Relocation special: Home of the brave
Cutting your overheads
The cheaper overheads to which Johnson refers are mainly labour and property. The latter in particular are a huge bonus for businesses moving to Scotland, certainly when compared with the Southeast of England. Prime city centre office space in Edinburgh costs around £27 per sq ft; Glasgow is slightly cheaper at around £25 per sq ft. Prime space in London, by comparison, is around £45 per sq ft upwards. Outside the two main Scottish commercial centres it gets cheaper still: from around £13.50 per sq ft in Dundee to as low as £4 in Inverness, the capital of the Highlands.
Property was one of the reasons that the Essentia Group chose Brora, 60 miles north of Inverness, to locate a new contact centre. The Essentia Group provides outsourced information and advice services in health and lifestyle management. It already had centres in Newcastle and Glasgow, but was looking to expand its range of operations.
‘Brora offered ready-built, hi-tech premises, and the costs are cheaper in the Highlands than virtually anywhere else in the UK. It is as much as £20 per sq ft lower than similar properties in Edinburgh or Glasgow,’ says Peter Carragher, director of operations.
In addition, the local enterprise agency, Caithness and Sutherland Enterprise, was able to capitalise on the Highlands and Islands’ status as Objective One areas for European funding, in order to put together a £350,000 investment package to help the Essentia Group with set-up costs, equipment and training.
Contact centres are a growing strength of the Highlands and Islands. According to a survey by inward investment consultancy Tenon Techlocate, the region can offer cost savings of up to 40 to 50 per cent on salaries and property compared to Southeast England, while maintaining the same – if not higher – levels of security and service. Major contact centre operators such as BT, Vertex, Cap Gemini and Viewpoint all have facilities here.
The buoyant commercial sector in Scotland, however, is starting to put pressure on property prices, particularly in the main cities. Campbell Hart, a partner in the Glasgow office of property agents King Sturge, warns that ‘with rents beginning to rise in the Glasgow office market, now is the time to make your move if you want to get maximum value for money’.
The sheer availability of top quality space can also be an issue, with the Edinburgh office market facing a shortage of grade-A space, which in turn is putting added pressure on rents.
Right people for the job
The other key overhead is labour and in this regard the benefits of Scotland are less clear-cut. Salary levels in the main commercial centres are not hugely different to comparable jobs elsewhere in the UK, although it varies according to the industry and the precise location. The salary for a highly qualified scientist in Dundee or senior financial services manager in Edinburgh is going to be roughly the same as anywhere else. However, at a general mid-management level, there is the potential for significant cost savings in secondary commercial centres such as Perth or Stirling.
Cost isn’t everything, though. For many businesses, it is the type and availability of labour that’s decisive, not the associated cost. ‘We deal with health and medical advice and counselling, so we need specialist expertise such as counsellors, nurses and ex-NHS staff. It was vital that this kind of labour was available to us in Brora, so we held an open day to gauge local interest and suitability. The results were a great success,’ says Carragher.
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