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How to Start a Hot Shot Trucking Business

Written by:

Esther is a business strategist with over 20 years of experience as an entrepreneur, executive, educator, and management advisor.

Edited by:

David has been writing and learning about business, finance and globalization for a quarter-century, starting with a small New York consulting firm in the 1990s.

How to Start a Hot Shot Trucking Business

Fast Facts

Investment range

$28,000 - $75,000

Revenue potential

$90,000 - $180,000 p.a.

Time to build

0 - 3 months

Profit potential

$55,000 -$110,000 p.a.

Industry trend

Growing

Commitment

Flexible

Hot shot trucking is growing fast because it addresses a market gap, helping out shippers who want to move small freight loads quickly and would rather not pay for a large truck. The freight is carried in a standard pick-up truck or trailer attached to the truck.

Hot shot businesses specialize in shipping small, time-sensitive loads such as farm goods and building materials, commercial equipment, and so on. When done right, it can be a highly lucrative business with good profit margins. And like all shipping services, the work is varied, taking you to new places and interacting with new people every day.

In addition to hard work, getting started will also require a good deal of planning and preparation. Lucky for you, this step-by-step guide lays out all you need to know to put yourself on the road to being a hot shot entrepreneur.

Step 1: Decide if the Business Is Right for You

Pros and cons

While a hot shot business can be a great earner, it’s not for everyone. We’ve put a list of pros and cons together to help you decide whether it’s right for you.

Pros

  • Low startup costs, besides truck
  • Profitable, flexible side hustle
  • Simple and easy to manage

Cons

  • Work can be inconsistent and unpredictable
  • High insurance premiums may reduce profit margin

Hot shot trucking industry trends

Hot shot trucking is a small segment of the $732 billion US trucking and transport industry, but it’s also the fastest growing segment. It involves hauling LTL (less than truckload) shipments.

Industry size and growth

hot shot trucking industry size and growth

Trends and challenges

hot shot trucking industry Trends and Challenges

Hot shot trucking trends are:

  • Rising demand for cost-effective, fast, and reliable freight transport solutions is driving demand for hot shot trucking services
  • Strong rebound in manufacturing presents opportunities for hot shot trucking

Challenges in the hot shot trucking industry include:

  • High fuel prices and soaring inflation
  • Lack of qualified drivers

What kind of people work in hot shot trucking?

hot shot trucking industry demographics

How much does it cost to start a hot shot business?

The start-up costs for a hot shot business range from $28,000 to $75,000, with an average of $51,500. The bulk of this cost is of course for the pick-up truck and trailer, so if you already own these items, your costs will be reduced by up to 80%. 

While the costs may seem high, the overall risk of investing in a hot shot business is low, as more than 80% of the investment is for purchasing assets with great resalable value. So if the business fails to meet your expectations, you can sell the truck and trailer to recoup most of your investment.

Startup CostsBallpark RangeAverage
LLC incorporation, licenses and permits$500 - $1,000$750
Insurance $3,500 - $4,000$3,750
Marketing and advertising$500 - $2,000$1,250
Website $100 - $750$425
Software$200 - $250$225
Pick-up truck$15,000 - $45,000$30,000
Trailer$7,000 - $20,000$13,500
Other tools and equipment$200 - $1,000$600
Miscellaneous$1,000 - $1,000$1,000
Total$28,000 - $75,000$51,500

How much can you earn from a hot shot business?

hot shot trucking business earnings forecast

The average revenue for a hot shot service is $2 per mile,((https://www.dat.com/resources/hot-shot-trucking-startup-guide)) whereas the average cost is $0.78 per mile, resulting in a gross profit of $1.22 per mile. Each driver is allowed to work for 11 hours, followed by 10 hours of uninterrupted break.((https://www.fmcsa.dot.gov/regulations/hours-service/summary-hours-service-regulations))

If you drive for a quarter of the available driving time, you can expect to do 124 miles a day. This would generate about $90,000 in annual revenue and a profit of $55,000. Once you establish a reputation, you could be making shipments for half the possible time and drive nearly 250 miles a day. This will generate more than $180,000 in annual revenue and $110,000 in profit. 

What barriers to entry are there?

