What is a Freight Forwarder?

For the sake of example, say you’re shipping important freight halfway across the country. You need it to arrive at its final destination precisely at a certain time in order to appease your own customers and guarantee future success for your business.

One of the people you would enlist during this time is called a freight forwarder. They’re the person (or organization) that takes possession of your important items. They store them, pack them, ship them, and help make sure that everything gets exactly where it needs to go on-time and in full.

The Main Responsibilities of Freight Forwarders

Because a freight forwarder is handling your important shipment, they take a very direct role in everything that happens. In most situations, they’ll be responsible for covering your shipment by way of insurance. If something goes wrong, it is their responsibility to make it right.

While a freight forwarder won’t necessarily transport your important goods or other items directly, they will find the company that can. It’s a highly specialized job that comes with its own requirements, like the fact that any freight forwarder needs to be licensed under the Federal Motor Carrier Safety Administration. Also commonly referred to as the FMCSA for short, this is for both interstate and foreign freight.

Always ask to make sure that a company is licensed before you choose any particular one to work with.

What are the Benefits of Using Freight Forwarders?

In a general sense, the biggest benefit that comes with using freight forwarders has to do with how you get to leverage someone else’s years of experience to your advantage.

You’re an expert at running a business – you’re not necessarily (nor are you expected to be) adept at the finer points of shipping and logistics. A freight forwarder, on the other hand, is. That’s why they can help break up or even consolidate goods in storage in a way that makes them easier to ship while saving you both time and money at the same time.

They can extend those cost-savings into packaging and routing freight in unique and forward-thinking ways. Your freight still gets exactly where it needs to go, but in a way that saves money so that you can funnel it back into other areas of your business where it can do the most good.

Freight forwarders are also a tremendously efficient way to save as much of your time as possible. They handle all matters pertaining to customs, for example. Export or import issues can take a significant amount of time to resolve but thanks to a freight forwarder, that’s not something you have to worry about.

Along the same lines, freight forwarders will also help make sure that all of your essential paperwork is in order. This includes but is certainly not limited to any commercial invoices that you’re working with, the bill of lading, and certificates of origin (for international matters). This again frees up as much of your valuable time as possible so that you can focus on anything that you deem more important.

What is a Freight Broker?

In the world of logistics, a freight broker is an experienced professional who coordinates the connection between A) shippers, and B) carriers. It’s important to note that they do not handle freight directly. They simply act as something of a “middleman” between two parties during this important process.

The Main Responsibilities of Freight Brokers

Because of the nature of their position, the number one responsibility of a freight broker is to help you secure the best rate possible. Freight brokers often have pre-existing relationships with multiple carriers that they can leverage. Rather than trying to negotiate something on your own, they can help match you up with the right shipper and negotiate the best possible contract to help save you money.

Again, freight brokers only act as a “middleman” between a shipper and a carrier. They’re not responsible for any part of the right handling process. They will, however, track shipments to help make sure that all key stakeholders are up-to-date should any conditions arise that need their attention.

What are the Benefits of Using Freight Brokers?

To that end, one of the key benefits of using a freight broker is the increased visibility into your shipment that they bring with them. A freight broker will help keep track of freight and fuel rates, will keep tabs on regulations that you need to know about, and can even help stay up-to-date on all emerging industry trends. This is all insight that they will then share with both the shipper and the carrier so that all parties can make the best decisions possible moving forward.

But overall, freight brokers also have a reputation for helping to save everyone involved as much money as possible. For carriers, they can help optimize routes in a way that eliminates inefficiencies and that helps increase important qualities like accuracy and even safety. For businesses, they can help negotiate the best rates to save as much money as possible on the actual shipment itself.

In a lot of ways, a freight broker is like an accountant. Not only are they supposed to save you money, but the amount they end up saving will more than cover the associated costs of choosing one in the first place.

Key Differences: Freight Forwarder vs Broker

The main difference between a freight forwarder vs broker is one of responsibility. The freight forwarder is always responsible to the shipper in any logistics situation. A carrier, on the other hand, is responsible to the forwarder. The carrier is not directly responsible to the shipper. That’s what a freight forwarder is for.

This mainly comes into play should any legal issues arise during the shipping process. Freight brokers do not take physical possession of the important goods and other products being shipped. Freight forwarders do.

