What is a characteristic of offshore outsourcing?

What is a characteristic of offshore outsourcing?

• A. Importing products from another country
• B. Outsourcing to a foreign location
• C. Local outsourcing to domestic firms
• D. Subcontracting only within the same country

Answer: (B)

Offshore outsourcing specifically refers to the practice of contracting work to be completed in a different country, typically where labor costs are lower. This strategy allows companies to leverage cost efficiencies, access specialized skills, and increase their competitiveness in the global market. By relocating certain business processes or services, firms can focus on their core activities and improve operational effectiveness while benefiting from the economic advantages of international labor markets. The other options do not accurately reflect offshore outsourcing. Importing products from another country involves the purchase and transport of goods rather than the outsourcing of services or processes. Local outsourcing pertains to hiring domestic firms, which negates the “offshore” aspect of the practice. Subcontracting only within the same country similarly misses the key characteristic of operating across national borders, which is central to the definition of offshore outsourcing.

Offshore outsourcing specifically refers to the practice of contracting work to be completed in a different country, typically where labor costs are lower. This strategy allows companies to leverage cost efficiencies, access specialized skills, and increase their competitiveness in the global market. By relocating certain business processes or services, firms can focus on their core activities and improve operational effectiveness while benefiting from the economic advantages of international labor markets.

The other options do not accurately reflect offshore outsourcing. Importing products from another country involves the purchase and transport of goods rather than the outsourcing of services or processes. Local outsourcing pertains to hiring domestic firms, which negates the “offshore” aspect of the practice. Subcontracting only within the same country similarly misses the key characteristic of operating across national borders, which is central to the definition of offshore outsourcing.