Overall the industry has low barriers to entry, and there are no strict regulations and compliance requirements.

A hot shot driver is required to hold a basic Class D License if they haul less than 10,000 pounds of cargo loads. To carry a bigger load, the driver is required to hold a Class A Commercial Driving License, which may serve as a barrier to entry.

The other major barrier to entry comes from a growing number of hot shot businesses, all of which offer essentially the same service. This may make it difficult to stand out from your competitors and draw business.

Related Business Ideas

If you’re still not sure whether this business idea is the right choice for you, here are some related business opportunities to help you on your path to entrepreneurial success.
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Step 2: Hone Your Idea

develop a business idea

Now that you know what’s involved in starting a hot shot trucking business, it’s a good idea to hone your concept in preparation to enter a competitive market. 

Market research will give you the upper hand, even if you’re already positive that you have a perfect product or service. Conducting market research is important, because it can help you understand your customers better, who your competitors are, and your business landscape.

Why? Identify an opportunity

As a delivery business, your work will be tied to a particular geographical area, so do your research to find out where the best opportunities are in your location.

Start by looking into who your competitors are locally, how many there are, what services they offer, and at what price. You’re looking for a market gap to fill. For instance, maybe the local market is missing a hot shot trucking firm that is eco-friendly or offers long distance transport. 

You might consider targeting a niche market by specializing in a certain aspect of your industry, such as partnering with developers and construction firms to haul away loads of junk and material from building sites.

This could jumpstart your word-of-mouth marketing and attract clients right away. 

Keep in mind, a hot shot business can be a profitable side hustle for people who already own a pick-up truck and trailer. If you already run a business, consider how you might incorporate hot shot services to make it even more profitable.

What? Determine your services

Hot shot drivers deliver small cargo loads quickly and efficiently. The main advantage to the customer is cost as big trucks are expensive. With lower overheads, hot shot carriers charge less for their services. You’ll need to decide the size of your driving range and your various cargo possibilities, and you might also perform deliveries for Amazon, when hot shot work is slow. 

How much should you charge for the service?

The average price for a 9,000-lb cargo load is $2 per mile, while your overhead should cost about $0.78 per mile on average. 

Once you know your costs, you can use this Step By Step profit margin calculator to determine your mark-up and final price points. Remember, the prices you use at launch should be subject to change if warranted by the market.

Who? Identify your target market

The vast majority of your clients will be B2B – other businesses that require your services to keep their own business running. You can search for local shipping firms, construction contractors, farmers, medical suppliers, auto parts companies, and even retailers and developers on LinkedIn as well as on Google Maps and even Yelp. 

You will mainly get hot shot jobs through load boards. A load board is an online platform where truck owners-operators meet with shippers and freight brokers that need to move freight. The major load boards are DAT, KeepTruckIn, 123LoadBoard, Convoy, and TruckStop.

Most load boards have a subscription-based business model, allowing premium users to login and post their loads or empty trucks. Load boards will also enable you to set up alerts for specific routes so that you shall be notified as a load matching with your route specification is posted.

Where? Choose your business premises

At least initially you will work at home and in your vehicle, but if you do well and expand, at some point you may need to rent out an office space. You can find commercial space to rent in your area on sites such as Craigslist, Crexi, and Instant Offices.

When choosing a commercial space, you may want to follow these rules of thumb:

  • Central location accessible via public transport
  • Ventilated and spacious, with good natural light
  • Flexible lease that can be extended as your business grows
  • Ready-to-use space with no major renovations or repairs needed
hot shot trucking business idea rating

Step 3: Brainstorm a Business Name

Here are some ideas for brainstorming your business name:

  • Short, unique, and catchy names tend to stand out
  • Names that are easy to say and spell tend to do better 
  • Name should be relevant to your product or service offerings
  • Ask around — family, friends, colleagues, social media — for suggestions
  • Including keywords, such as “shipping” or “hot shot trucking”, boosts SEO
  • Name should allow for expansion, for ex: “Fast Lane Trucking” over “Medical Supply Movers”
  • A location-based name can help establish a strong connection with your local community and help with the SEO but might hinder future expansion

Once you’ve got a list of potential names, visit the website of the US Patent and Trademark Office to make sure they are available for registration and check the availability of related domain names using our Domain Name Search tool. Using “.com” or “.org” sharply increases credibility, so it’s best to focus on these. 