How to Choose Which to Use

In most scenarios, if you can only pick between a freight forwarder and a broker, choosing a broker is the way to go. They play a critical role in domestic shipping in particular and can help save you time and money. Many organizations find a great deal of success using both at the same time, however. It will simply come down to which option makes the most sense given the goals that you’re trying to accomplish.

If you’d like to find out more information about the differences between a freight forwarder and a freight broker, or if you just have any additional questions you’d like to go over with someone in a bit more detail, please don’t delay – contact the team at Advanced Commercial Capital today.

What is the Purpose of Lumpers?

If you had to make a list of some of the positions that are crucial to the trucking industry, lumpers would undoubtedly be right at the top.

Essentially, a lumper is a person who unloads cargo when it arrives at a warehouse. A driver picks up a shipment from its point of origin and takes it to its destination. The business representing that destination has likely hired a team of third-party individuals to safely unload that truck. These would be lumpers.

A lumper is particularly valuable in situations where specialized skills are needed to ensure the safe handling of goods. This is why you’ll see a lot of grocery store chains hire lumpers, for example, as unloading perishable goods in a way that keeps everything safe until it reaches store shelves isn’t necessarily a task you can assign to just anyone.

A lumper is often trained to be able to accomplish their job not only quickly, but accurately and (most importantly) safely as well.

Depending on the exact company they’re working for, lumpers could be involved in a wide range of different types of freight. They can handle the aforementioned grocery store inventory items to household furniture and other large products, for example. They don’t just load and unload in a general sense. They stack, organize, and more. This is what separates them from any average employee who may be hired by a warehouse to perform similar duties. By profession, a lumper is dedicated to offering a level of care and attention-to-detail that it is difficult to match through other means.

What are Lumper Fees?

In the trucking industry, a lumper fee is a charge relating to freight deliveries that equates to the value of the labor that was necessary to both load and unload the cargo in question.

Sometimes, a company will need to hire a third-party worker to move a shipment from one place to the next. Naturally, that will mean loading and/or unloading a truck, which is physical work to be performed. A lumper fee helps to cover the costs associated with that action.

What Is a Typical Fee?

Lumper fees will vary depending on the job because there are so many different factors involved. In addition to base wages, a lumper fee is also meant to provide assistance with any tools, materials, or other supplies that may be required. Generally speaking, a lumper fee will range from $100 to $500 depending on these conditions.

What are Lumper Receipts?

As the term implies, a lumper fee receipt is simply proof that payment has been made. Sometimes this can come in the form of a paper receipt, or it may be in a digital format. Regardless, it will have the same basic information including the date and time that the work was performed, as well as an overview of the services.

Who Pays Lumpers?

Oftentimes, freight brokers will make it a requirement as part of their contract that drivers use lumper services. This is done to guarantee the safety of the shipment, as well as all involved. The broker will be responsible for paying the lumper fee. If they don’t do so directly and the driver does, the driver will eventually be reimbursed.

In certain situations, it’s possible to get a lumper fee advance – as is true when drivers partner with OTR solutions like the team at Advanced Commercial Capital. If a driver is being told that they must pay the lumper fee up front, they can get an advance from Advanced Commercial Capital to cover those costs. That way, they don’t have to worry about any financial strain or potential payment delays when the work has been completed.

Laws Surrounding Lumpers

The major law surrounding lumpers is Title 49 of the United States Code 14103. It expressly states that the shipper or receiver (depending on the agreement between these two parties) is responsible for all costs associated with paying a lumper and their fees.

Of course, not every driver is necessarily aware that the law is on their side – meaning that they could fall victim to scams if they’re not careful. If you’re a driver that is expressly told by your freight broker that you are responsible for the fee, or that you have to pay upfront and will not be reimbursed, this is likely a scam. It could be that the broker is attempting to essentially trick you into reimbursing them for a fee they’ve already paid, allowing them to look legally compliant on the surface while getting back the lumper fee in the end. The same would be true if they insist on taking money to cover some or all of the lumper fee out of your eventual payment.

Pro’s & Con’s of Hiring Lumpers

For most organizations, the major benefit of hiring lumpers comes by way of the money they save in the long run.

