What term describes transferring operations to a foreign country with skilled, lower-cost labor?

What term describes transferring operations to a foreign country with skilled, lower-cost labor?

• A. Outsourcing
• B. Nearshoring
• C. Offshoring
• D. Reshoring

Answer: (C)

Offshoring is moving production or services to a foreign country to take advantage of skilled, lower-cost labor. The key idea is the location shift abroad—purposefully locating operations in another country to reduce costs while maintaining capabilities. This differs from outsourcing, which is about contracting work to an external provider (which could be anywhere), nearshoring, which targets a nearby country, and reshoring, which brings previously moved operations back to the home country. In this scenario, the emphasis on transferring operations to another country for cost-efficient skilled labor aligns with offshoring.

Offshoring is moving production or services to a foreign country to take advantage of skilled, lower-cost labor. The key idea is the location shift abroad—purposefully locating operations in another country to reduce costs while maintaining capabilities. This differs from outsourcing, which is about contracting work to an external provider (which could be anywhere), nearshoring, which targets a nearby country, and reshoring, which brings previously moved operations back to the home country. In this scenario, the emphasis on transferring operations to another country for cost-efficient skilled labor aligns with offshoring.