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What is a Bill of Lading and Why is it Important to Have One?

Many first-time shippers and many of our fulfillment services clients have a lot of questions about a multi-purpose document called the Bill of Lading (sometimes mistakenly called a “Bill of Loading”). These documents have been around in some form, since the Romans were shipping olive oil across the Mediterranean, and they continue to protect and track cargo today.

How a Bill of Lading Works

When your shipper transfers goods to another carrier, they generate a document called the Bill of Lading, which is a contract that details the terms of shipment of your merchandise, releases the goods into the carrier’s protection and requires them to deliver your items to their destination. Although they’re generated on most commercial shipments, Bills of Lading are particularly helpful for fulfillment services companies and their customers whose goods are frequently exchanged between ground, rail and air shipping.

The Bill of Lading contains detailed information about your shipment, including the type of freight, number of boxes involved and their weight, and is meant to ensure that all of your merchandise arrives at its destination together. If something happens along the way and part or all of your order is damaged or lost, the Bill of Lading provides you with a clear paper trail, along with specific remedies for filing a claim against the carrier who was in charge of your merchandise when it went missing.

Why Fulfillment Services Clients need – and benefit from – a Bill of Lading

When a shipment arrives and it isn’t acceptable in some way, it is the recipient’s responsibility to reject the goods and the shipment on the customer’s behalf. When the recipient is a fulfillment services company like ours, we are acting as the first line of defense and acting on our customer’s behalf. That means that if there is any problem or issue with the shipment, the fulfillment services partner has the right and the responsibility to protect the client and refuse the merchandise.

Small companies that are just beginning to utilize fulfillment services will do themselves a favor by getting familiar with the purpose and importance of the Bill of Lading. The Bill of Lading represents a transference of responsibility for the goods being shipped – the goods of your business – and its importance cannot be understated.

May 16, 2014
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