Finally, make your choice among the names that pass this screening and go ahead with domain registration and social media account creation. Your business name is one of the key differentiators that set your business apart. Once you pick your company name, and start with the branding, it is hard to change the business name. Therefore, it’s important to carefully consider your choice before you start a business entity.

Step 4: Create a Business Plan

Here are the key components of a business plan:

what to include in a business plan
  • Executive Summary: A concise summary outlining the hot shot trucking business, including its mission, objectives, and key highlights.
  • Business Overview: A detailed description of the hot shot trucking business, covering its industry, target market, and unique value proposition.
  • Product and Services: Clearly define the specific transportation services offered by the hot shot trucking business, emphasizing any unique features or advantages.
  • Market Analysis: Thoroughly analyze the target market for the hot shot trucking business, identifying trends, customer needs, and potential growth opportunities.
  • Competitive Analysis: Assess the competitive landscape in the hot shot trucking industry, highlighting key competitors, their strengths and weaknesses, and strategies for differentiation.
  • Sales and Marketing: Outline the sales and marketing strategies for the hot shot trucking business, including customer acquisition plans, pricing strategies, and promotional activities.
  • Management Team: Introduce the key members of the management team for the hot shot trucking business, highlighting their relevant skills and experience.
  • Operations Plan: Detail the day-to-day operations of the hot shot trucking business, including logistics, fleet management, and any technology systems used for efficiency.
  • Financial Plan: Present a comprehensive financial plan for the hot shot trucking business, covering startup costs, revenue projections, and financial forecasts.
  • Appendix: Include any additional supporting documents or information, such as market research data, permits, licenses, or other relevant details that enhance the hot shot trucking business plan.

If you’ve never created a business plan, it can be an intimidating task. You might consider hiring a business plan specialist to create a top-notch business plan for you.

Step 5: Register Your Business

Registering your business is an absolutely crucial step — it’s the prerequisite to paying taxes, raising capital, opening a bank account, and other guideposts on the road to getting a business up and running.

Plus, registration is exciting because it makes the entire process official. Once it’s complete, you’ll have your own business! 

Choose where to register your company

Your business location is important because it can affect taxes, legal requirements, and revenue. Most people will register their business in the state where they live, but if you are planning to expand, you might consider looking elsewhere, as some states could offer real advantages when it comes to hot shot businesses. 

If you’re willing to move, you could really maximize your business! Keep in mind, it’s relatively easy to transfer your business to another state. 

Choose your business structure

Business entities come in several varieties, each with its pros and cons. The legal structure you choose for your hot shot business will shape your taxes, personal liability, and business registration requirements, so choose wisely. 

Here are the main options:

types of business structures
  • Sole Proprietorship – The most common structure for small businesses makes no legal distinction between company and owner. All income goes to the owner, who’s also liable for any debts, losses, or liabilities incurred by the business. The owner pays taxes on business income on his or her personal tax return.
  • General Partnership – Similar to a sole proprietorship, but for two or more people. Again, owners keep the profits and are liable for losses. The partners pay taxes on their share of business income on their personal tax returns.
  • Limited Liability Company (LLC) – Combines the characteristics of corporations with those of sole proprietorships or partnerships. Again, the owners are not personally liable for debts.
  • C Corp – Under this structure, the business is a distinct legal entity and the owner or owners are not personally liable for its debts. Owners take profits through shareholder dividends, rather than directly. The corporation pays taxes, and owners pay taxes on their dividends, which is sometimes referred to as double taxation.
  • S Corp – An S-Corporation refers to the tax classification of the business but is not a business entity. An S-Corp can be either a corporation or an LLC, which just need to elect to be an S-Corp for tax status. In an S-Corp, income is passed through directly to shareholders, who pay taxes on their share of business income on their personal tax returns.

We recommend that new business owners choose LLC as it offers liability protection and pass-through taxation while being simpler to form than a corporation. You can form an LLC in as little as five minutes using an online LLC formation service. They will check that your business name is available before filing, submit your articles of organization, and answer any questions you might have.

