  Labor displacement off-or nearshore is a performance improvement instrument
that currently sparks a lot of interest in the service sector. This article
proposes a model to understand the consequences of such a decision on
management consulting firms. Its calibration on the market of consulting
services for the German transportation industry highlights that, under
realistic assumptions, labor displacement translates in price decrease by-0.5%
on average per year and that for MC practices to remain competitive/profitable
they have to at least increase the amount of work they off/nears shore by +0.7%
a year.
