Hello Angela
Before we understand more about the ‘offset’ setting in the Slic3r software, let us recall that extruder’s job is to deposit or extrude plastic at a designated space co-ordinate on X, Y and Z axis relative to origin (0,0), a fixed point in space.
In the case of a multi extruder printer, each extruder would be generally used for a different material. Only one of these extruders can be set to origin. Rest of the extruders would be at a different position relative to the origin. This difference is called the offset.
The offset has to be catered for, in the G-code. This would enable the next extruder to take over exactly from where the last extruder has left. Generally, this is catered for, by the firmware. The offset setting in Slic3r software is to be used when the firmware does not cater for it.
If the offset value is not set correctly, the extruders would be printing at wrong points in space, even though the code might be pointing to the correct point in space.