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Step 6: Register for Taxes

The final step before you’re able to pay taxes is getting an Employer Identification Number, or EIN. You can file for your EIN online or by mail or fax: visit the IRS website to learn more. Keep in mind, if you’ve chosen to be a sole proprietorship you can simply use your social security number as your EIN. 

Once you have your EIN, you’ll need to choose your tax year. Financially speaking, your business will operate in a calendar year (January–December) or a fiscal year, a 12-month period that can start in any month. This will determine your tax cycle, while your business structure will determine which taxes you’ll pay.

The IRS website also offers a tax-payers checklist, and taxes can be filed online.

It is important to consult an accountant or other professional to help you with your taxes to ensure you are completing them correctly.

Step 7: Fund Your Business

Securing financing is your next step and there are plenty of ways to raise capital:

  • Bank loans: This is the most common method but getting approved requires a rock-solid business plan and strong credit history.
  • SBA-guaranteed loans: The Small Business Administration can act as guarantor, helping gain that elusive bank approval via an SBA-guaranteed loan.
  • Government grants: A handful of financial assistance programs help fund entrepreneurs. Visit Grants.gov to learn which might work for you.
  • Venture capital: Venture capital investors take an ownership stake in exchange for funds, so keep in mind that you’d be sacrificing some control over your business. This is generally only available for businesses with high growth potential.
  • Angel investors: Reach out to your entire network in search of people interested in investing in early-stage startups in exchange for a stake. Established angel investors are always looking for good opportunities. 
  • Friends and Family: Reach out to friends and family to provide a business loan or investment in your concept. It’s a good idea to have legal advice when doing so because SEC regulations apply.
  • Crowdfunding: Websites like Kickstarter and Indiegogo offer an increasingly popular low-risk option, in which donors fund your vision. Entrepreneurial crowdfunding sites like Fundable and WeFunder enable multiple investors to fund your business.
  • Personal: Self-fund your business via your savings or the sale of property or other assets.

Bank and SBA loans are probably the best options, other than friends and family, for funding a hot shot business. You might also try crowdfunding if you have an innovative concept. 

Step 8: Apply for Licenses/Permits

Business Licenses and Permits

Starting a hot shot business requires obtaining a number of licenses and permits from local, state, and federal governments. You’ll need to obtain your Operating Authority, also known as an MC number, from the Federal Motor Carrier Safety Administration (FMCSA). Also, liability insurance is mandatory to activate your MC number.

Just like anyone else driving a commercial vehicle, you’ll need a Department of Transportation (DOT) medical card. For this you should book a physical examination with a medical examiner registered with the FMCSA-approved national registry. You’ll also need a USDOT from the FMCSA, which is a unique identifier for commercial vehicles hauling cargo interstate.

Federal regulations, licenses, and permits associated with starting your business include doing business as (DBA), health licenses and permits from the Occupational Safety and Health Administration (OSHA), trademarks, copyrights, patents, and other intellectual properties, as well as industry-specific licenses and permits. 

You may also need state-level and local county or city-based licenses and permits. The license requirements and how to obtain them vary, so check the websites of your state, city, and county governments or contact the appropriate person to learn more. 

You could also check this SBA guide for your state’s requirements, but we recommend using MyCorporation’s Business License Compliance Package. They will research the exact forms you need for your business and state and provide them to ensure you’re fully compliant.

This is not a step to be taken lightly, as failing to comply with legal requirements can result in hefty penalties.

If you feel overwhelmed by this step or don’t know how to begin, it might be a good idea to hire a professional to help you check all the legal boxes.

Step 9: Open a Business Bank Account

Before you start making money, you’ll need a place to keep it, and that requires opening a bank account.

Keeping your business finances separate from your personal account makes it easy to file taxes and track your company’s income, so it’s worth doing even if you’re running your hot shot business as a sole proprietorship. Opening a business bank account is quite simple, and similar to opening a personal one. Most major banks offer accounts tailored for businesses — just inquire at your preferred bank to learn about their rates and features.

