What does hub & spoke mean?

The hub-and-spoke system is a widely used logistics concept for the efficient organization of transport and goods flows. It is based on a star-shaped structure in which a central transshipment point, known as the hub, is connected to several regional distribution centers or destinations, known as spokes.

Instead of direct connections between all individual points, goods are bundled via the hub and then redistributed. This principle is used in particular in transport, freight forwarding, and warehouse logistics, as well as in air transport.

How it works

In the hub-and-spoke system, all incoming shipments are first transported to the central hub. There they are sorted and bundled before being forwarded to their respective destinations (spokes). In this way, many individual transport routes are replaced by a few bundled routes.

Example: A logistics company with five regional locations has to transport goods between all locations on a daily basis. Without a hub, ten direct routes would be necessary. With a central hub, the number of daily trips is significantly reduced, as each branch is now only connected to the hub.

Advantages of the hub & spoke system:

• Cost reduction through bundled transport
• Efficient utilization of vehicles and resources
• Central control enables better planning and monitoring
• Scalability, especially for growing networks
• Fewer empty runs and lower CO₂ emissions

The hub & spoke model offers an economically and logistically sensible solution for companies that want to manage large quantities of goods efficiently and centrally. It creates structure, reduces transport costs, and enables precise planning—provided that the central hub is efficient and well organized. This system has therefore become indispensable in modern logistics.