Nearshoring, or more commonly “nearshore outsourcing,” is derived from the term “offshore outsourcing.” It is the practice of contracting business functions and processes to third party organizations in neighboring low-wage countries (e.g., from the United States to Canada or Mexico).

Due to the geographical proximity, nearshoring has several advantages over offshore outsourcing to distant foreign countries, such reduced time differences, shorter travel and transport distances, cultural affinity, better quality assurance, and lower vulnerability to privacy and copyright infringement.

See also: Offshoring/Offshore-Outsourcing, Outsourcing