For this week’s Logistics Glossary Week post, we’re going to focus on hubs! What exactly is a hub? Well, it actually has many definitions. In the computing sense, a hub can refer to a common connection point for devices in a network. For example, a web hub was one of the initial names to what we now refer to as a portal. But what about the logistics sense? We see articles today that are discussing possible new logistics hubs for manufacturing or where the best logistics hubs are per region. So we thought that for this month’s blog post, we’d give you the breakdown on the logistics ‘hub.’
Logistics Hub
Definition: In logistics terminology, a ‘hub’ is a reference for a transportation network as a “hub and spoke.” The term is commonly used in the airline and trucking industry. A hub in the logistics sense serves as the focal point; its purpose is to handle the flow of good and other resources between the points of origin to destination in order to meet transportation requirements.
Logistics hubs can be mainly one form of transportation such as trucking terminals, rail hubs, or even a hub airport. All refer to the same idea. For example, a hub airport serves as the focal point for the origin and termination of long distance flights (flights from outlying areas meet connecting flights at the hub airport). But, it can also be a…
Multimodal Logistics Hub
Definition: A logistics hub that has more than one mode of transportation (truck, rail, sea, air, etc.) that handles the flow of goods and resources between the point of origin to destination in order to meet transportation demands and requirements.
Value Proposition
Definition: value proposition is particularly important to the definition of logistics hubs because in order for a logistics hub to be truly effective, there has to be value in using a particular location as a hub. Ideally the proposition is two-sided; meaning that the hub is a benefit to both buyers and sellers.
Hubs can be created organically due to pragmatic solutions stemming from a particular location. For example, logistics hubs can be near or around many manufacturing plants and companies that offer warehousing solutions. Furthermore, it could also be easy access between different modes of transportation such as truck and rail. This provides easy intermodal exchanges, like transporting goods from truck to rail. Because of this, routes are created and these hubs offer the benefit of convenience and potential cost savings for both suppliers and consumers.
And that’s all for us this week! Hope you have a happy Halloween and a great weekend! If you liked this blog post, why not subscribe to our blog? If you’re interested in what we do as a 3rd party logistics provider, don’t hesitate to check out our services (as expressed above, we are very pro finding you the lowest total cost!). We’re also in the twittersphere, so give us a follow to get the latest logistics and supply chain news! See you in November!