The alternative to lumpers would involve hiring your own permanent team of staff members to accomplish the same task. You might think this would be easy, but again – many types of freight require specialized skills to handle properly. Finding the sheer volume of these employees that you would need to avoid delays isn’t just expensive – it’s also incredibly time-consuming.

Not only that, but when you hire lumpers, you don’t need to concern yourself with things like payroll taxes or workers’ compensation insurance. This alone can make it a cost-effective way for mid-sized organizations in particular to get this important job done.

One of the potential cons of hiring lumpers ultimately has to do with a lot of the criticism they regularly receive from those in the industry. If the events of the last few years taught us anything, it’s that the supply chain is inherently fragile. On the one hand, things have grown to the point where it’s now possible for even small businesses to operate on a global scale. However, anything you add to the supply chain increases its complexity, which also represents another potential point of failure moving forward.

Because of this, lumpers are seen by some as an unneeded addition to a supply chain that has already grown far too large over time. Whether that will impact your own business remains to be seen, but it is something that people have discussed in the recent past.

If you’d like to find out more information about the intricacies of lumper fees in the world of trucking, 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.

What is a Freight Truck?

If you had to make a list of all the industries in this country that many people take for granted, transportation and logistics would undoubtedly be right at the top. Most of us don’t spend too much time thinking about the origins of that new furniture we bought, or that car, or all those items we ordered on Amazon. We just enjoy them. But without logistics professionals, they never would have made it into our lives.

In terms of the transportation industry itself, freight trucks are crucial. They’re designed to transport items safely and efficiently, no matter what. But obviously, different types of items have different requirements. You wouldn’t be able to haul gasoline to the local gas station for a refill using the same type of freight truck you would to get all those dairy items down to the local grocery store. You’d use freight trucks in both situations – just two different kinds.

When people talk about the sensitive nature of supply chain operations, not only in this country but around the world, understand that freight trucks of all shapes, sizes, and types are an integral part of that.

8 Types of Freight Trucks

All told freight trucks have a variety of intended purposes depending on what type you’re talking about. Some look very different from the next and many require specific types of experience to safely operate. They all have the same overall purpose, however: to make sure important items get where they need to be, no matter what.

1. Dry Van

A dry van is the type of freight truck that most people are familiar with. Indeed, if you’ve ever ridden on the highway for any appreciable length of time, you’ve likely passed more than a few of these. Dry vans have 53-foot-long trailers and are not temperature-controlled. If you’ve ever worked in a warehouse and had to unload pallets or even furniture, the chances are high that it all arrived at your destination via a dry van.

2. Refrigerated (Reefer)

Refrigerated trucks are sometimes called reefer trucks. They look similar to a traditional dry van, except the trailer itself is temperature-controlled. This makes it perfect for hauling items that need to stay within a precise temperature range, with food and beverages being the top example. Many pharmaceuticals and even sensitive chemicals are often hauled this way, too.

3. Flatbed

Flatbed trucks don’t carry their loads in an enclosed trailer. Instead, as the name implies, they use a flat, open trailer. There are no sides or even a roof. This is what makes them perfect for oversized cargo in particular. They’re easier to load than a traditional truck and can carry the type of weight that you’d be hard-pressed to match elsewhere.

4. Step Deck (Drop Deck)

Also commonly referred to as a drop deck, a step deck trailer is not too dissimilar to a flatbed truck. You still have a flat, open space with which to store items. However, the unique construction of a step deck makes it the ideal solution for tall cargo in particular. Not only do they have more overhead clearance, but they’re also easier to load and unload as well because they’re closer to the ground.

5. Tanker

Tanker trucks are designed very precisely to carry the types of loads that would largely be impossible to transport in any other way. A lot of construction materials make it to their destination this way – like sand or even concrete.

Here, there are two main types of tankers that you’re talking about. The first are dry bulk tankers, which can carry items like sugar and grain. Liquid tankers are also available, which are great for hauling beverages or even chemicals like gasoline. Most of these have different compartments to keep multiple loads separated from one another. They are both equally challenging to load and operate, albeit in their own unique ways.

