When moving trucked freight, the bill of lading and proof of delivery are two important documents with distinct purposes. The bill of lading (BOL) is issued by the freight broker to the carrier, containing details of the shipment, while the proof of delivery is signed by the receiver to confirm delivery. Though they contain some overlapping information, the BOL governs the transportation process, while the POD verifies fulfillment. Understanding how these documents differ is essential for businesses coordinating trucked freight shipping.
In this article, our team at Cowtown Logistics Freight Management will answer all of your questions concerning the bill of lading and the proof of a delivery document, from what exactly they are, to what is written on each, and any other details you'll need to know about both documents before you ship your package.
Bill of Lading Definition
So what does BOL mean? The bill of lading is a necessary document for freight shipment. The shipper fills it out and gives it to the carrier at pickup. BOL could be considered a receipt, a proof of the contract between the shipper and the carrier. It is legally binding and contains all of the details required to process and invoice a freight shipment.
Who Issues the Bill of Lading and How Is It Issued?
A BOL is generally issued by the broker or carrier. It's your job to fill out the bill of lading details on the blank BOL form. Some freight services will allow you to make your BOL for LTL shipments, but for FTL (full truckload) shipments, the shippers must always use their BOL.
A BOL is issued for each truckload, container, or shipment, but is also determined by the specific requirements you have as a shipper. It can depend on the types of goods you are shipping, the letter of credit, and the purchase order, as well as other factors.
Every shipment is unique and there's not always one BOL per shipment. For example, one truckload can have two BOLs due to the specifics of the shipment. There's also the possibility that three truckloads could have just one BOL.
Bill of Lading Information – How to Read a BOL
What does all of this bill of lading information mean? Here's a quick look at the details you should know to help you read a BOL:
- Names and addresses: The names and addresses of the shipper and receiver (consignee) should be legible and visible.
- Purchase orders or reference numbers: These will be required at pickup and delivery of the freight.
- Special instructions: This is the place to write specifications and instructions for the carrier. However, these instructions shouldn't be extra service requests like delivery notifications.
- Date: This is the date that a consignee can expect to receive their shipment and might be used to reconcile shipping invoices or as a reference to track the freight.
- Description of items: This includes dimensions, weight, density, information regarding the materials and their makeup, and quantity of goods.
- Freight class: The freight class categorizes goods based on their density, handling, and liability.
- Packaging type: Include whether you are using cartons, crates, drums, and/or for the shipment.
- NMFC freight class: Freight class impacts how much your freight shipment will cost. Shipments are classified into one of 18 classes based on density, handling, liability, and storability.
- Department of Transportation hazardous material designation: Any hazardous materials within the shipment must be cited, and there will be specific handling requirements.
- BOL number: This is given by the BOL issuer.
Different Types of Bills of Lading
Different BOLs have different terms within their contract and are needed for different shipping situations and scenarios. The list below explains the 18 types of bill of lading that are most commonly used and their different terms
#1. Master Bill of Lading
This BOL is issued by the trucking company, shipping line, or whoever owns the transport vessel being used for the shipment. This BOL is also used between the freight broker and carrier.
#2. House Bill of Lading
This BOL is given to clients by the broker, forwarder, or the non-vessel operating common carrier (NVOCC). This BOL is also known as a forwarder's bill of lading.
#3. Open Bill of Lading
This BOL specifies that if the consignee signs off, then the shipment can be transferred from one consignee to a different, predetermined consignee. This BOL is also known as a negotiable bill of lading.
#4. Order Bill of Lading
This BOL is the most commonly used worldwide and is restricted to being delivered to someone predetermined by the shipper. The bill of lading must be verified by the agent responsible for the delivery.
#5. Bearer Bill of Lading
This BOL dictates that the shipment should be delivered to whoever has the BOL and the consignee can be unspecified and negotiated later at delivery. This BOL is used for bulk shipments that are sent out in small quantities.
#6. Straight Bill of Lading
This BOL is also known as a non-negotiable bill of lading. The shipment is consigned to one specific party and when claiming ownership of the delivery, neither the endorsee nor the endorser is prioritized. The consignee has to pay in advance of receiving the shipment and may, depending on the laws of the destination, be required to have the original bill upon receipt.
