What is a shipping invoice?

Panna Kemenes

When shipping goods overseas, it’s important to keep a record of items sent for your books.

This is possible with a shipping invoice. This document details the nature of the transaction and the goods involved.

Also known as a bill of lading, the shipping invoice is necessary for companies sending goods via freight. It also acts as a receipt of purchase that the buyer can use for their records.

This article will cover what a shipping invoice is, how to create one, and some money-saving tips.

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What is a shipping invoice?

A shipment invoice is an important accounting document. It is used to record items shipped from a business to a buyer. The document outlines all details related to the goods involved. These details include weight, quantity, and cost.

It’s a legal necessity for freight shipments, e.g. when sending goods overseas.

If you were shipping products from the US to Canada, for example, you’d send an international shipping invoice with the goods. It serves as a legally-binding document between you, the shipping line, and the consignee.

A commercial shipping invoice can also be known as a bill of lading (BOL), the two terms are used for the same document.

When shipping goods you will also come across a commercial invoice. It’s important to note that a shipping invoice is not the same as a commercial invoice for shipping - just to keep things exciting.

What is the purpose of a bill of lading?

The bill of lading is a valuable document because it’s legally binding. It confirms that you have a legal arrangement with the carrier or shipping line to ship goods to a third party.

Once you send the bill of lading, you acknowledge that your goods made it onto the ship. As such, it acts as a shipping receipt and is added to your books.

It also shows that the goods on the ship belong to you, so there can be no confusion along the ship’s route to its destination.

How do I create a shipping invoice?

To create a shipping invoice, here’s what you need to do:

    1. Decide to use a customizable shipping invoice template or start from scratch.
    2. Next, enter contact information for your company, such as an address and phone number. You can also add an email address and contact person. You’ll then do the same for the recipient’s company.
    3. List shipment details such as the origin and final destination, as well as the time and date you plan to send them out.
    4. Add in a customer reference number and invoice number.
    6. List out the items in the shipment, along with information such as weight and quantity.
    7. Lay out the total cost of the goods along with the individual unit price as you would on a standard invoice. Make sure to include any extra charges such as taxes, shipping services, and anything else agreed upon.

What should a shipping invoice/bill of lading include?

There are many details that can be added to a shipping invoice, but some are compulsory fields. A shipping bill of lading must include the following information:

  • Contact information for both the shipper and the recipient
  • Shipment date
  • Quantity, weight, and cost of goods

For international shipping, add the country you’re shipping to. Include freight Incoterms, classification, and any special instructions for the carrier.

Shipping invoice example

Often, real-world examples help us visualize a type of document or process. Here’s a shipping invoice example that should clarify any doubts you may have.

A toy store needs more racing cars as stock is running low. Once the manager realizes this, they complete a purchase order before sending it off to the appropriate supplier.

The supplier fills a box with the racing cars and signs a bill of lading with a representative from the agreed-upon shipping line.

Now the process is set in motion. Once the shipment arrives, the manager checks that what they ordered is what they received. Once the manager confirms the goods match the shipping invoice, the business owner will sign off on the shipment and pay the supplier.

Pay for international shipping and freight charges with Wise Business

If you have shipping suppliers overseas, then you’ll save money and stress by paying them in their local currency.

With a Wise Business account, you can pay international invoices on time, and at the real mid-market rate. This cuts the cost of doing business overseas.

Register for free and see how the Wise Business account can be a game-changer for your business.

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💡 For all you need to know about invoices, don't forget to read and bookmark the ultimate guide to invoicing from Wise!

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This publication is provided for general information purposes and does not constitute legal, tax or other professional advice from Wise Payments Limited or its subsidiaries and its affiliates, and it is not intended as a substitute for obtaining advice from a financial advisor or any other professional.

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