6. Dump

Dump trailers, also commonly referred to as dump trucks, are designed to easily transport loose materials. One might be used to remove debris from a construction site, for example. Another might take essential materials like gravel to that same construction site. They’re also regularly used in the landscaping and agricultural sectors. The point is that whatever you’re hauling, you can do so quickly and efficiently. A dump truck is open on the top so whatever you’re hauling will be exposed to the elements to a certain extent, but that likely won’t matter.

7. Auto-Transporter (Car Hauler)

Auto-transporters are a type of freight truck designed for a single purpose: to safely carry multiple vehicles at one time. They’re built in a way that makes loading them easy – you essentially just drive the car right into an enclosed space, at which point it is secured. Depending on the size of the vehicles, it’s not unusual to see a car hauler with six or more cars at one time. These auto-transporters typically get used by car dealerships, for example, to transfer cars from one location to another. Regardless, if you need to transport vehicles over long distances, and you don’t want to actually drive them, an auto-transporter is likely how you’re going to get the job done.

8. Double Trailer

Finally, we arrive at double trailers. They’re essentially two dry trailers that are being pulled by a single truck. In terms of their design, think of them a bit like a train, only on the road. Multiple trailers are all being pulled via a locomotive, only in this case it’s a standard truck. You often see a lot of these carrying around large quantities of items in the retail or e-commerce industry. Some package delivery services also use them when they need to move high volumes of goods. Regardless, double trailers are understandably difficult to operate, which is why it takes an experienced driver to make sure things get where they’re going as safely and as efficiently as possible.

In the end, the type of freight truck you should use will vary depending on exactly what type of cargo you’re hauling. Typically, the job itself will dictate what type of truck is required. If something must be temperature controlled, you begin to narrow down your transportation options fairly quickly. If you’re having a hard time deciding, don’t worry – the team at Advanced Commercial Capital is happy to help.

If you’d like to find out more information about the different types of freight trucks, or if you’d just like to discuss your business’ own needs with someone in a bit more detail, please don’t hesitate to contact Advanced Commercial Capital today.

What is Over the Road (OTR) Trucking?

Also commonly referred to as OTR for short, over-the-road trucking is exactly what it sounds like. As a logistics professional, you’ll be tasked with hauling cargo over long distances, typically crossing state lines. You may even venture into other countries depending on the nature of the freight you’re carrying.

Over-the-road truck drivers can spend three to four weeks on the open road sometimes, seeing the best that Mother Nature has to offer while also making a satisfying living for themselves at the same time. They can sleep in either the cabin of their truck or at a nearby hotel or motel depending on their preferences.

Indeed, OTR truck driving professionals are the backbone of logistics in this country – they’re a significant contributor to the way our economy functions. But what is OTR in a general sense, and how does it differ from regional or even local truck driving? The answers to questions like those require you to keep a number of important things in mind.

How Much do Over the Road Truckers Make?

OTR (over the road) truckers typically earn between $45,000 to $70,000 per year, depending on factors such as experience, employer, and mileage driven. Some experienced truckers with specialized skills or hauling hazardous materials can earn upwards of $80,000 annually. Additionally, many OTR truckers receive benefits like health insurance, retirement plans, and performance bonuses, enhancing their overall compensation package.

OTR vs. Regional vs. Local Trucking

It’s entirely possible for over-the-road, regional, and local truck drivers to be carrying similar types of freight at a given time. It’s just that beyond this, the nature of their job (and the length of each commitment) can vary wildly.

Local trucking is exactly that – short-range trucking that likely involves hauling cargo from one part of a city to another. Most of these truck drivers work a typical 9-to-5 work day, or at the very least have something that resembles a traditional hourly job. A local truck driver might pick up a load of goods at a warehouse and take it to a specific business, for example. They’ll also likely drive smaller trucks simply due to the nature of their job.

Regional truck driving kicks things up a notch by breaking free of the confines of one particular area. Here, truck drivers will travel an entire region which can involve multiple states depending on the logistics network someone is a part of.

Most larger organizations that do a lot of shipping break the country up into a series of smaller states. Each of those collections of states is called a region and a regional truck driver could find themselves in various locations across the Northeast, Midwest, Southwest, or more depending on the day.

Regional truck driving is a bit more time-consuming and labor-intensive than local truck driving, but not nearly to the extent that OTR trucking is. Regional truck drivers could be engaged in one job for a few days at a time, but they’ll still get to spend more time with their friends and family members than their OTR counterparts. They regularly find themselves away from home, but never too far away from home.

