A bill of lading is one of the most important pieces of documentation that a shipper and receiver (consignee) will formalize during the shipping process. A clearing and forwarding agent will be familiar with the steps that need to be taken to ensure that when any cargo is shipped, this paperwork is completed correctly. The accuracy of this document is of high importance.
There are three basic reasons why a bill of lading is necessary, and these include evidence that there is a contract of carriage, evidence of the receipt of goods, and evidence of the document of title and who owns the shipment. A bill of lading also has different acronyms and is also known as an Ocean Bill of lading (OBL), an Airway Bill of Lading (AWB), or ProBill, which is used for ground transportation, mostly trucks.
What is Included in a Bill of Lading?
The straightforward definition of a Bill of Lading is simply a required document to move freight. However, there is much more to this document than a short description will allow. It is crucial to note what items must be included in this document to understand why it is so important to the shipping industry.
The most obvious information that should be on the bill are the names and addresses of both the shipper and the receiver. These names should be written or printed so that it is legible and easy to read. There should also be the printed purchase order numbers or reference numbers. These numbers are needed to ensure that the cargo can be released once it arrives at its destination.
Any special instructions for delivery should also be on this document. This information is an extension of the basic requirements for delivery, but important none-the-less. The date, the day of pick-up, and the location if unique must also be on the bill.
The clearing and forwarding agent will make sure that there is a clear and organized description of the items being transported, and that there is a complete list of the number of shipping units, the dimensions of the units and weight, and any pertinent information about the cargo that shipping officials may need to expedite the shipment.
Although it may be apparent what kind of packaging is being used, it is still expected that the bill notes whether the cargo contains cartons, crates, pallets, or drums, or a combination of containers. Very important here, is identifying the NMFC Weight Class. The class that cargo is placed in can determine the cost of the shipment, and that is why this should be very accurate. There are 18 different classes, and these are based on value and liability, weight, dimensions, ease of handling, storage capability, and density.
Lastly, but of utmost importance, is whether the cargo is composed of hazardous material. There are special rules for this kind of shipment, and the clearing and forwarding agent will have the expertise to record this properly.
Why Do You Need This Document?
The Bill of Lading is a legal document, and it legally binds the shipper to deliver the material and also binds the receiver to accept the material. The contract to provide the transportation of the cargo was actually created when the shipper agreed with the receiver to move the cargo from one place to another. The Bill of Lading is the evidence of this contract, and that is why the information on the bill has to be accurate and timely.
The Bill of Lading is also a record of the fact that the merchandise has been delivered, and that the correct receiver has received it. Once this action is completed, the delivery has been established.
Finally, The Bill of Lading is a Document of Title, which means that whoever holds this document is the owner of the cargo. It also acts as the basis for the invoice once the transaction is billed and the service paid for.