Starting a hotshot business is an exciting venture that merges your skill behind the wheel with sound business savvy. The demand for expedited freight is a multi-billion dollar market, with consistent need for urgent deliveries in sectors like construction, manufacturing, and oil and gas.
This guide will take you through the practical steps of securing funding, obtaining the necessary licenses, acquiring the right equipment, and finding your first loads to help you launch a successful hotshot business in the U.S.
Step 1: Plan your business and validate the market
Gauge the market and your competition
Your first move is to research active freight lanes. Use resources like DAT Trendlines to see load-to-truck ratios and average rates for specific routes. This data shows you where demand is high and what you can expect to earn.
You should also spend time on trucking forums like The Truckers Report. You can learn what other hotshot drivers charge and the challenges they face in certain regions. This gives you real-world intel you cannot find anywhere else.
Calculate your startup costs
A new dually truck can cost $60,000 to $90,000, while a reliable used one might be $30,000 to $50,000. A new 40-foot gooseneck trailer adds another $15,000 to $25,000 to your budget. One area that often surprises new owners is insurance.
Expect to pay $10,000 to $20,000 for your first year's commercial auto liability and cargo insurance. The cost is higher initially because you have a new motor carrier authority. Also, budget for business registration ($300-$800), permits ($300), and a working capital fund of at least $5,000.
Here are 4 immediate steps to take:
- Analyze three potential freight lanes using DAT Trendlines.
- Create a detailed startup budget with high and low estimates.
- Join an online trucking forum to ask questions about regional markets.
- Research insurance agents who specialize in commercial trucking.
Step 2: Establish your legal entity and get licensed
Choose your business structure
You might want to form a Limited Liability Company (LLC). This structure separates your personal assets from business debts, which protects your home and savings. An LLC also offers pass-through taxation, meaning you report business profits on your personal tax return, avoiding double taxation.
Secure your federal and state authority
You must get operating authority from the Federal Motor Carrier Safety Administration (FMCSA). This involves applying for a USDOT number and a Motor Carrier (MC) number through the FMCSA's portal. The combined application fee is a flat $300.
Next, you need to file a BOC-3 form, which designates a process agent in each state you operate in. This typically costs $25 to $50. You also have to register with the Unified Carrier Registration (UCR) system, with fees starting around $60 for a small fleet.
A frequent misstep is hauling loads before your MC number is active. You must wait for the 21-day vetting period to pass after your authority is granted. Also, check your state’s specific requirements, like International Registration Plan (IRP) apportioned plates for your truck.
Here are 4 immediate steps to take:
- File for an LLC with your state's Secretary of State.
- Apply for your USDOT and MC numbers through the FMCSA portal.
- Designate a process agent by filing a BOC-3 form.
- Register for the Unified Carrier Registration (UCR) system.
Step 3: Secure your insurance and manage risk
Get the right coverage
You will need at least $1,000,000 in commercial auto liability and $100,000 in motor truck cargo insurance. These are the standard minimums most brokers require to book loads. Without this coverage, your business cannot operate.
Your first year's premium can range from $10,000 to $20,000. The cost is higher for new authorities but should decrease over time with a clean safety record. You might also consider physical damage coverage, which protects your truck and trailer from accidents.
Find a specialist agent
A general agent might not understand the FMCSA filing process. A frequent mistake is to go with a cheap quote from a non-specialist, only to find your authority is delayed due to incorrect filings. You want an agent who knows trucking.
With that in mind, you could get quotes from providers like Progressive Commercial, OOIDA, or Great West Casualty. They have extensive experience with new trucking authorities and can often find better rates for the required coverage, ensuring you are compliant from day one.
Here are 4 immediate steps to take:
- Request quotes from at least two trucking insurance specialists.
- Confirm your policy meets the $1,000,000 auto liability minimum.
- Verify you have at least $100,000 in cargo coverage.
- Ask about adding physical damage coverage for your equipment.
Step 4: Acquire your equipment and find a home base
Gear up your rig
Your truck and trailer are just the start. You also need securement equipment. A complete set of tarps, straps, chains, and binders can cost between $1,500 and $3,000. You can find this gear from online suppliers like Mytee Products or US Cargo Control.
