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What is a bill of lading?

If you’re in the trucking industry, you are probably not unfamiliar with the term “bill of lading.” But what is a bill of lading, and what is the purpose of the document? More importantly, why should you make sure you have one? 

Let’s take a look at what you need to know about a bill of lading (BOL) and how it is vital to all aspects of shipping freight regardless of the method of transportation.

Bill of Lading Explained

A bill of lading is similar to a receipt. It is a legal document that a carrier provides to a shipper. Each bill of lading lists the destination and the type and quantity of goods being shipped. It serves as a contract between the carrier and shipper and must be signed by the shipper, carrier, and receiver of the goods.

How Does a Bill of Lading Work?

When a company intends to ship goods, a bill of lading is created. A company representative and the driver sign the BOL after the product is loaded. Upon delivery of the goods, the receiver signs the BOL to prove that everything listed was received.

Every business that uses some form of shipping relies on BOLs to help prevent asset theft. It is part of an internal control system that is a standard practice today. Here’s how the process works.

How Do You Issue a Bill of Lading?

BOLs are issued per shipment, per truckload, or per container. It is possible to have more than one BOL for a shipment. 

Who Issues a Bill of Lading?

A bill of lading can be issued by the shipping company and is signed by the carrier and the receiver. The BOL is one of the most crucial documents in the entire shipping industry. 

Who Receives the Bill of Lading?

Typically, BOLs are issued with three copies, one for the shipper, one for the consignee, and one for the receiver.

Can a Bill of Lading Be Handwritten?

Handwritten bills of lading are frowned upon due to the potential for errors. Also, the handwriting may not be legible for various reasons. 

3 Purposes of a Bill of Lading

Ultimately, a BOL is undisputed proof of shipment. It serves 3 fundamental purposes in the shipping industry. They are:

1. Documenting Ownership 

A BOL documents who is in possession of the goods along each step in the shipment’s progress from point A to point B.

2. Serving as a Receipt 

As each entity signs the BOL, it serves as proof that all items listed were received.

3. Defining Terms and Conditions

The BOL will include information about the delivery date, time, and payment arrangements that must be adhered to. 

Example of a Bill of Lading

The bill of lading template will differ from one shipper to the next. The format will look different, but the information required is the same. For example, here’s how to fill out a bill of lading. You should include the following:

  • Names and address of shipper and consignee
  • Purchase order and other reference numbers
  • Special instructions for the carrier
  • Pickup date and delivery date
  • Detailed description of items
  • Type of packaging
  • NMFC freight class
  • Bill of lading number
  • DOT hazardous materials designation

A BOL must be issued by the carrier to the shipper to lay out the specifics of a shipment. The bill of lading template or form can be provided by the carrier.

What You Need to Remember About a Bill of Lading

When issuing a bill of lading, it is imperative to remember that this is a legal, binding document. The information must be detailed and accurate for the benefit of everyone involved with the shipment. A simple mistake could result in delaying the shipment or payment.


When creating a BOL, it should include the details of the goods, including units, weight, and dimensions. It should also show the name of the transport vessel, type of packaging used, and nature of the consignment transported. Freight payment terms, hours of operation, carrier information, and special instructions should also be noted.


When the carrier delivers the goods, a bill of lading must be presented. It has all of the information regarding the shipment that will be used to generate an invoice.

3 Different Types of Bills

Different types of BOLs exist based on different situations. The 3 most common forms of BOLs are:

1. Straight Bill of Lading

Used when the cargo is consigned to one specific person. It is a non-negotiable BOL and is often used by the military.

2. Open Bill of Lading

Known as a negotiable BOL, the cargo can be transferred from one consignee to another. As long as there is a consignee signature each time, the goods can be transferred multiple times.

3. Sea Waybill

A document or contract is made between a shipper and the maritime company. Each sea waybill is not a document of title and can only be issued with the shipper’s written consent.

Bill of Lading vs Invoices

The main difference between a bill of lading and an invoice is that invoices show the costs. Invoices are calculated using information from the bill of lading. It’s important to audit the invoice against the BOL to avoid overcharging or undercharging.

Consider an Electronic Bill of Lading

As you can see, the bill of lading is one of the most vital components of the shipping industry. These documents are legally binding, so if they contain errors, somebody loses. 

One way to ensure the accuracy of a BOL is to use a trucking management system that generates electronic bills of lading. Another option is to partner with a 3PL company that will manage the BOLs for you. 

Electronic bill of lading generation minimizes the risk of loss and fraud that is inherent with paper documents. All parties involved in the shipment have immediate access to the information at any time. The e-bill of lading is also more environmentally friendly.

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