What Is A Shipping Invoice? A Bill Of Lading Guide For Small Businesses
A shipping invoice is an accounting document used by businesses to provide a record of the products shipped from a seller to a buyer. The shipping invoice, also called a bill of lading, is a legal document that is required any time a company sends a freight shipment of goods. As with other types of invoices, shipping invoices serve as a receipt for freight shipments. They’re similar to commercial invoices, which are also used for shipping goods across international borders.
These topics will help you better understand what a shipping invoice is and when to use one:
What is a Bill of Lading?
A bill of lading is a legal document that outlines the details of a freight shipment, including the type of goods transported, the quantity of goods, the total cost and the final destination of the shipment. Because it’s a legal document, the bill of lading also serves as a binding contract between the freight carrier and the shipper.
The bill of lading acts as a shipping receipt when the goods arrive at their intended destination. The invoice must be shipped along with the goods sold and should be signed by the shipper and the person receiving the shipment. The term bill of lading is most often used in reference to international trade. The word lading refers to the process of loading a ship with cargo.
What Needs to Be Included on a Bill of Lading?
There is specific information that every bill of lading should include. The bill of lading provides documentation of the goods being shipped, the quantity of items, the value of the shipment and the final destination for the cargo. Here is everything you need to include on a bill of lading for international shipping:
1. Shipper’s Contact Information
First on your bill of lading, you’ll need to include the shipper’s contact information clearly on the invoice, including the full name and business address.
2. Receiver’s Contact Information
Your bill of lading must also include the receiver or consignee’s contact details written clearly, with the full name and mailing address.
3. Purchase Order Numbers or Reference Numbers
The purchase order number and any other reference number are necessary for record keeping purposes. They may also be used in order to release the shipment for delivery or pick up.
4. Instructions and Notes
There is a section on the bill of lading that leaves room for special instructions and notes for the carrier about the specific shipment.
5. Pick-up Date
The bill of lading should list the date on which the shipment was picked up by the carrier. The pick-up date is often used to track the cargo and is also useful when reconciling shipping invoices.
6. Description of Goods
Your bill of lading should include a full description of the items being shipped, including the quantity of items, the dimensions and weight of each product and details of the materials shipped.
7. Packaging Type
A bill of lading should also list the type of packaging used for the shipment, such as cartons, crates, drums or pallets.
8. Freight Class
There are 18 different classes of freight shipments. The different classifications are based on factors such as dimension, weight, ease of handling, value and liability. You should always label the freight class of your shipment.
9. Any Special Designations
Sometimes, the shipment will be subject to a special designation based on its contents. For example, hazardous materials need to be designated as such because special rules and regulations apply to the shipment of hazardous goods.
Shipping Invoice Example
Shipping invoices include greater detail than most invoices generated by businesses. They include detailed information about the size, weight, packaging and contents of the shipment. This shipping invoice sample prepared by UPS will help you better understand all the information that must be included when shipping goods internationally: