Why does Hot Shotting exist?

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Unfortunately it's those kind of companies that drive the rates down for everyone.

 

Full Trailer Load, or Full Truck Load.

 

Type of truck doesn't matter, but most of the hot-shotters are pickup/trailer combos. There are more than a few with larger trucks, or large straight trucks - and some vans like Sprinters as well.

Has more to do with the type of loads and the kind of service. As a hot-shot, I offer brokers (and shippers) fairly immediate availability, for instance. I get a call, I go hook up and run to pick up the load. Could be as little as an hour between the call and the pickup. If it all starts early in the day and it's a short trip, I can get a call, grab the load, drop it off and be home that evening. Worst case usually is that I pick up today and deliver first thing tomorrow. It's harder to do that with a 53' flatbed that's already in the middle of several pickups and drop-offs.

The trick (especially lately) is to get the shippers to pay what that service is worth, or to get the brokers to not keep the lion's share of the fees. All to many loads are showing up on the boards as full truckloads at 6000lbs (read to mean "I want a dedicated truck") posted at $1 per mile or less. Someone is taking those loads. Otherwise the rates would come back up.

 

This is where the REAL long-timers need to chime in, but I'll give you the perspective from my year-and-a-half plus the research I've done.

I personally have seen the rates drop significantly in the last six months or so. But note that they were starting to drop probably long before that.

One thing to consider is that the posted rates I see are on the load boards. Loads that are brokered directly from brokers to haulers that they know usually go out at a higher rate. The loads that make the boards are the ones that the brokers couldn't get placed (probably because the shipper was to dammed cheap) and as such show up with a lower rate.

In my opinion, most of the people who are falling by the wayside are doing so for a couple reasons:

1) They are not operating as a business. They look only at their revenue, and don't consider little things like overheads, down-the-road maintenance, taxes, etc. $6000 or $8000 a month income looks like a lot until you figure out that a third of that goes to the truck in fuel, insurance, maintenance and so on, a third goes to the government in one form or another and a third goes to the driver. These days, not too many of us can exist long term on $2000 to $2500 per month.

2) They are not focusing their business generation efforts on activities that are most profitable for them. I see people from way off on the edges of the country looking seriously at doing RV delivery. Most of the RV manufacturing is done in the middle of the country. Deadheading a bunch of miles to do a one-way delivery is a pretty quick way to insolvency. It should be obvious (but maybe it's not) that you make the most real profit by dragging stuff around on the truck, not driving the truck for hours or days empty to get to some work.

3) Nobody wants to sell. Face up to it. Money doesn't change hands until a sale is made. You have to, at some point, become the salesperson for your trucking company and convince someone - whether it be a broker or a shipper - that you are the best choice for them. And like all salespeople, you have to sometimes just spend the time beating the streets, calling on companies or brokers to improve your business.

If you are considering doing this for a living, you'd better spend some time building your business model. What are you going to carry? Where are you going to drive? What equipment do you need to do that? Where are you going to find the business? How are you going to get some of that business when you find it? What do you expect your costs of operation to be? How much money do you need to earn for yourself per month to live as you do? How much revenue do you need to earn to cover all costs and taxes and give you enough income? And there are a hundred more questions you need to ask and answer.

This is not an adventure, it's a business. And if you can't or don't want to operate it as one you may as well save yourself time and heartaches. I've heard it said that if you want to wind up with a million dollars in trucking, you start with two million dollars.........

 

Yes, you can grow this type of business if you have the skill drive, guts, and like minded people along side you to help you do it. Here's the thing, and with you being in charge of 15 employees, you should already know this, do the people in your circle have the same drive, Probably not. Most people get excited about stuff for a little bit and then they go negative and quit if/when they hit a rough patch.

I personally don't know anybody hauling loads for $1.00 a mile. I know plenty of people that'll haul a single partial for $1.00 per mile but they always have more than one partial on their trailer.

The loads we're moving average from $1.60 to $2,40 per mile. And we also move loads that pay $3.00 to $5.00 a mile occasionally.

I'm seeing more and more young guys approach this business making graphs and predictions and posting them on forums, and FB pages. Their graphs will be diving, and their predictions are gloomy and at the same time we're overwhelmed with good paying work.

Whether you own one truck, or a thousand your top priority should aways be to keep the truck, or trucks loaded and rolling at a profit. You can't allow anything, or anyone to break your focus. If you find that you have time to make those graphs and predictions, buddy your in trouble.

Instead of making graphs and predictions I use my free time to hunt for other freight. When I day dream, or when I'm drifting off to sleep at night, I'm thinking about things like , What other types of freight is out there that I could go after. What trailer mods could I make that'll help sustain, or increase revenue for the trucks I'm loading. What can I do to help increase sells for mfgr's producing the types of freight I want to haul more of?

And here's one that's always rolling through my mind, and it'll most likely get the wheels turning in you head to. If there's no freight ( return load) for us to haul in a certain area , is there something in that area that I could possibly buy and resell elsewhere for enough profit to produce a good freight rate for the truck? I call this buying a load. I've done it a few times over the years and I've seen it produce as much as $19.00 a mile profit (100 mile run, $1,900.00 profit) and it took the same amount of time as hauling for a shipper, or broker.

 

When I said $19.00 a mile profit, what I should've said is $19.00 a mile before op cost.