What Is a Contract Carrier?

A contract carrier is a transportation carrier that serves specific customers under contract with one or a limited number of customers as opposed to a common carrier, which transports freight for the public. Utilizing a contract carrier ensures a committed capacity for a company's cargo just as it ensures a steady stream of income for the driver. Depending on the size of the contract and the amount of cargo that needs transported, a contract carrier may be under contract with more than one customer at a time.