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What’s the difference between offshoring and outsourcing?

Offshoring and outsourcing are two terms that are often used interchangeably, but they actually have different meanings.

Outsourcing refers to the practice of hiring another company or individual to perform tasks or provide services that would otherwise be done by in-house employees. For example, a company might outsource its accounting or IT department to a third-party provider.

Offshoring, on the other hand, refers specifically to the practice of moving business operations or processes to another country, often one with lower labor costs. This can include outsourcing, but it can also include other types of business activities, such as setting up manufacturing plants or research and development centers in another country.

In summary, outsourcing is the practice of delegating tasks or services to an external provider, whereas offshoring is the practice of moving business operations or processes to another country.

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