What is hot shot trucking? On the surface, it may seem like a fairly straightforward situation involving what is essentially expedited shipping. In reality, it’s slightly more complicated than you think and if you’re considering taking your career in this direction, there are a few basic things you’ll want to keep in mind.

How Does Hot Shot Trucking Work?

Hot shot trucking is a term used to describe the transportation of smaller loads, typically under 10,000 pounds in weight. These are usually loads that are time-sensitive, meaning that fast delivery is of paramount importance to clients.

What are Hot Shot Loads?

From a technical perspective, there is a lot of overlap between hot shot loads and less-than-truckload loads, otherwise called LTL loads for short. These get sent directly to their destination, rather than going through some type of centralized hub or terminal as would otherwise be common. These, too, are usually delivered with fast turnaround times and are inherently flexible – thus underlining the appeal to many companies.

Small machinery, parts, and other types of construction equipment would be a good example of a hot shot load. The same would be true of certain types of agricultural supplies, manufacturing components, and even oilfield equipment. If something breaks down in a manufacturing environment, those replacement parts need to get delivered quickly because literally every minute that machine isn’t working is a minute the business is losing money. But at the same time, they can’t wait for a traditional load – which is where hot shot loads come in handy.

The Hot Shot Load Payment Structure

The actual hotshot load payment structure will vary depending on the exact organization you’re talking about.

Because of the time-sensitive nature of what is taking place, sometimes they’re paid by the load. The rate will likely depend on the final weight and size of the load, as well as how complicated the delivery job is.

Some organizations that specialize in hot shot loads charge a flat rate that is calculated based on average distance and timing. Some charge per mile, and some charge depending on how long it will take that load to be delivered.

Again – it really varies depending on the provider you’re talking about, which is why you want to make sure you have all the facts in order before choosing a logistics partner to go with.

Hot Shot Trucking vs Expedited Shipping

At this point, you may be wondering how hotshot trucking is anything different from the expedited shipping procedures that many of us are used to. Keep in mind that hot-shot trucking is typically focused on smaller shipments that are urgent in nature. Expedited shipping, on the other hand, just guarantees that delivery will be “faster than normal.” This can still involve air transport or larger freight items, so long as the load gets to where it needs to be at the moment it was promised.

Best Hot Shot Trucks & Trailers

Hot shot trucking depends on vehicles that can deliver smaller loads quickly – meaning that there are a few different types of trucks and trailers that are ideal for such a demand.

Class 3

These trucks typically range from 10,000 to 14,000 pounds of gross vehicle weight.

Class 4

Class 4 kicks things up a notch, extending the aforementioned range from 14,000 to 16,000 pounds.

Class 5

Class 5 trucks would have a gross vehicle weight of between 16,000 and 19,500 pounds. They can handle larger loads but still fall firmly under the purview of hotshot trucking.

Gooseneck Trailers

Gooseneck trailers are often a popular choice because they have stability when hauling heavier loads, but better weight distribution in most circumstances.

Lowboy Trailers

Lowboy trailers, as the term implies, have a lower deck for safer transportation. Within the context of hot shot trucking, they’re typically used to carry loads that are larger or even taller but that still need to be delivered urgently and flexibly.

Bumper Pull Trailers

These are arguably the most standard type of trailer out there. They connect directly to a truck using a hitch on the rear bumper.

Tilt Deck Trailers

Tilt deck trailers are those that have been specially designed to tilt to a low angle. This makes loading and unloading much easier, making the entire trailer better for certain types of equipment. Remember that when things need to be delivered as quickly as possible, getting those items on and off the truck must happen fast, too.

Pros & Cons of Hot Shot Trucking

As is true with all types of trucking, hot shot trucking is not for every situation. Only by carefully considering both the advantages and the potential disadvantages will you be able to decide if it is a direction you want to go in.

Pros

By design, the biggest benefit that hot shot trucking brings with it is one of flexibility and independence. If you’re a hot shot trucker, you set your own schedule and often have more than enough work to fill your day. It’s a fast-paced field (again, by its nature) and is always in high demand.

You get to work with a wide variety of loads, which also leads to a potentially higher profit potential – especially when you’re just starting your career. Because of the time-sensitive nature of these shipments, you typically get to charge a rush fee. This can vary depending on the route and the type of equipment you’re hauling.

Cons

The biggest potential disadvantage of hot shot trucking, especially for those newer to the profession, has to do with the high operating costs that come with it. You have to consider fuel, vehicle maintenance, and insurance – all of which can add up quickly, even though you’re operating a smaller truck.

To make any type of real money in hotshot trucking, you also have to work long hours. This can include nights and weekends because you never know A) when an urgent shipment is going to occur, and B) how long you’ll have to wait for the next one if you turn the current one down.

Hot shot trucking is also known for being a field with heavy competition, largely due to the low barrier of entry. These are all things that should be considered moving forward.

We Simplify Freight Billing

At Advanced Commercial Capital, we understand hot-shot trucking and want nothing more than to help you succeed. We simplify freight billing so that you can worry less about the billing process itself and focus more on having the best experience possible. If you’d like to find out more information about hot shot trucking, or if you have any additional questions you’d like to go over with someone in a bit more detail, please don’t hesitate to contact the Advanced Commercial Capital team today.

