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A Bill of Lading (BOL) is one of the most critical documents in your shipment’s journey. This legally binding document tells the carrier and the shipper every shipment detail they will need along the way.
Sea-faring merchants have been recording their goods and creating contracts with ship captains for centuries. The Bill of Lading is a natural derivative of the necessity for a written record of a shipment’s details.
With crucial details like addresses, packaging type, reference numbers, dates and special instructions, a BOL is a binding contract to ensure your shipment gets promptly to where it’s supposed to be.
And here are four things you need to know about BOLs:
- The primary functions of a BOL are to act as a receipt and title of goods and a contract between shipper and carrier.
- Elements of a BOL include contact details, dates, product specs, freight class and packaging type.
- Understand incoterms for hassle-free shipments.
- Know the different types of goods carriage and BOLS to ensure your shipment has the right documentation for customs clearance.
Need to Know How Much Does Freight Shipping Cost? Check Out This Guide
Why Do You Need a Bill of Lading?
If you are involved with transporting goods, you need to know what a BOL is and how to create one. These documents serve as receipts at the point of origin and the final destination.
Order Packing Materials for Shipping to Protect Your Goods and ProductsEspecially in long oceanic passages and Less-Than-Truckload (LTT) shipments, an accurate BOL is a key to the timely, reasonably priced movement of goods. A Bill of Lading is a contract between the carrier and the shipper, a document of title and a receipt for the shipment all in one.
A BOL is issued by the carrier or the carrier’s agent to acknowledge the cargo’s receipt to be shipped. Initially, a Bill of Lading only referred to shipments transported trans-oceanically, but today a BOL refers to any type of travel and carriage of goods.
Primary Functions of a BOL
The three primary documents that help make the carriage of goods run smoothly and without delays are the BOL, an invoice and an insurance policy. Without these three documents, you won’t be legally allowed to ship any large amounts of cargo.
A BOL serves three main functions:
- As a conclusive receipt of goods being loaded and transported
- As a contract for carriage of goods
- As a title for the goods
Along with these essential purposes, a BOL must be transferable.
If you’re planning a long-distance shipment, you may be wondering, How much does freight shipping cost? The pricing depends on various factors: additional expenses like packing materials for shipping, such as a styrofoam box, distance and transportation manner.
What Is a Bill of Lading?
The specific elements on a BOL must be presented in a particular order, and all parties must sign off on the information before it is made legally official. These elements include:
- Full names and addresses of the shipper and consignee
- Reference numbers or purchase orders
- Any special instructions for transport
- Date
- Shipment description, which includes weight, dimensions and nature of the goods
- Packaging type
- Freight class
- Notification of any hazardous materials with the requisite signage
If any of these elements are missing, they could cause legal issues, stoppages or significant delays. One of the most crucial aspects of a business is to get goods to where you want them to be when you want them to be there. A BOL is the grease that keeps the shipping lanes moving quickly.
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What Are Incoterms?
International Commercial Terms or Incoterms are specific acronyms the shipping industry uses to identify different cargos. These three-letter trade terms are used to communicate costs, tasks, risks and obligations, and they are accepted worldwide.
The type of transportation you are using—whether train, boat, air or road—and whether your shipment crosses borders affects your journey’s complexity and impacts your BOL.
Different Types of Transportation and BOLs
There are different types of BOLs, including an on-board BOL, a received-for-shipment BOL, a straight BOL and an order BOL. Here are the details of each specific type of document:
- On-board – This document guarantees the goods have been physically loaded onto the carrier.
- Received-for-shipment – This document lets you know the shipment has been received but hasn’t necessarily been loaded onto the carrier.
- Straight – This type of BOL denotes the shipment has been paid until the intended party receives it.
- Order – Mainly used when shipping goods before payment, an order BOL necessitates that the carrier transfers the title to the receiver.
The evolution of the ocean bill of lading is a history of goods carriage from centuries ago. How and why this crucial document has been altered, with additional information and obligations, is a fascinating look at how the industry has changed over the years.
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The Final Word
Since the first merchants began to record their shipments’ movement across the oceans, through the Industrial Revolution to the 21st-century global marketplace, Bills of Lading help people do business and transport goods.
In addition to a comprehensive BOL, the right packaging ensures your goods clear customs without issue. If you need high-quality packaging or containers to protect your goods during transit, Air Sea Containers has the best range of packing and labeling materials available.
