the Scottish Central Belt and Berlin  Presence of an Industrial Cluster: the Scottish Central Belt and Berlin  Infrastructure and Accessibility: Rome and Berlin  Living Environment: Berlin and Stockholm Source: fDi Intelligence, from the Financial Times Ltd Quality Competitiveness

13. General Business Environment The quality competitiveness breakdown for General Business Environment for the Regional headquarters profile is shown below The locations with the highest overall scores for General Business Environment are the Scottish Central Belt and Birmingham Source: fDi Intelligence, from the Financial Times Ltd General Business Environment

14. Location Economic growth and stability Operating risk Taxation and incentives Regulatory environment Berlin 1.804.734.782.52 Birmingham 1.745.736.143.19 Leeds 1.065.736.143.19 Newcastle 0.875.736.143.19 Rome 2.003.743.271.75 Scottish Central Belt 1.275.736.143.19 Stockholm 1.765.344.143.95 In terms of the individual quality criteria within General Business Environment, the locations with the highest scores are:  Economic growth and stability: Rome and Berlin  Operating risk: Brermingham and the Scottish Central Belt  Taxation and incentives: the Scottish Central Belt and Birmingham  Regulatory environment: Stockholm and the Scottish Central Belt Source: fDi Intelligence, from the Financial Times Ltd General Business Environment

15. Labour Availability and Quality The quality competitiveness breakdown for Labour Availability and Quality for the Regional headquarters profile is shown below The locations with the highest overall scores for Labour Availability and Quality are the Scottish Central Belt and Berlin Source: fDi Intelligence, from the Financial Times Ltd Labour Availability and Quality

16. Location Overall size of labour market Tightness and competition for labour Experienced industry-specific staff Flexibility of labour regulations Berlin 10.921.6722.144.03 Birmingham 8.071.616.567.93 Leeds 4.281.122.947.93 Newcastle 3.131.221.137.93 Rome 8.461.2015.144.13 Scottish Central Belt 5.261.1019.857.93 Stockholm 3.630.8210.993.85 In terms of the individual quality criteria within Labour Availability and Quality, the locations with the highest scores are:  Overall size of labour market: Rome and Berlin  Tightness and competition for labour: Berlin and Birmingham  Experienced industry-specific staff: berlin and the Scottish Central Belt  Flexibility of labour regulations: the Scottish Central Belt and Newcastle Source: fDi Intelligence, from the Financial Times Ltd Labour Availability and Quality

17. Presence of an Industrial Cluster The quality competitiveness breakdown for Presence of an Industrial Cluster for the Regional headquarters profile is shown below The locations with the highest overall scores for Presence of an Industrial Cluster are the Scottish Central Belt and Berlin Source: fDi Intelligence, from the Financial Times Ltd Presence of an Industrial Cluster

18. Location Size of industryTrack record Berlin 62.1136.15 Birmingham 11.269.13 Leeds 9.183.06 Newcastle 7.130.29 Rome 21.101.17 Scottish Central Belt 23.4323.27 Stockholm 12.7824.92 In terms of the individual quality criteria within Presence of an Industrial Cluster, the locations with the highest scores are:  Size of industry: Berlin and the Scottish Central Belt  Track record: Stockholm and Berlin Source: fDi Intelligence, from the Financial Times Ltd Presence of an Industrial Cluster

19. Infrastructure and Accessibility The quality competitiveness breakdown for Infrastructure and Accessibility for the Regional headquarters profile is shown below The locations with the highest overall scores for Infrastructure and Accessibility are Rome and Berlin Source: fDi Intelligence, from the Financial Times Ltd Infrastructure and Accessibility

20. Location Access to major overseas markets Quality of utilities Quality of ICT infrastructure Berlin 11.354.792.43 Birmingham 7.573.622.10 Leeds 9.463.622.05 Newcastle 4.563.621.73 Rome 13.663.371.19 Scottish Central Belt 6.583.621.61 Stockholm 9.813.614.65 20 In terms of the individual quality criteria within Infrastructure and Accessibility, the locations with the highest scores are:  Access to major overseas markets: Rome and Berlin  Quality of utilities: Berlin and the Scottish Central Belt  Quality of ICT infrastructure: Stockholm and Berlin Source: fDi Intelligence, from the Financial Times Ltd Infrastructure and Accessibility

21. Living Environment The quality competitiveness breakdown for Living Environment for the Regional headquarters profile is shown below The locations with the highest overall scores for Living Environment are Stockholm and Berlin Source: fDi Intelligence, from the Financial Times Ltd Living Environment

22. Location Cost of living Attractiveness for international staff Berlin 2.838.45 Birmingham 3.236.07 Leeds 3.135.52 Newcastle 3.105.55 Rome 2.617.55 Scottish Central Belt 3.406.60 Stockholm 2.719.26 In terms of the individual quality criteria within Living Environment, the locations with the highest scores are:  Cost of living: Birmingham and the Scottish Central Belt  Attractiveness for international staff: Berlin and Stockholm Source: fDi Intelligence, from the Financial Times Ltd Living Environment

23. To realise the potential, please contact: Scottish Development International 150 Broomielaw, Atlantic Quay Glasgow G2 8LU Scotland, UK T +44 141 228 2828 F +44 141 228 2089 www.sdi.co.uk Worldwide offices in: Americas, Europe, Middle East, Africa and Asia Pacific