QuestionI'm trying to get started w hot shotting and have lots of questions. one of them is the rate of pay for hauling. i have no idea where to start on rates and would like some help.
AnswerChace...
Thanks for the question. Unfortunately there is no set or standard rate. The rates you set should be based on a comprehensive business plan. Capital investment in equipment, depreciation, maintenance, insurance costs, volume of business, geographical location, how many & where you haul, marketing and how efficiently the business is operated are all factors that will impact your operating costs and revenue. Those factors vary with each individual and each company so there is no definitive answer I can give you. The bottom line is to develop a business plan based on your best estimates; select an acceptable profit margin for your particular needs; and start from there.
Hopefully you're aware of all the requirements if you're transporting cars interstate. If you've obtained your US DOT and MC#, had the Process Server company file the BOC-3 form, and have your insurance including BIPD ($1,000,000.00) & cargo quoted and ready to purchase, you're well on your way. Your insurance company will also have to file the appropriate forms with FMCSA before your authority (MC#) is activated. If not, you're still a long distance from being able to transport cars interstate legally. All that and more are required to establish your motor carrier company. Keep in mind, you'll be wearing two hats as an owner-operator. First of all is the owner and manager of a motor carrier company and secondly as a truck driver. It takes skill and knowledge in both areas to be successful.
As the driver, (depending on the CGVWR of your truck & trailer) you'll need the appropriate license for the commercial vehicle you're operating; medical certificate; vehicle inspections that meet the US DOT requirements; knowledge of the HOS rules; and the correct maintenance of log books and records.
If your equipment combined GVWR is over the 26,000 lbs threshold, you'll need a CDL and to register for apportioned tags and file IRP/IFTA. You'll have to keep records of your fuel purchases; miles traveled in each state; and file quarterly fuel tax reports.
On the company side, you'll need to maintain all the mandatory records including a driver's qualification file, maintenance records, etc.....even for yourself as a driver. You'll be entered in to the "New Entrant" program and will likely have an audit or compliance review within the first few weeks after your authority is granted and activated. If you're operating CMVs that require a CDL, you'll have to comply with the mandated drug screening & testing by joining a consortium.
There is a lot involved to becoming legal and you didn't state your background or experience so I'm assuming you're just starting out. It isn't my intention to discourage you and hopefully you've already completed the necessary steps to become a legal motor carrier, or at least made some progress toward it. However, I just wanted to make you aware of some of the things you'll have to do to be legal if you're just starting in to the trucking business.
The consequences of operating without legal authority and insurance can be severe. It can include substantial fines; impoundment & confiscation of your truck and shipment; and potential incarceration.
Good luck and let me know if you have any additional questions and let me know if I can help you get established as a legal motor carrier.
...Don
SEMO Professional Consultants
