Trucking Glossary
Plain-English definitions for the terms and acronyms you will encounter in the trucking industry.
A
- Advance Rate
- The percentage of an invoice's face value that a factoring company pays upfront to the carrier, typically ranging from 90% to 97%.
B
- BOC-3 Filing
- A federal form that designates a process agent in each state where a motor carrier operates, required by the FMCSA before operating authority can become active.
C
- CSA Score
- A safety measurement system used by the FMCSA that ranks motor carriers across seven behavior categories (BASICs) based on inspection, crash, and investigation data.
E
- ELD Mandate
- A federal rule requiring most commercial motor vehicle drivers to use FMCSA-registered electronic logging devices to record hours of service instead of paper logs.
F
- Factoring Rate
- The percentage fee a factoring company charges per invoice in exchange for advancing immediate cash to a carrier, typically ranging from 1% to 5%.
- Fuel Surcharge
- A per-mile supplement added to freight rates that adjusts compensation based on current diesel fuel prices, protecting carriers from fuel cost fluctuations.
H
- Hours of Service (HOS) Rules
- Federal regulations that limit how long commercial motor vehicle drivers can drive and work before mandatory rest periods, designed to prevent fatigue-related accidents.
I
- IFTA
- The International Fuel Tax Agreement, a cooperative tax arrangement between US states and Canadian provinces that simplifies fuel tax reporting for carriers operating across multiple jurisdictions.
M
- MC Number
- A unique identifier issued by the FMCSA that grants a motor carrier the authority to transport regulated freight across state lines.
Q
- Quick Pay
- An accelerated payment option offered by freight brokers that pays carriers faster than standard terms in exchange for a percentage fee deducted from the invoice.
R
- Recourse vs Non-Recourse Factoring
- Two types of freight factoring that differ in who bears the financial risk when a broker fails to pay an invoice — the carrier (recourse) or the factoring company (non-recourse).
U
- USDOT Number
- A unique registration number assigned by the FMCSA to identify commercial motor carriers operating in interstate commerce and track their safety information.