What Are the Advantages of the Hub and Spoke Distribution Model?

Posted by Port City Logistics on Aug 26, 2021 10:12:27 AM

Peak season seems to sneak up on supply chain professionals each year, but being ready with a hub and spoke distribution model will help navigate the ever-growing global demand. Utilizing intermodal shipping and omnimodal shipping, shippers can reach a more extensive network of customers without the price tag. In addition to the savings, this distribution model enhances more complicated shipping modes while optimizing route planning, boosting productivity, and improving customer service. Increasing demand means finding alternative shipping methods, and this distribution model can get companies from A to B more efficiently. Here are a few more benefits.

1. Simplifies An Otherwise Complicated Shipping Process for LTL

Maneuvering through supply chain hurdles for shippers who need LTL or PTL services can prove complicated. A hub and spoke distribution model makes finding and using shared truckload spaces easier for distributors. Without this process, intermodal and omnimodal shipping carries a hefty price tag and takes longer. As well as lengthy shipment times, the potential for delays increases. This model simplifies those processes for shippers who need shared truck spaces.  

2. Lowers Overall Costs Via Omnimodal Shipping

The most significant advantage to the hub and spoke distribution model utilization is its cost-effectiveness. With this method, goods move through the supply chain faster with fewer steps. From the order inception or origin point, it then goes back for processing and distributed directly from the center of the hub. These, partnered with shared truckload spaces, reduces the costs related to shipping on a larger scale, according to SupplyChainBrain

3. Boosts Productivity by Orchestrating Steps For Workers

As the industry reaches peak shipping season, productivity remains a focal point for efficiency. These processes work better with this distribution model because it implements ways for employees also to reduce their steps. Without the load, unload, reload, and transport from one area to another, team members can focus on their tasks. This eliminates repetitive, double-touch activity. Hub and spoke distribution focuses on orchestrating and reducing steps to improve productivity across the supply chain. 

4. Enhances Route Planning for Faster and More On-Time Deliveries

Other added benefits of a hub and spoke distribution model such as route optimization mean faster, more on-time delivery. According to Inbound Logistics, they can use this model to find non-dedicated drivers to cast a broader net to fulfill capacity and lower costs related to hiring staff to make this mass coordination happen. With the right technology, constant updates and rerouting eliminates extra drive time, keeps carriers on the road, and gets them back for more freight faster. Shippers and carriers strengthen their trust by increasing their ability to fulfill their obligations. 

5. Centralized Locations Allow More Direct Access For Distributors 

Additional methods to improve e-commerce shipping, like implementing a hub and spoke distribution model, mean more direct access for distributors. The more centralized a location, the better a shipment can move through the supply chain without excessive transport and extra cost. Centralizing location hubs makes dispatching more loads in 24 hours more manageable and more efficient. 

6. More Flexibility Means Better Customer Service

Whether shippers ship freight internationally or domestically, using this model will improve customer service. With a hub and spoke distribution model, more shipments can go out at a much faster rate. Decreasing delays means carriers can provide superior service that can reduce damaged goods and missed arrival times. 

Take Advantage of All Hub and Spoke Distribution by Partnering With Port City Logistics

Overall, this model improves many areas of shipping. With the growing demand, faster shipping is more important than ever. Cost-saving measures like these keep drivers on the road and shipments arriving on time. Taking advantage has never been easier, so contact Port City Logistics today

Topics: hub and spoke distribution