The trucking glossary.

Accessorial

An accessorial is any charge for services beyond simple pickup and delivery, such as detention, extra stops, tarping, layover, driver assist or lumper reimbursement.

All-in rate

An all-in rate is a single quoted figure covering line haul, fuel surcharge and any agreed accessorials, with no separate components listed.

Cash flow

Cash flow is the timing of money entering and leaving the business, which for a carrier is difficult because fuel and drivers are paid weekly while freight invoices settle in thirty days or more.

Contract rate

A contract rate is a price agreed in advance for a lane over a defined period, offering predictable revenue in exchange for committing capacity.

Cost per mile

CPM

Cost per mile is your total operating cost divided by total miles driven, and it is the break-even figure every rate decision should be measured against.

Days to pay

Days to pay is the elapsed time between delivering a load and receiving payment for it, and it determines how much working capital a carrier needs to keep trucks moving.

Depreciation

Depreciation is the reduction in a truck's value over time, and it is a real business cost even though no money leaves the account in the month it accrues.

Detention

Detention is compensation paid to a carrier when a driver is held at a shipper or receiver beyond the agreed free time, usually billed hourly after the first two hours.

Factoring

Factoring is selling your unpaid freight invoices to a third party at a discount in exchange for payment within a day or two, instead of waiting the broker's normal terms.

Fixed costs

Fixed costs are the expenses a trucking business incurs whether or not the truck moves, such as the truck payment, insurance, permits, authority fees and software subscriptions.

Fuel and payment card

Comdata · EFS · Fuel card

A fuel card is a payment card used for diesel and on-road expenses that provides negotiated pricing at participating stops and produces itemised transaction records.

Fuel economy

MPG

Fuel economy is miles travelled per gallon of diesel burned, and because fuel is usually the largest variable cost, small changes in it move profit noticeably.

Fuel surcharge

FSC

A fuel surcharge is a separate per-mile charge added to the line haul rate to offset diesel price movement, usually indexed to a published national or regional average.

Layover

Layover is compensation paid when a driver is held overnight between loads or before a delayed appointment, typically at a flat daily rate agreed in advance.

Line haul

Line haul is the base transportation charge for moving freight from origin to destination, before fuel surcharge and any accessorial charges are added.

Lumper fee

A lumper fee is a charge for third-party labour to load or unload a trailer, common at grocery and food distribution warehouses, and normally reimbursed by the broker or shipper.

Operating ratio

OR

Operating ratio is operating expenses divided by operating revenue, expressed as a percentage, where a lower number means more of each dollar earned is kept.

Profit per load

Profit per load is what a single load left behind after every cost attributable to it, including fuel, dispatch fee, tolls, deadhead and its share of fixed costs.

Quick pay

Quick pay is a broker's offer to pay an invoice within a few days rather than on standard terms, in exchange for a percentage discount off the rate.

Rate per mile

RPM · $/mile

Rate per mile is the load's total pay divided by its miles, and it is the standard way carriers compare one load against another.

Spot rate

A spot rate is the price agreed for a single load at current market conditions, as opposed to a contract rate fixed in advance for a period.

Utilisation

Truck utilisation

Utilisation is the share of available time a truck spends earning revenue, and it determines how much of your fixed cost is spread across paying miles.

Variable costs

Variable costs scale with the miles you run — fuel, maintenance, tyres, tolls and DEF — and they are the costs a routing or equipment decision can actually change.

Bill of lading

BOL

A bill of lading is the document issued at pickup that describes the freight being carried and serves as the contract of carriage, the receipt for the goods, and the document of title.

Carrier packet

A carrier packet is the set of documents a broker requires before tendering freight, typically including authority, insurance certificates, a W-9 and a signed broker–carrier agreement.

Freight claim

A freight claim is a demand for compensation when cargo is lost, damaged or delayed, usually initiated by an exception noted on the delivery receipt.

Invoicing

Invoicing is submitting the completed paperwork package — invoice, signed proof of delivery and supporting receipts — to the broker or shipper to trigger payment.

Proof of delivery

POD

Proof of delivery is the signed document confirming the receiver accepted the freight, and it is normally what a broker requires before an invoice can be paid.

Rate confirmation

Rate con · RC

A rate confirmation is the written agreement a broker sends before a load moves, stating the agreed rate, the pickup and delivery details, and the terms the carrier is accepting.

Backhaul

A backhaul is a load taken on the return leg of a trip, priced to reduce empty miles rather than to earn a full outbound rate.

