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Here’s How To Efficiently Manage Your International Shipping Trade Documents

In this blog, we’ll provide a brief overview of international trade documents such as

  • Bill of Lading

  • House Bill of Lading

  • Master Bill of Lading (MBL)

  • Certificate of Origin

  • Customs Documents

  • Letters of Credit

  • Phytosanitary Certificates and Permits

We’ll also discuss how Logistic Service Providers can efficiently manage all of these documents in a hassle-free manner through an all-in-one cloud-based solution for LSPs, especially freight forwarders. The all-in-one solution we are talking about happens to be India’s leading software for 2+ decades and is being used in 40+ countries around the world.


Digitization and Digitalization - Penetrating the Logistics Industry Ever More


From physical paper documents becoming E-docs (digitization) to freight forwarders, NVOCCs, and other LSPs organizing their entire business in a digital-first way (digitalization), the logistics industry is undergoing a massive change at the moment. The hesitation of businesses to adopt newer technologies were swept aside in just a couple of years by the pandemic, and set the world, including the logistics industry, on a ‘tech-based business framework’ fast track.


Part of this digital revolution, or digitalization, includes digitization, which is nothing but the process of converting hard physical documents into digital documents. The function that digital documents serve is exactly the same as their paper counterparts, which is to furnish crucial information about origin, destination, and content, among other things.


The ‘what are these documents and what functions they serve’ remain the same. Only the ‘how’ part has changed; and for those who have successfully transitioned to the new ‘how’, things have definitely changed for the better.


Brief Introduction to Common International Trade Documents:

  • Bills of Lading

A Bill of Lading serves 3 key functions: it is a receipt for goods that are shipped. It serves as a Document of Title for the goods, and also lays down the detailed agreement between the parties regarding the goods.


A Bill of Lading contains information about

  • Dimensions, weight, quantity of the goods

  • Shipment date, freight classification

  • Nature of goods, whether they are hazardous or non-hazardous

  • Name and address of shipper (consignor) and receiver (consignee)

  • Packaging type

  • Any specific/added instructions for the carrier, and more

Let’s look at the two most common Bills of Lading:


  • House Bill of Lading


A House Bill of Lading is issued by a freight forwarder or an NVOCC to a shipper, acknowledging that the goods dispatched by the shipper have been received.


Freight forwarders and NVOCCs (can be understood as forwarding agents) are the companies hired by the shipper (the exporting company) to oversee the transportation of their cargo, say, between two ports. The freight forwarder or agent then books cargo space, on behalf of the shipper, with carriers. These carriers are the physical transportation providers, moving shipments via truck, air, or sea.


A freight forwarder might have his own carrier services, in-house, or he might sign a contract with a third-party carrier service provider.


  • Master Bill of Lading


The carrier issues the Master Bill of Lading to the party that booked the freight - either the freight forwarder or the NVOCC. A Master Bill of Lading essentially ‘combines’ multiple Bills of Lading, so for example, if a freight forwarder is sending 4 separate kinds of shipment through the same carrier, the carrier, instead of issuing 4 separate bills, will issue 1 Master Bill of Lading.


Another scenario for the carrier is that the shipments could come in from multiple forwarders as well. Since the carrier consolidates all of these shipments into a large shipment, he issues only 1 bill from his end - which is the Master Bill of Lading


  • Certificate of Origin


As the name suggests, this document is used as a proof to determine the origin of the goods that are being shipped. The country of origin/manufacture lets officials ascertain the duty to be levied on the goods, and whether they are actually allowed to be imported as per treaty agreements and the relevant trade regulations.


Other benefits of a Certificate of Origin (CO) includes custom delay prevention, and reduction or elimination of duties in case of falling under ‘Preferential COs’


  • Customs Documents


These provide the basic necessary details to custom officials. Details regarding the quantity of goods, their value and nature are disclosed. A Bill of Entry, Commercial Invoice, and a Packing List are examples of customs documents.


Softlink Global, inventor of India’s leading freight forwarding solution, has a special software helping forwarders clear customs processes on their own, remotely. Explore Live Impex


  • Letters of Credit


This is a financial document that serves as a contractual commitment on behalf of the bank of a foreign buyer, promising to pay the shipper/exporter once the goods are shipped and requisite documents are produced as proof.


Letters of Credit mitigate payment risks and ensure that all the parties in the financial transaction are protected


  • Phytosanitary Certificates and Permits


Googling the word ‘phytosanitary’ gives us the following explanation: ‘relating to the health of plants, especially with respect to the requirements of international trade.’


Phytosanitary certificates are required for a range of plants, timber, and seeds, to confirm that such products do not pose any danger to the agricultural industry of the importing nation.


manage extensive documentation easily


Hardly any other industry can claim to have as sophisticated a paperwork process as logistics. Perhaps ‘stressful’ and ‘complex’ might be the right words to describe the mood of the professional dealing with such paperwork.


Such cases not only affect employee performance and consume his time and productivity, but errors in filing can directly impact project completion and revenue as well. Collateral damage such as customer dissatisfaction and loss of future business are to be expected.


Managing your documents in a digitized manner will result in

  • Improved productivity and efficiency

  • Hours of time saved - cumulating over months and years

  • Smoother business operations

  • Faster turnaround times / process cycles

  • Improved customer experience

  • Ability to take on more business (resulting in more revenue)

India’s leading business application software for freight forwarders, Logi-Sys, allows forwarders to manage all of their documentation from a single source of truth. All of the documentations mentioned above, and more, can be completed through Logi-Sys. Manual entries and submissions are reduced, and there are numerous other associated advantages: revenue leakage plugging, higher automation levels in daily processes, notifications and alerts for important events, and more. All of this in a paperless, tech-first environment that is applicable across your organization, and not just with respect to documentation.


If you want to see Logi-Sys in action, kindly share your details with us here, and we’ll reach out to you and set up a demo.


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