As stated. OTR truck drivers can find themselves on-the-road for literally weeks at a time. It’s not inconceivable that they could have to haul a load from one corner of the country to another, or from Washington state across the border into Mexico. It all depends on who they’re working for and what the needs of the job are. Anywhere you can get to on the continent via truck is a place that an OTR truck driver could find themselves in at some point.

OTR Trucking Job Requirements

The number one OTR trucking job requirement to concern yourself with has to do with a CDL, or commercial driver’s license. Just like you need a driver’s license to operate your personal motor vehicle to show that you have the skills and judgment necessary to do so safely, the same is true of commercial trucks.

There are three main classes of CDL to choose from depending on your needs. These include:

It’s also important to note that the actual licensing process you’ll go through varies depending on which state you’re in. They all, at a minimum, will require you to take both a written test and a practical one. To that end, it will be not unlike when you got your regular driver’s license as a teenager, albeit on a much larger scale.

In an over-arching sense, you’ll always have to prove that you’re capable of safely operating the vehicle that you’ll be driving and that you’re capable of adhering to state and federal regulations. It’s just that some states are a bit more intense when it comes to proving exactly that.

Advantages of OTR Trucking

By far, one of the biggest advantages that comes with OTR trucking has to do with earnings potential. Yes, it’s a significant time commitment, and you’re almost guaranteed to spend a lot of time away from your friends and family members. But according to one recent study, the average starting salary for drivers is about $64,000 per year. Depending on the amount of experience you have, coupled with certain endorsements, you could easily make $120,000 or more.

All this and you also have more job security than most people get to enjoy. Right now, there is actually a truck driver shortage in this country – a problem that is only expected to get worse as time goes on. Over the next decade companies will be so desperate for truck drivers that you essentially never have to worry about being out of work for too long. You’ll also likely get perks like a fuel card while over the road trucking so you don’t have to worry about how you’re going to get from one location to another.

Many people also enjoy the fact that there are few requirements needed in order to begin a career (only the aforementioned licensing), and professionals often cite the decidedly unique lifestyle they get to live as a major selling point.

If you’re interested in finding out more information about over-the-road truck driving and why it might be an ideal career choice for you, or if you just have any additional questions that you’d like to discuss with someone in a bit more detail, please don’t delay – contact the team at Advanced Commercial Capital today.

Understanding LTL Freight

Less than truckload freight, also commonly referred to as LTL for short, is exactly what it sounds like — the process of transporting products and other goods that don’t necessitate a full tractor-trailer or other large commercial truck to do so.

Because of this configuration, one business may share space with others during transportation. They will pay only for the space their pallets are using, at which point the remainder of the truck will be filled up with assets relating to other businesses. Usually, these LTL freight shipments can range from between 150 pounds to 10,000 pounds, although there may be some exceptions.

Weighing the Pros and Cons of LTL Freight

As is true with any type of shipping, LTL freight has both its advantages and disadvantages. Only by understanding the intricacies of each will you be able to determine which approach is most appropriate for your needs.

Advantages

The most immediate benefit of LTL freight has to do with cost savings. It’s simply far cheaper to pay for a portion of the space on a truck than it is for the entirety of the vehicle. Depending on what you’re shipping, LTL could wind up being exponentially less than what you would otherwise pay.

Because of this, LTL freight is notorious for being small business-friendly in particular. Smaller organizations don’t necessarily have the available funds necessary for full truckload freight. If what they’re shipping doesn’t take up enough physical space to actually require that full truckload, they’re also paying for resources that they’re not utilizing. So not only does LTL freight become the more cost-effective option, but the most efficient one as well.

LTL freight by design is also very environmentally friendly. Due to things like fuel costs, it’s unrealistic to ship a truck with anything less than maximum capacity — especially if it’s going to be traveling large distances. Rather than having five businesses pay for five separate trucks that they won’t be utilizing 100% of, all that can be condensed into a single shipment — creating a beneficial situation for all parties.

Disadvantages

Of course, that’s not to say that LTL freight isn’t without its potential obstacles — chief among them being the added time that it adds to the shipping process.