#7. Received Shipment Bill of Lading
This temporary BOL is issued when a transport vessel is late. It confirms that the cargo has been received but not necessarily loaded onto the transport vehicle or ship yet. When the shipment has been loaded, it is replaced by a Shipped BOL.
#8. Shipped Bill of Lading
This BOL is issued when the package is already on board the vessel to bind the carrier with the vessel owner.
#9. Ocean Bill of Lading
This BOL is transported both nationally and internationally, using ocean freight.
#10. Inland Bill of Lading
This BOL is used for domestic shipments delivered only on land (rail or road).
#11. Airway Bill of Lading
This non-negotiable BOL is issued by the air freight forwarder or company.
#12. Clean Bill of Lading
The BOL states that the shipment has been loaded into the vessel in good condition and that the packaging and goods cannot be declared defective. If the packaging and/or goods do end up being damaged or incorrect, they can be replaced by a Dirty BOL which we explain below.
#13. Dirty Bill of Lading
This BOL contains a clause that states that the condition of the shipment can be declared “dirty” if there's significant damage to the packaging, broken cargo, the incorrect quantity of goods, etc.
#14. Through Bill of Lading
This BOL is considered a legal document that allows the shipment to be passed from one distribution center to another, through international and domestic borders, and between different modes of transport. An Ocean or Inland BOL might also be necessary, depending on the shipment's final destination.
#15. Combined transport Bill of Lading
This BOL is used when there are two or more modes of transport for this shipment. This legal document is also referred to as the multimodal transport BOL.
#16. Direct Bill of Lading
This BOL is used for cargo that's meant to be both picked up and delivered by the same vehicle and vessel.
#17. Stale Bill of Lading
This BOL is considered “stale” if the shipment arrives at the port before the BOL itself.
#18. Surrender Bill of Lading
This BOL is issued to an importer by an exporter to signify that once the cargo is received, the ownership has been transferred.
Filling Out the Bill of Lading: A Step-By-Step Guide
Crafting a proper bill of lading will not only minimize processing time with officials and customs but also help you avoid delays, fines, and other unpleasant consequences. Here are the steps to do so.
Step 1. Fill Out the "Ship to" and "Ship from" Fields
This is one of the most vital steps when creating a bill of lading. To fill out the "ship to" field, provide accurate contact information for the consignee (the person who will receive and sign for your shipment). Make sure to include their name, address, phone number, and email if available.
The “ship from” field should be filled out with details about the shipper (that's you). Add your company name, address, and other contact info as requested by the carrier. There's also a field for special instructions for the delivery (if any are required for your shipment).
Step 2. Fill Out the Cargo Description and the Carrier Info
In the next step, provide a complete description of the goods being shipped. These include shipment weight (in pounds or kilograms), dimensions, freight class (if applicable), description of cargo, and the package quantity (number of crates, pallets, pieces, etc). Make sure to specify this information as accurately as you can: in case the actual shipment description doesn't match the BOL, you may face additional freight charges.
Fill out the "bill of lading number" field, and make sure to include the trailer number and serial number (if any are available). Specify the terms of charge for the freight (prepaid, collect, or 3rd party). A third party should also be specified in this case.
Step 3. Specify the Shipping Class Correctly
In the freight description section, you must also provide a shipping class and NMFC number. The freight class is determined based on four factors: density of your cargo, stowability, handling, and liability. Make sure to check with the carrier which classes are available in their service before specifying one!
Step 4. Specify Additional Services (If Needed)
In this step, you should specify any additional services that you need for your freight shipment. This can include things like guaranteed delivery time, temperature-controlled transit, special accessorial charges, hazmat, fragile shipment, etc.
Step 5. Double Check the Information and Sign the BOL
Make sure that all information is filled out accurately and that no details are missing. Once everything is checked, sign it off and keep a copy for your records.
And with that, you've successfully created a bill of lading! Now you can prepare your shipment for pickup and be sure that the transaction is documented correctly.
What Is a Proof of Delivery (POD)?
The proof of delivery (POD) is a receipt signed by the consignee after receiving a shipment or cargo. The proof of delivery document confirms that the shipment was delivered at the stipulated time and that there are no damages of any kind, including concealed freight damages.
Before you sign the proof of delivery or proof of shipment, you should follow these guidelines:
- Take or have photographs of what the package looks like before it's shipped.
