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Back Hauling, Dead Heading, and Head Hauling – How to Plan & Profit

There are three words in trucker lingo that you need to know – deadhead, backhaul, and head haul – that will determine if you are profitable at trucking or not. According to Ryder Systems citing recent industry research, “Between 15 and 25 percent of the trailers on U.S. roads are empty. For those trailers that are not empty, 36 percent are under-utilized”. That means lost revenue.

First some definitions:

Backhaul

A backhaul is a truckload that a commercial trucker takes on a return trip back to home base. Backhauling is also known as “backloading”. The reason for backhauling is simple, running a truck with an empty trailer means no income while you still have the cost of running it, so it is important for a trucker or his fleet manager to map out driving routes so that revenue cargo is transported every step of the way.

There are two types of backhauling – internal and external.

Internal backhauling involves a trucking company hauling its own goods, such as delivering raw materials to a manufacturing plant and then delivering the finished product to customers. For example, a truck may deliver flour to a commercial bakery and then haul bread to stores. External backhauling is defined as delivering to one company – either its own or a third party – then hauling cargo to yet another company.

An example of backhaul lanes is Florida, where most of the year there is more inbound freight than outbound shipments. Truck carriers are left with empty trucks leaving the state to go to find their next loads. Shippers benefit because carriers are more willing to lower costs in order to get their trucks out of the Florida market. Truckers benefit by not running their trip empty and avoiding having a loss on the trip out of the state.

Finding backhaul loads doesn’t have to be difficult. There are companies that can find them for you. Online backhaul digital load boards are available to search for cargo. There are thousands of loads posted each day on these websites. (See examples below.)

Some services offer rate and market analytics tools in order to negotiate more competitive rates for the trucker with the freight brokers and find more quality backhaul loads. These tools make it easy to find backhaul loads by using up-to-date lane rates and market data from across the country.

Deadhead

A deadhead is what happens when you drop off a load and do not have a new load to return to home base with. Empty trailers are bad for business.

Headhaul

A head haul is an ideal scenario for a trucking company. You drive a head haul when you deliver cargo within the same metropolitan area or a nearby town. Because the deadhead distance is much shorter than a continental trip, you make more money on the cargo.

What Do I Need To Know About Backhauling?

1. Backhauling doesn’t have to be on the cheap. You can make a profit at it.

2. Companies have backhaul tools that can put you in touch with a new load quickly and efficiently so you can hook up and go back home and be paid for the trip.

3. Many backhaul booking companies offer free mobile apps.

4. Backhaul cargos are a normal part of trucking today. The rates are lower than a head haul (see definition above) because there is less demand for them.

Common Backhaul Trucking Freight

Farm Equipment
Reefers (refrigerated trucks)
Dump Trucks
Marine Shipping Containers
Construction Equipment (bulldozers, cranes)
Oil Field Derricks and Rigging
Super Loads (specialized over-dimensional shipments;
standards for how large a shipment can be varied by state.)

How Do I Plan For Backhauling or Headhauling?

Backhauls should be planned the same way that any other outbound shipment is planned.

2. Planning for a backhaul at the same time you plan your initial cargo lane allows you to keep generating revenue.

3. Avoid head hauling whenever possible.

4. Check the digital marketplaces known as load boards to source your next haul.

5. Find a freight broker and a freight agent.

6. Your backhaul strategy should include costs and your break-even point.

7. Plan a “tri-haul route” for more profit. For example, instead of driving from Point A to Point B, drive from say Atlanta to Houston, then Houston to Chattanooga, then Chattanooga back to Atlanta. That is three loads in one trip. Money in the bank.

8. Understand the Department of Transportation rules for how loads are to be distributed in your truck and the proper methods for securing it. Doing it right means no spillage, no accidental dumping, and no overturning trucks.

Maintenance should be accounted for such as the annual cost of keeping your rig running. Expenses include the cost of fuel, leasing or buying tractors and trailers.

Another consideration is the cost of compensation for your drivers which can vary dramatically according to market conditions. Right now with the driver shortage, you may have you raise your driver compensation rates above the national average of 36 cents per mile. You may even have to offer sign-on bonuses in order to attract enough drivers to run your operation efficiently.

Miscellaneous costs should also be included in your plan. These include insurance, permits, and tolls.

Your total cost of trucking can range between $1.38 –$1.59 per mile according to various sources.

What Is the Difference Between A Freight Broker and a Freight Agent?

A freight broker is a middleman who puts shipper loads and trucks together. Freight brokers are also known as property brokers. Freight brokers are licensed by the FMCSA (Federal Motor Carrier Safety Administration).

Freight brokers only hire motor carriers who meet FMCSA guidelines such as insurance and safety standards. They make sure that truckers get paid in a reasonable time frame. Brokers also issue a credit to motor carriers and truckers.

A freight agent coordinates shipments. He or she works under a licensed freight broker. Freight agents communicate between the shipping customer and the trucker or motor carrier. Their responsibility is getting the customer’s freight picked up on time and shipped with no problems. Freight agents can, according to one source, be paid between 50 and 65% of the gross profit generated by each load.

Do Drivers Get Paid Differently?

Drivers do get paid less for backhauls and head hauls, but look at the alternative. If you run your rig without a load you still have the expense (fuel, insurance, lease payments, etc.) of doing it. So a lower-paying load is still better than earning no revenue at all.

An important consideration is the indirect cost of running a truck and trailer. Trucker’s Edge www.truckersedge.net explains it this way:

“You could park your truck instead, and you’d save on fuel, driver pay, and some portion of the maintenance and tires, but you’d still have to pay for insurance and the lease on your equipment. Those are indirect costs. You pay those bills every month, whether your truck moves or not.”

What Can You Expect From Digital Load Boards?

The basic service offered by a digital load board is to match your truck with a specific cargo. A board matches carriers with shippers and brokers. Depending on the board services can include matching freight with trucks, planning and tracking tools, transportation management systems (TMS), analysis of real-time cargo rates, and payment solutions. It is essentially a digital marketplace.

Inquire if the load board is fully integrated with trucking software solutions.

Are you ready to learn more? Talk to a Fleet Advisor today.

There are numerous backhauling companies that can find loads for your trucks. Here are a few:

Online Load Boards to Find Your Next Truck Load

DAT Freight and Analytics – https://www.dat.com/solutions/backhaul-trucking

Heavy Haulers – https://www.heavyhaulers.com/

TruckStop – https://truckstop.com/product/load-board/broker/

Backhaul Direct – https://backhauldirect.com/

SOURCES:

truckstop.com/blog/what-is-backhaul-trucking/

www.heavyequipmenttransport.com/glossary/

blog.freightcenter.com/a-trucking-term-trio-headhaul-backhaul-and-deadhead

ryder.com/blog/thought-leadership/2020-01/backhauls-and-your-transportation-spend

blog.intekfreight-logistics.com/definition-headhaul-backhaul-importance-to-freight-pricing

https://machinetransport.com/2019/02/headhaul-vs-backhaul-do-you-know-the-difference/

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