If a business was paying for a full truckload, that driver would answer exclusively to them. It would pick up those products and head right to their final destination as quickly as possible. With LTL freight, you are sharing space with other businesses that will also need to be attended to. This could cause an appreciable delay in the amount of time it takes for a shipment to reach its destination.

LTL shipping is also inherently complicated due to the ever-fluctuating rates that organizations are charged. It isn’t just your shipment’s destination that carriers are concerned about. They also want to know the total weight, the pickup location, the deadline, and other factors. Everything impacts how much you will pay, which can make it a time-consuming process in and of itself to determine how much you’ll spend and where to go to find the perfect balance between price and the level of service you get in return.

Navigating LTL Freight Rates

As stated, a number of different factors determine the LTL shipping rate that you’ll pay. The dimensions of your shipment determine the class itself, which impacts — but does not totally dictate — the rate. The destination of the shipment will also play a role. The farther it has to go, the more money you can expect to spend.

Some shipments require special handling, which will also add to the cost. Examples include but are not limited to perishable items, fragile items, and anything that is particularly hazardous. Finally, if you choose to expedite your shipment, you can expect to pay an additional fee.

Optimizing LTL Freight Management

One of the best ways to optimize your LTL freight management efforts involves the use of a transportation management system, otherwise known as a TMS for short. This is a software-based tool that not only provides shipping optimization on a case-by-case basis, but also global visibility and business intelligence into everything that you have in transit.

Once all information is entered accurately, a TMS will be able to consider every LTL load you have in the context of your entire business. It can then help you identify opportunities to combine with other loads on nearby routes. It can also help you select an LTL carrier, better anticipate your rates, and more — all so that you can have the most complete and accurate picture to work from when making decisions.

Choosing Between LTL and Parcel Shipping

Generally speaking, LTL shipping is ideal for organizations that A) do not require a full trailer to transport their items, and B) are dealing with a shipment that is under 15,000 pounds. Any more than that and you would obviously want a full trailer. Any less than that and LTL still might be a bit too much effort given what you’re trying to accomplish.

Depending on current freight rates, parcel shipping might be the way to go. This is especially true if the items you’re shipping are under 150 pounds individually. In that case, you’d probably be able to find more competitive rates with a parcel service.

Addressing Common Issues in LTL Shipping

One of the most common issues that businesses often face with LTL shipping has to do with misunderstood shipping windows. When your average person buys a product online that is shipped to their home, they’re very used to “three-day shipping” translating to “three days or less.” When you’re talking about large, complex situations involving LTL freight, a quote of “three days” likely means a “minimum of three days.” Because of that, you need to calibrate your own expectations accordingly and make appropriate arrangements with your customers or those waiting for your shipments.

Another common issue that many have with LTL shipping has to do with rates that seem to fluctuate far more than they really are. If you’re getting a quote based on inaccurate information, that quote will be adjusted appropriately once the carrier actually has possession of your shipment.

For the best results, always weigh and measure as accurately as possible. If a product weighs 10 pounds, but it’s in a box with a lot of empty space, that’s a lot of wasted room that will only add to your costs. Try to package things as carefully as you can to avoid running into these types of problems moving forward.

To find out more information about the ins and outs of LTL freight, or to get answers to any other questions about the process that you may have, please don’t delay — contact Advanced Commercial Capital today.

Trucking remains a vital industry in the modern world. Trucking companies transport over 72% of all goods across the United States, and that number is expected to increase in the coming decade. When done well, a trucking company can be a lucrative business venture that’s in high demand. In general, you should plan to invest $100,000 to $200,000 at a minimum to start a trucking company, and those costs can increase based on the size of your operation, the number of employees you intend to hire, and the number of trucks you wish to own. Rather than asking, “How much does it cost to start a trucking company?” and looking for a flat figure, a better strategy to understand these costs is to look at the various costs you will need to cover to launch and run a freight or tucking occupancy. At Advanced Commercial Capital, we work with trucking and freight companies of all sizes, and we understand the industry well. Here is a breakdown of the different costs of a trucking company that you would need to factor into your plans.

Starting Your Company – Initial Investment Breakdown

Starting your own trucking company comes with a variety of costs. Whether you start with one truck or 10, there are specific costs that you have to tackle to launch your business. Here is a general breakdown of the things you will need and their initial investments:

• CDL – Your commercial driver’s license is a necessity, and these costs vary from state to state, as does the cost of taking the CDL training course. Plan several thousand dollars for this expense.