Banks vary in terms of offerings, so it’s a good idea to examine your options and select the best plan for you. Once you choose your bank, bring in your EIN (or Social Security Number if you decide on a sole proprietorship), articles of incorporation, and other legal documents and open your new account.

Step 10: Get Business Insurance

Business insurance is an area that often gets overlooked yet it can be vital to your success as an entrepreneur. Insurance protects you from unexpected events that can have a devastating impact on your business.

Here are some types of insurance to consider:

types of business insurance
  • General liability: The most comprehensive type of insurance, acting as a catch-all for many business elements that require coverage. If you get just one kind of insurance, this is it. It even protects against bodily injury and property damage.
  • Business Property: Provides coverage for your equipment and supplies.
  • Equipment Breakdown Insurance: Covers the cost of replacing or repairing equipment that has broken due to mechanical issues.
  • Worker’s compensation: Provides compensation to employees injured on the job.
  • Property: Covers your physical space, whether it is a cart, storefront, or office.
  • Commercial auto: Protection for your company-owned vehicle.
  • Professional liability: Protects against claims from a client who says they suffered a loss due to an error or omission in your work.
  • Business owner’s policy (BOP): This is an insurance plan that acts as an all-in-one insurance policy, a combination of the above insurance types.

Step 11: Prepare to Launch

Launching a Business

As opening day nears, prepare for launch by reviewing and improving some key elements of your business. 

Essential software and tools

Being an entrepreneur often means wearing many hats, from marketing to sales to accounting, which can be overwhelming. Fortunately, many websites and digital tools are available to help simplify many business tasks.  

For independent truckers, the DAT One platform provides a host of features including load boards, factoring services, load tracking, fleet compliance, operating authority services, and more. They also have a mobile application that takes a lot of manual work from the process.

Airtable can also help you manage your hot shot business. Instead of juggling with multiple apps for loads, expenses, and invoices, you can control everything from one program. The app will allow you to integrate third-party apps making it more productive and useful.

Accounting

  • Popular web-based accounting programs for smaller businesses include Quickbooks, Freshbooks, and Xero
  • If you’re unfamiliar with basic accounting, you may want to hire a professional, especially as you begin. The consequences for filing incorrect tax documents can be harsh, so accuracy is crucial. 

Develop your website

Website development is crucial because your site is your online presence and needs to convince prospective clients of your expertise and professionalism.

You can create your own website using website builders. This route is very affordable, but figuring out how to build a website can be time-consuming. If you lack tech-savvy, you can hire a web designer or developer to create a custom website for your business.

They are unlikely to find your website, however, unless you follow Search Engine Optimization (SEO) practices. These are steps that help pages rank higher in the results of top search engines like Google. 

Marketing

Here are some powerful marketing strategies for your future business:

  • Professional Branding — Develop a strong brand image with a well-designed logo, branded trucks, and uniforms to convey speed, reliability, and professionalism.
  • Direct Outreach — Network with businesses that frequently require urgent shipping, like manufacturers and equipment suppliers, through trade shows and networking events.
  • Website Optimization — Optimize your website for local searches relevant to hot shot trucking and emergency shipping services to enhance your online visibility.
  • Local SEO — Regularly update your Google My Business and Yelp profiles to strengthen your local search presence.
  • Social Media Engagement — Leverage LinkedIn for business networking and Facebook for sharing company updates and customer testimonials.
  • Content Marketing — Regularly update a transportation blog and produce video content to provide insights into logistics and the hot shot trucking industry.
  • Email Newsletters — Distribute newsletters to keep clients informed about business developments and industry regulations.
  • Industry Events Participation — Engage actively in logistics conferences and trade shows to connect with potential clients and keep up with industry trends.
  • Customer Referral Programs — Implement a referral program with incentives for clients who bring new business.
  • Loyalty Discounts — Offer discounts to repeat customers to nurture long-term relationships.
  • Local Advertising — Utilize local media and online platforms to target regional clients effectively.
  • Vehicle Branding — Brand your fleet prominently to advertise your services while on the move.

Focus on USPs

unique selling proposition

Unique selling propositions, or USPs, are the characteristics of a product or service that sets it apart from the competition. Customers today are inundated with buying options, so you’ll have a real advantage if they are able to quickly grasp how your hot shot business meets their needs or wishes. It’s wise to do all you can to ensure your USPs stand out on your website and in your marketing and promotional materials, stimulating buyer desire. 

