DISTRIBUTION MODELS

HUB AND SPOKE MODEL

The hub and spoke model is certainly a more flexible and profitable distribution network ensuring a
smooth flow of goods compared to the old-school point-to-point model. Hub and spoke networks
are also best-suited for companies in the food delivery and hyperlocal delivery market with bulk
orders within a fixed radius. A hub n spoke model allows delivery partners to plan their daily delivery
routes around one hub, finish deliveries in a particular region, and then move on to another hub for
any on-demand or extra deliveries.

ADVANTAGES:

Faster deliveries

Lower logistics cost

HOPSCOTCH MODEL

In this shape, the salesperson begins from the last point from office and reach out the customers while
coming back to the office. While going, the salesperson does not stop anywhere and attends calls in
one direction while coming back to the office.
MILK RUN MODEL

This method of transport got its name from the dairy industry
practice, where one tanker used to collect milk from several
dairy farms for delivery to a milk processing company. This is
based on catchment area.
When the clients are distributed evenly throughout an area, the sales manager chooses the circle
shape. The salesperson starts from the office, moves in a circle of stops until he reaches the office
again. This helps the salesperson to come near to the customer as compared to the wedge.

ADVANTAGES
Full utilization of delivery vehicle
Reduce delivery costs
Improved effi ciency
Improved quality of service
CLOVER LEAF MODEL

When the accounts or client are located randomly in a geographical area, the cloverleaf shape is used.
This type of shape is more often found in industrial markets than in consumer markets.
SELF-HELP GROUPS

This is suitable for companies trying to tap the rural market. Selling through SHG may prove fruitful
as a distribution strategy as women in the sample area are having high percentage of population
and are willing undertake entrepreneurial activities. As a channel member they can serve as
opinion leaders to prospective customers as they are full of confidence and good
communication skills. Though less educated still capable of understanding this business concept
would help them convincing the rural population to buy products and services from them. Example:
HUL Project Shakti- Target to reach villages with population below 2000. A member from a SHG is
selected as a Shakti Entrepreneur referred to as SA to become DTH distributers of HUL products
in Rural Markets. On the job training and support were sourced to these SAs. SAs receive goods from
the HUL's rural distributor which is then sold directly to consumers and retailers in the village. Each
SA serves 6-10 villages. After the success of project Shakti in AP, HUL extended the project to
other states as well. Presently there are over 45000 SA's covering over 1 lakh villages across 15
states and reaching to over 3 million homes

Advantages: Affordability, building brand image