What is a Carrier Packet?

At its core, a carrier packet is a collection of documents that any freight broker requires from a carrier BEFORE they can begin transporting freight. Essentially, it helps make sure that every variable is accounted for. Freight can’t begin its journey if there are still lingering questions about compliance or regulatory standards, for example. Therefore, a carrier packet confirms elements like these, along with the finer details of the entire business relationship, so everyone is on the same page before work begins in earnest.

What is Included in a Carrier Packet?

While the actual specifics of a carrier packet will vary depending on the entities that you’re talking about, a proper carrier packet will have several critical documents. These include but are certainly not limited to ones like the following:

New Carrier Information

This includes what is essentially an overview of the carrier in question, including elements like their name, address, contact information, and MC (motor carrier) number.

Broker-Carrier Agreement

This is a legally binding document that goes into more detail about the terms and conditions of the relationship between the broker and the carrier. This helps all parties understand things like liability, responsibilities, and other pressing matters.

Notice of Assignment

A notice of assignment is one that makes it clear to all parties that the broker has the authority to assign the freight in question to the carrier. Essentially, it’s a way to prevent any arguments that may occur over who is responsible for what.

W-9 Form

This is a document used for income tax-related purposes. It will have the carrier’s Taxpayer Identification Number, otherwise known as their TIN for short. It is mandatory for complying with IRS regulations.

Safety Rating

As a part of any proper carrier packet, the carrier will need to provide their safety rating. This is something that is assigned by the Federal Motor Carrier Safety Administration, otherwise known as the FMCSA for short. It’s a rating that reflects their overall safety performance and history as an organization, which can be the actionable information that brokers need to properly assess risk on their own terms.

Driver’s License

Whenever you’re talking about a situation like freight transportation, you obviously need to make sure that everyone involved is legally allowed to be on the road in the first place. This is why it’s important that any carrier packet also has a copy of the driver’s license for any and all drivers who will be operating the vehicles. If the vehicle transporting the freight requires any special skills or licenses to safely operate, this is also information that will be noted in this section.

Broker Bond

A broker bond is a critical document that shows the carrier has the financial backing needed to fulfill their obligations, essentially. It helps protect the broker from any potential losses that would happen if the carrier fails to complete a load or ends up defaulting on a payment.

If a carrier is chosen to transport a load and only later do you find out they were insolvent and didn’t have the resources to do so, that’s more than just a minor inconvenience. In this scenario, the broker would incur significant financial losses and reputational damage as well. A broker bond is one of the things that helps prevent that type of situation from happening.

Invoicing Procedures

In freight transportation, everyone needs to get paid, and it is in the best interests of all parties to make sure that happens as quickly and as smoothly as possible. Invoicing procedures are guidelines designed to guarantee precisely that, including information about how invoices should be submitted, what payment timelines exist, and any specific documents that will be required alongside the invoice to help things go as quickly as possible.

Certificate of Insurance (COI)

Also known as a COI for short, a Certificate of Insurance is exactly what it sounds like – proof that the carrier has all necessary insurance coverage for the task at hand. This goes a long way towards protecting both the broker and the shipper from anything that could happen during transportation, be it due to negligence or something totally unforeseen and beyond anyone’s control.

Certificate of Authority (COA)

Also commonly referred to as a COA for short, a Certificate of Authority is a document that shows a carrier is legally allowed to operate as a freight carrier. Again, this is a big part of how proof of compliance with federal and state regulations is established.

Why are Carrier Packets Important in Trucking?

Freight transportation in general involves an incredible amount of risk for all parties. Carrier packets are one of the biggest ways to help mitigate that risk as much as possible, especially in terms of compliance with various regulations. Well-designed carrier packets also help to establish trust, streamline operations, and more – creating a mutually beneficial situation for all parties.

How To Create a Carrier Packet & Standout from the Crowd

When putting together a carrier packet to stand out from a crowd, the number one thing you can do is be comprehensive and organized. Make sure that all necessary documents are included and that nothing is overlooked. Make sure everything is accurate, and your finished product should be as professional as possible. You should also be ready to provide any additional information as requested.

How Often Should You Update Your Carrier Packet?

Generally speaking, your carrier packet should be updated whenever there are any significant changes in not only regulations and compliance but also your business practices as well. If you no longer accept certain types of roles or are unwilling to fulfill certain duties in the relationship, that needs to be reflected.

It seems like a bit of a cop-out to say “Your carrier packet should be updated whenever updates are necessary,” but that’s largely a rule of thumb to live by. If your company name changes, you need to update your carrier packet. When you get new drivers, you need to update your carrier packet. If compliance changes, and you’ve had to make significant adjustments to show that you’re not in violation, you need to update your carrier packet.

Your carrier packet should always be updated and current to make sure that everyone has the most complete set of documents to work from moving forward.

If you’d like to find out more information about the important role that carrier packets play in the world of freight transportation, or if you have any additional questions that you’d like to go over with someone in a bit more detail, please don’t hesitate to contact the team at Advanced Commercial Capital today.