A mistake some new operators make is buying cheap tie-downs. This is a bad idea. DOT inspectors will check your gear, and low-quality equipment can put you out of service. Invest in quality from the beginning to protect your loads and your authority.
Secure a place to park
You need a legal place to park your rig. Many residential areas have rules against parking commercial trucks. Check your local city or county zoning ordinances to see what is allowed. This simple check avoids future fines or complaints from neighbors.
Look for secure parking at a truck stop, a self-storage facility, or a small industrial yard. Expect to pay $100 to $300 per month. When you find a spot, try to negotiate a month-to-month lease so you have flexibility as your business grows.
Here are 4 immediate steps to take:
- Create a detailed list of securement gear you need.
- Price out a full equipment package from two different suppliers.
- Contact your local planning department about commercial vehicle parking rules.
- Call a local storage facility to ask about monthly rates for truck parking.
Step 5: Set up your payment and invoicing system
Most brokers pay on Net 30 or Net 60 terms, meaning you wait one or two months for your money. This delay can create serious cash flow problems. To get paid faster, you can use a factoring company, which buys your invoices and pays you within 24-48 hours for a fee of 3-5%.
Handle direct client payments
For loads you find directly, you can get paid on the spot. For hotshot businesses that need to accept payments on-the-go, JIM offers a streamlined solution. With JIM, you can accept debit, credit, and digital wallets directly through your smartphone. Just tap and you are done.
At just 1.99% per transaction with no hidden costs or extra hardware, it is a great fit for collecting payment after a local delivery. Other mobile payment providers often charge rates closer to 3%, so the savings add up. Getting started is straightforward.
- Get Started: Download the JIM app for iOS.
- Make a Sale: Type the sales amount, hit sell, and ask your customer to tap their card or device on your phone.
- Access Funds: Your money is available on your JIM card as soon as the sale is done. There is no wait for bank transfers.
Here are 3 immediate steps to take:
- Research two factoring companies and compare their rates.
- Create a professional invoice template for your direct clients.
- Explore the JIM app for on-the-go payments.
Step 6: Fund your business and manage finances
Secure your startup capital
Equipment financing is a direct path to get your truck and trailer. Companies like Crest Capital or Commercial Fleet Financing specialize in these loans. They often look for a 10-20% down payment and a credit score over 680, with interest rates typically between 8% and 15%.
You might also consider an SBA 7(a) loan. These government-backed loans can offer better terms but require a detailed business plan and take longer to approve. They can cover equipment and provide working capital, often up to $150,000 for a new operation.
Plan for your first six months
A frequent misstep is to budget only for the truck and trailer. You need a healthy working capital fund to survive until payments from brokers start to flow. Plan for at least $15,000 to $25,000 to cover your first six months of operation without stress.
This fund should cover your insurance down payment, fuel, maintenance reserves, and load board subscriptions. It also needs to include your personal salary. Without this buffer, a single unexpected repair or a slow month could put your business at risk before it gets going.
Here are 4 immediate steps to take:
- Request a quote from an equipment financing company.
- Draft a business plan to prepare for an SBA loan application.
- Calculate a detailed six-month operating budget.
- Set aside a personal draw amount in your financial plan.
Step 7: Hire your team and manage operations
Most hotshot businesses begin as a one-person show with you as the owner-operator. You will be the driver, dispatcher, and bookkeeper all at once. This model keeps your initial costs down while you establish a solid customer base and consistent cash flow.
When to hire help
Once you have steady freight, you might hire a company driver. Drivers are typically paid 25-30% of each load's revenue. Remember, if your truck and trailer's combined weight rating exceeds 26,001 pounds, your driver must have a Commercial Driver's License (CDL).
A frequent misstep is bringing on a driver too soon. Before you hire, make sure you have enough consistent work to keep a second truck profitable. You want to see at least three to six months of steady revenue first.
Dispatch and management
As your fleet grows to two or three trucks, a dispatcher is a game-changer. They find and book loads, negotiate rates, and manage routes. This frees you up to run the business. A dispatcher usually earns a 5-10% commission on the loads they book.
To keep everything organized, you can use a Transportation Management System (TMS). Programs like TruckingOffice or AscendTMS centralize your dispatch, invoicing, and load tracking. This prevents paperwork from overwhelming your operation as you scale.