Consignee

The consignee is the party receiving the freight, named on the bill of lading, and the one whose signature at delivery becomes the proof of delivery.

Deadhead

Empty miles

Deadhead is any distance driven with an empty trailer, most often between a delivery and the next pickup, and it costs fuel and hours without earning revenue.

Dispatch service

A dispatch service books loads, negotiates rates and handles paperwork on a carrier's behalf, usually for a percentage of the revenue on loads it books.

Freight broker

A freight broker is a licensed intermediary who arranges transportation between shippers and carriers without taking possession of the freight, earning the margin between what the shipper pays and the carrier receives.

Headhaul

A headhaul is the primary, better-paying direction of a lane, where freight demand exceeds available trucks.

Less than truckload

LTL

Less than truckload is freight that does not fill a trailer, consolidated with other shipments and moved through a terminal network rather than direct from origin to destination.

Load board

A load board is an online marketplace where brokers and shippers post available freight and carriers search for loads matching their equipment and location.

Shipper

Consignor

The shipper is the party sending the freight and named as consignor on the bill of lading, and is the origin point of the load.

Truckload

FTL

Truckload freight fills a trailer and moves directly from one shipper to one receiver without terminal handling, and it is the segment most owner-operators serve.

Cargo insurance

Cargo insurance covers loss of or damage to the freight a carrier is hauling, and brokers commonly require a minimum limit before tendering a load.

Electronic logging device

ELD

An electronic logging device automatically records a commercial driver's hours of service by connecting to the vehicle's engine, replacing handwritten paper logbooks.

Fuel tax

Fuel tax is the per-gallon tax levied by each state and by the federal government on diesel, reconciled across states for interstate carriers through IFTA.

Heavy vehicle use tax

HVUT · Form 2290

The heavy vehicle use tax is an annual US federal tax on vehicles at or above 55,000 pounds gross weight, reported on Form 2290, with proof of payment required to register the vehicle.

Hours of service

HOS

Hours of service are the federal limits on how long a commercial driver may drive and remain on duty before rest is required, designed to reduce fatigue-related crashes.

IFTA

International Fuel Tax Agreement

IFTA is an agreement among US states and Canadian provinces that lets an interstate carrier file one quarterly fuel tax return, redistributing fuel tax to the jurisdictions where miles were actually driven.

Liability insurance

BIPD · Bodily injury and property damage

Liability insurance covers bodily injury and property damage a carrier causes to others, and federal minimum coverage must be filed with the FMCSA to keep authority active.

MC number

Motor carrier number · Operating authority number

An MC number is the motor carrier authority number granted by the FMCSA that permits a company to transport regulated freight for hire across state lines.

New authority

A new authority is a recently established motor carrier, typically within its first year, a status that affects insurance pricing and which brokers will tender freight.

Operating authority

Operating authority is federal permission to operate as a for-hire motor carrier, defining the type of freight a company may haul and the geography it may serve.

Per diem

Per diem in trucking refers to the deduction or allowance for meals and incidental expenses incurred while away from home overnight on business travel.

Permits and licensing

Permits and licensing are the recurring registrations an interstate carrier must maintain, including apportioned plates, the IFTA licence, the UCR registration and the federal heavy vehicle use tax.

Quarterly estimated taxes

Quarterly estimated taxes are the periodic payments US self-employed carriers make toward income and self-employment tax, because no employer is withholding on their behalf.

Section 179

Section 179 is a US tax provision allowing a business to deduct the cost of qualifying equipment in the year it is placed in service, rather than depreciating it over several years.

Self-employment tax

Self-employment tax is the US federal tax covering Social Security and Medicare contributions for people who work for themselves, paid in addition to income tax on business profit.

USDOT number

A USDOT number is the unique identifier assigned by the Federal Motor Carrier Safety Administration to companies operating commercial vehicles in interstate commerce.

Dry van

A dry van is an enclosed, unrefrigerated trailer used for general palletised freight, and it is the most common trailer type in US truckload transportation.

Flatbed

A flatbed is an open trailer with no sides or roof, used for freight that must be loaded by crane or forklift from the side or above, such as steel, lumber and machinery.

Oversize load

An oversize load exceeds standard legal limits for width, height, length or weight and requires state permits, and often escorts, to travel legally.

Reefer

Refrigerated trailer

A reefer is a refrigerated trailer with its own diesel-powered cooling unit, used for temperature-controlled freight such as produce, frozen goods and pharmaceuticals.

Step deck

Drop deck

A step deck is a flatbed trailer with a lowered rear section, allowing taller freight to travel without exceeding legal height limits.