• Truck and Trailer – To start your own trucking company, you must purchase a truck and trailer. The age, size, and type will all impact the cost. This cost can be as low as $15,000 and as high as $150,000 for just the truck and an additional $30,000 to $50,000 for the trailer.

• Insurance – Commercial trucking insurance can be as much as $12,000 to $18,000 a year per truck.

• USDOT and Motor Carrier Numbers – To operate legally, you must have an MC and USDOT number. The total cost is $300 per operating authority

• Business Entity – For your protection, you will want to set up an official business entity, such as a Limited Liability Company or S-Corp. The cost for this varies by state but is usually less than $2,000 for a simple business structure.

• Electronic Logging Device – Finally, you’ll need to invest in an ELD system to ensure your drivers remain compliant with hours on duty regulations. There are only a handful of exceptions to ELD regulations, so plan to invest in one of these systems at the launch of your business. These can cost as much as $950 per year to operate.

Before you can launch your business, you will need to have all of these costs covered, and our financing options can help.

Operation and Overhead Costs

Once the business is up and running, there are additional operation and overhead costs you’ll need to account for as you work to bring in income. Advanced Commercial Capital can help you account for the following:

1. Driver Salaries

Unless you are going to be an owner/operator, you will need to hire drivers to drive your trucks. Expect to pay a salary and mileage of around $70,000 a year to attract and retain reliable drivers. You may also choose to pay mileage in addition to a base salary, and a standard of 40 cents per mile is common.

2. Fuel and Tolls

Fuel is another cost you must account for once you’re up and running. You should expect about 6 miles for every gallon of fuel in your semi-truck, and the actual cost of fuel will depend on the current prices at the pump. Similarly, you will need to invest in EZ Pass to cover tolls for your drivers.

3. Technology

Many trucking companies find technology is essential to their operations. Advanced mathematics systems can help you keep your trucks on the road more accurately, and automated routing and dispatch systems will help improve the efficiency of your business. All of these systems cost something to operate.

4. Business Overhead Costs

Finally, a trucking company is, at its heart, a business. This means you will have costs for marketing, keeping up an office, invoicing your clients, creating rate confirmation and freight contract documents, organizing notice of assignment documents, and tracking payments, similar to any business. It can cost around $5,000 to start and run your initial marketing campaigns, and you will also need to account for other office-based expenses. In trucking, these operational costs include dispatch, which many new companies outsource, so plan on dispatch fees of around 5 to 10% per load.

Navigating Regulatory and Compliance Fees

The trucking industry is quite heavily regulated due to the serious nature of accidents involving semi-trucks. Here are some of the compliance and regulatory costs you’ll have to cover:

• BOC-3 Form – If you’re doing interstate business, you will need to have a BOC-3 Form, which shows you can operate legally in your various states. This costs between $20 and $40.

• International Registration Plan Credentials – The International Registration Plan Credential is also required if you cross state lines. The IRP averages about $1,700 a year, but these plates can cost between $500 and $3,000 per truck.

• International Fuel Tax Agreement Decal – Yet another regulation required for crossing state lines, the IFTA costs about $10 a year.

• Heavy Highway Vehicle Use Tax – The HVUT is applied to all trucks weighing over 55,000 pounds. It runs between $100 and $550 a year. You will also need to pay business income taxes each year.

• Unified Carrier Registration – The UCR for up to two trucks is $69, but for three to five vehicles, it is $206. Larger trucking companies will need to spend even more.

Choosing the Right Financing Strategy for Your Trucking Company

The costs to start a trucking company do vary from one to the next. The right financing strategy starts with the right finance company that understands the intricacies of running a trucking company. Advanced Commercial Capital works with trucking and freight companies, offering factoring, freight capital, and cash flow solutions tailored to the trucking industry. We help our clients finance their startup costs, avoid financial pitfalls, such as scams and double brokering, and create a financial plan that will work for the long term. Transportation financing is all we do, so we are well-positioned to help you launch your trucking company and keep it running through factoring or lines of credit that will keep the cash flow in play as you need it. To learn more about the costs of starting a trucking company, reach out to our team today.