Is hotshot still worth it?
Freight on the load board is like a roller coaster. It goes up, and it goes down.
The rates have been cheap. It has been rough. Perhaps it’s because it’s the beginning of the year. But towards the end of winter, right before the spring, it starts to pick back up.
So is it over? Is it done? Is it still worth it? Here are the pros and cons of hotshot trucking:
Let’s start with the cons.
The Cons of Hotshot Trucking
1. The rates are really cheap.
This has been the case for many weeks. How can the government help fix cheap rates? Here are some recommendations by some experienced hotshot owner-operators:
- We need to open the country up again.
- We need to raise the broker bond.
- We should make everyone get a CDL.
Those three things will raise the barrier to entry. Once the barrier to entry is higher, the rates go up. That’s how you level out the supply and demand — the free market figuring itself out.
The solution to cheap rates is just to wait until supply and demand is right. So if the rates are really cheap, maybe go to an area where there are a lot of loads but not a lot of trucks. But remember that cheap rates come and go. Rates are like a rollercoaster, a wave that goes up and down. So it pays to wait until the opportunities are better. So just be patient.
2. There are now several YouTube channels documenting the transition from hotshot to semi-truck.
It seems pretty easy to transition from hotshot to semi. But the question is, can hotshot trucking still be a career? Some hotshot truckers believe you should start non-CDL, but eventually transition to a big truck because hotshot trucking is just a stepping stone.
Hotshot trucking is enjoyable but it might not be for everyone. If you have a CDL, go drive a big truck. That’s much better. But if you don’t have a CDL, then this is a good way to test the waters, to see if it’s worth putting the time and effort going to school, getting your CDL — stuff like that.
So we strongly encourage everyone to get a CDL if they can. It’s tough to sleep in a truck. But the experience you will gain in non-CDL is priceless. For example: knowing what a carrier packet is, knowing how to fill one out, knowing how to get insurance, knowing how to haul and secure a load, how to talk to brokers and sales and customer service people, how to dial loads, how to use apps, etc. All of that experience like dispatching and booking freight is so important when you know nothing about CDL or when you know nothing about the trucking industry and how freight moves. All this knowledge transitions well into the semi.
So getting good at this stuff is crucial for your success in trucking. When is it easier to learn — when you have a $3,500 semi-truck payment or when you have a $900 hot shot truck payment? Obviously it’s much easier when you have a cheap truck payment.
True, the load sucks and the rates are cheap. But you’re gaining all this experience, which is ultimately priceless. A lot of people who want to become semi-truck owner-operators have worked at a company driving job for 3-5 years before they became semi-truck owner-operators. Very few people just go out there and become semi-truck owner-operators with zero experience in the business.
3. The insurance is going up
Aside from this, they don’t usually take hotshots less than a year old. So if you are a new hot shot company, chances are they will not take you if your MC is less than a year old. Is there a solution to this problem? Is there a way to lower this insurance?
Insurance companies realized that insuring hotshots is not a good idea. Why? Because hot shots usually don’t make their payments because rates are cheap. Unfortunately that is the free market solving itself. And there is no solution to that other than just being better prepared.
4. The DOT loves picking on hot shots.
They inspect you more perhaps because you’re easier to inspect (or maybe it just seems that way). And the thing is, some hotshot truckers believe they are “tricky” because they don’t just write you up for a violation, but a warning. You can dataQ the violation and get it removed. But you cannot dataQ a warning and get it removed — it stays on your record.
Unfortunately hotshots occasionally overlook equipment maintenance or fine regulatory details. But that’s not good because it’s essentially just a formality for a hotshot. On semis, it’s not just a formality and annual inspection is crucial. Some companies actually require that inspection every six months, even though the DOT only requires an annual inspection. So on a semi that’s crucial. On a hot shot, it’s just like a formality. And sometimes hot shots, in general, avoid some of the formalities that are legally required. Therefore most hotshots have bad safety scores.
So in reality, we are easier to inspect. And so that’s why maybe the DOT does pick on us. So make sure all your ducks are in a row. Really do a good job with running your business, with managing your paperwork.
So, technically, a hotshot is still worth it. As long as you come in with the right frame of mind and your expectations are reasonable and you have a little bit more money in your nest egg, then hot shot might be worth it. You gain a ton of experience that you can use in the trucking industry as a whole.
The Pros of Hotshot Trucking
1. Hotshot trucking is cool, not boring.
Semi-trucking can be quite boring for some. And it’s not that cool for them. Maybe a semi is more comfortable. Maybe the loads are easier. But some hotshot truckers think it’s way cooler. So they would be willing to put up with the challenge of finding freight instead of going to a semi.
2. Driving a truck is only a portion of the business.
Don’t look at one little thing in the business. Driving a truck is only a portion of the business. There’s other portions of the business that you need to focus on and that switching out that part will affect. For example, recording on an iPhone. If you have to switch your camera, how does that affect your YouTube channel? You can no longer airdrop from the iPhone to the computer, so therefore you can edit quicker. Okay. Well, how about a truck? How does that affect you in the trucking business? Well, your truck can be set up so that you don’t keep track of IFTA.
You don’t even have the drug consortium because you’re not required to sign up for it. So switching out a truck means you’d have to start switching all of those things and get prepared for that. It’s not just buying a semi. Not to mention, you’d have to study to get a CDL. And to take the test, you’d have to take time off and lose revenue. On top of that, you don’t even know how to affect your insurance. And so it opens up this whole can of worms where it affects multiple parts of the business.
3. It doesn’t matter what you drive.
It doesn’t matter whether it’s a non-CDL hotshot, a CDL hotshot, a box truck, a reefer, or an expediter. The equipment and what you drive does not matter. You’re still on the road, you’re still away from your family. You’re still out there. You still have to work hard hustling. It’s not like it’s now easier to find loads. All of a sudden you can sit on the couch, play video games and still get paid. You have to still go drive the loads. And so getting into a semi is not the solution.
The Bottom Line
Remember, things can quickly and easily change in trucking. For a couple of weeks, you might be suffering. Rates are at rock bottom. Then, two weeks later, they’re finally good. You see a lot of truckers saying, “Hey, rates are really good.”
So just be patient. When rates are good for truckers, they’re also good for hotshots.