Here are 4 immediate steps to take:
- Confirm if a CDL is required for your specific truck and trailer setup.
- Calculate the weekly revenue needed to profitably support a driver.
- Compare the features of two TMS platforms like TruckingOffice and AscendTMS.
- Draft a job description for a future dispatcher role.
Step 8: Market your business and find loads
Your main source for loads will be digital load boards. DAT and Truckstop.com are the industry standards. A subscription to DAT Power, which offers the best features, runs about $180 per month. This gives you access to thousands of available loads daily.
When you see a load you want, you call the broker. Many new operators make the mistake of focusing only on the rate per mile. You must also calculate your deadhead miles—the unpaid distance to the pickup. A high rate can quickly become unprofitable if the pickup is too far.
Build direct relationships
You can also find freight by contacting shippers directly. This approach cuts out the broker, which means you keep 100% of the revenue. You might want to target local construction firms, equipment rental yards, and manufacturers. A simple website helps you look credible.
Always have your carrier packet ready. This packet should include your MC authority letter, W-9 form, and certificate of insurance. Brokers need this to set you up, and any delay can cost you the load. Be prepared to email it within minutes of the call.
Here are 4 immediate steps to take:
- Subscribe to a load board like DAT or Truckstop.com.
- Create a carrier packet with your MC authority, W-9, and insurance certificate.
- Identify five local businesses that could become direct customers.
- Calculate your all-in cost per mile to quickly assess load profitability.
Step 9: Set your pricing and get paid
Establish your rates
Most hotshot loads are priced per loaded mile. Rates can range from $2.00 to over $3.50 per mile, but this varies by lane and urgency. For local deliveries or dedicated routes, you might offer a flat rate. This gives your client a predictable cost and simplifies your invoicing.
A trap many new operators fall into is forgetting deadhead miles. A high rate looks great until you realize the pickup is 200 miles away. Always calculate your total miles, both paid and unpaid, to see if a load is truly profitable before you accept it.
Know your numbers
Before you can set a price, you must know your cost-per-mile (CPM). This is your break-even point. It includes all your expenses—fuel, insurance, maintenance, and even your salary—divided by the miles you plan to run. Aim for a profit margin of 20-25% above your CPM.
You can use the rate data on load boards like DAT and Truckstop.com to see what the market will bear. This helps you stay competitive without undercutting your own business. Your goal is to find the sweet spot between a fair market rate and your required profit.
Here are 4 immediate steps to take:
- Calculate your all-in cost per mile (CPM).
- Use a load board to research average rates on two target lanes.
- Set a minimum per-mile rate that covers your CPM plus profit.
- Create a simple rate sheet for potential local, flat-rate jobs.
Step 10: Control quality and scale your operation
Your reputation with brokers depends on performance. You should track two key metrics: on-time delivery and damage-free freight. Top operators maintain a 98% or higher on-time rate and a 99.5% damage-free record. Brokers notice these numbers and offer better loads to reliable carriers.
Plan your growth
A frequent mistake is to expand too soon. Before you add a second truck, your first one should consistently generate $15,000 to $20,000 in monthly revenue for at least a quarter. This proves you have a stable freight base to support the added expense.
Once you manage two or more trucks, a Transportation Management System (TMS) becomes a necessity. Programs like TruckingOffice or AscendTMS help you organize dispatch, track revenue per truck, and manage maintenance schedules without paperwork getting out of control.
Here are 4 immediate steps to take:
- Start a spreadsheet to track your on-time and damage-free delivery rates.
- Set a consistent monthly revenue target that signals you are ready to expand.
- Review the features of a TMS for multi-truck operations.
- Calculate the total cost of adding a second truck, including insurance and maintenance.
Starting a hotshot business is about more than just driving. Your success will depend on the relationships you build with brokers and shippers. Remember that reliability is your best asset. Stay focused, drive safe, and you can build a profitable business one load at a time.
When you handle payments from direct clients, a simple approach helps. JIM turns your smartphone into a card reader for a flat 1.99% fee, with no extra hardware needed. It makes getting paid on the spot easy. Download JIM to get started.