- If there are any internal or external damages upon delivery, take photographs of them.
- Take time to inspect the condition of the shipment. This includes external packaging conditions to the actual goods beneath the packaging.
If there are damages worth concern, take the following steps:
- Report them within 2 to 5 days of receiving the delivery. You should file your official claim with the carrier soon enough.
- Provide shipment information on the bill of lading and/or proof of delivery document.
- Give your contact information to the consignee.
Doing all of this will help you to successfully file claims in case of damaged goods.
Who Handles the Proof of Delivery?
Being a critical delivery document, the proof of delivery or proof of shipment must be signed by a recognized and authorized official of the receiving company. Examples of such officials are the warehouse manager or the accountant who initially signed the bill of lading.
Companies need to decide who would officially sign POD tracking documents to avoid confusion and misappropriation of roles. Inexperienced personnel may not make a thorough crosscheck before signing the proof of delivery document.
When Do You Sign the POD?
The proof of delivery logistics is signed at the delivery point after you have confirmed that there are no damages to the shipment.
First, you must confirm that it is your shipment or that the shipment was addressed to you. Next, you must check that you received your shipment in its entirety and that there are no third-party shipments packed with yours.
While it's quite easy for an honest consignee to return shipments that are not his, it may not be easy to prove that you didn't get all of your shipments after the proof of delivery document has been signed.
You must always remember that a POD isn't just a receipt of delivery; it's an attestation to the fact that you received all goods in intact condition.
If there are damages you must lay claim to, you should state them in the proof of delivery before signing or you'll have a hard time laying claims if you later discover damaged goods after signing the proof of delivery document.
Cargo Inspection Tips Before POD Signing
Here are a few cargo inspection tips to follow before signing the proof of delivery:
- Record the process: A short video or even a couple of pictures can be your saving evidence when you need to lay claims. You can photograph the shipment before, during, and after unloading. You should also ask the shipper to take photographs.
- Carry out cargo inspection with the truck driver: The truck driver needs to witness the inspection process with you so he/she can also note damages or losses.
- Inspect the cargo thoroughly: Check each package individually. Look out for damaged packaging, shrink wrapping, tampered pallets, tears, holes, stains, and opened packages.
- In case of damages: Take pictures of damages and make a detailed note of them in the proof of delivery. If a package or pallet is damaged, note it in the POD and point it to the truck driver, then go ahead to open such a package and check for damages to the real thing. If there are damages, you should also report it in the proof of delivery document.
- Get the driver's signature: Get the driver to sign the proof of delivery next to your notes on damages.
- Look out for carrier notifications: Some shipments come with notes from the shipper. This could state that the shipment was not properly packaged before shipping. If you get notes like this, then the liability could shift from the carrier to the shipper.
How Does POD Differ from a BOL?
The bill of lading vs proof of delivery difference lies in their purpose and the parties involved. Here's a bullet list summarizing their distinctions:
Bill of lading (BOL):
- A legally binding document that acknowledges the cargo receipt.
- Contains all the details related to the shipment, such as the shipper, consignee, carrier, and goods being transported.
- Typically generated at the point of origin and accompanies the goods throughout their journey.
- Used for freight bill generation and serves as evidence of the contract of carriage.
Proof of delivery (POD):
- Provides evidence of the successful delivery of a shipment to the intended recipient.
- Usually includes the signature of the authorized representative at the delivery location.
- Confirms the completion of the delivery process and attests to the receipt of the goods.
- Does not contain the same level of detailed information as the BOL, but serves as proof of receipt.
Both the BOL and POD are critical documents in the shipping industry, ensuring the accountability and transparency of the cargo's movement from the shipper to the recipient.
Let Professionals Take Care of Your Paperwork!
The bill of lading vs. proof of delivery debate is easy to unravel when you properly understand all the movement points involved in bringing a freight shipment from the seller to the final consumer. The BOL provides the details for transporting the freight, while the POD verifies its delivery.
At Cowtown Logistics Freight Management, our team seamlessly manages these documents to ensure efficient shipping from origin to destination. If you have any inquiries or require assistance with Cowtown Logistics Freight Management's freight shipping services, please feel free to reach out to us. Our team is ready to provide the support you need!