Global pizza chain Domino’s is renowned for its USP: “Hot pizza in 30 minutes or less, guaranteed.” Signature USPs for your hot shot business could be: 

  • Small freight delivered fast!
  • Need waste cleared? Pick-up and removal anytime, 24/7
  • Best rates on local small freight transport, guaranteed 

Networking

You may not like to network or use personal connections for business gain. But your personal and professional networks likely offer considerable untapped business potential. Maybe that Facebook friend you met in college is now running a trucking business, or a LinkedIn contact of yours is connected to dozens of potential clients. Maybe your cousin or neighbor has been working in shipping for years and can offer invaluable insight and industry connections. 

The possibilities are endless, so it’s a good idea to review your personal and professional networks and reach out to those with possible links to or interest in hot shot trucking. You’ll probably generate new customers or find companies with which you could establish a partnership. Online businesses might also consider affiliate marketing as a way to build relationships with potential partners and boost business. 

Step 12: Build Your Team

Building a Team for a New Business

Most of the hot shot businesses are owner-operated which means you may not need to hire employees to run your business. However, if your business grows beyond your capacity to manage it alone, you may need to hire additional staff, including: 

  • Drivers
  • Marketing Lead
  • General Manager

At some point, you may need to hire all of these positions or simply a few, depending on the size and needs of your business. You might also hire multiple workers for a single role or a single worker for multiple roles, again depending on need. 

Free-of-charge methods to recruit employees include posting ads on popular platforms such as LinkedIn, Facebook, or Jobs.com. You might also consider a premium recruitment option, such as advertising on Indeed, Lensa, or ZipRecruiter. Further, if you have the resources, you could consider hiring a recruitment agency to help you find talent.

Step 13: Run a Hot Shot Trucking Business – Start Making Money!

Running a Business

The coronavirus pandemic has led to a surge in ecommerce transactions and presented growth opportunities for the trucking industry, including hot shot trucking. You can still get in on the action in this booming industry if you launch your hot shot trucking business now. 

One way to hit the ground running is to focus on a market niche and jumpstart your word of mouth marketing. For example, you could concentrate on last-mile and time-sensitive shipments such as fresh agricultural products. 

You now have all the business knowledge you need, it’s time to hit the road and launch your hot shot entrepreneurial career! 

Hot Shot Business FAQs

Is a hot shot business profitable?

Hot shot trucking is indeed a profitable business. The average revenue is estimated at $2 per mile while the direct cost is $0.78 per mile, resulting in a 61% gross margin. During peak times, you may expect to make $2,000 to $3,000 per week.

How much does hot shot trucking pay per mile?

It depends upon your location, load and distance. However, the average pay rate is from $1.50 to $2.50 per mile, averaging at $2.0 per mile.

Is there a demand for hot shot trucking?

There is a shortage of truck drivers in the U.S. trucking industry. Trucks are also not feasible to transport freight swiftly in a local area. The only available solution is hot shot trucks. As a result, the demand for hot shot trucks is rampant across the U.S.

Is hot shot trucking a good career?

If you want to pursue a career in the transportation industry, hot shot trucking could be a great starting point. It is a lucrative business opportunity which usually pays more than a traditional trucking job. If you are based in an ideal location, you can easily scale your business to generate above $100k annually.

What hot shot loads pay the most?

Generally, oversized or specialized loads that require expedited delivery and specialized equipment tend to pay more.

What size trailer is best for hot shot trucking?

The best size trailer for hot shot trucking depends on the specific requirements of the loads you intend to haul. Common trailer options for hot shot trucking include flatbed trailers, gooseneck trailers, and smaller enclosed trailers. The choice of trailer should align with the types of loads you plan to transport and comply with local regulations and safety standards.

Can I hot shot with a pickup truck?

Hot shot trucking with a pickup truck is possible, especially for smaller or less demanding loads. However, it’s important to consider the limitations of a pickup truck, such as weight capacity, towing capacity, and size restrictions.

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How to Start a Hot Shot Trucking Business