Technology plays a significant role in helping transform business operations and making things much more efficient. Over the last few years, advancements in technology are helping transform the traditional paper-based Bill of Lading to an Electronic Bill of Lading.
The new technology is also known as E Bill of Lading, Electronic Bill, or Digital Bill of Lading. These bills of lading can provide several advantages for parties involved in the supply chain. Getting the most out of your supply chain is essential for modern organizations.
If you’re unclear on how an electronic bill of lading works and how it helps provide organizations with efficiency and improve their supply chain!
What’s A Bill Of Lading?
A bill of lading is a standard document that the goods carrier will issue to the shipper of the goods. The purpose of the document is to serve as proof of shipment. When it comes to international trade, the bill of lading is an incredibly important document.
It’s the documents that serve as proof of who legally owns the cargo. But, in addition to that, it also acts as evidence of Contract of Carriage, a receipt of goods, and a document of title to goods!
The cargo owner (the individual who holds the bill of lading) has legal rights to claim goods or arrange the transfer of cargo ownership to another agent in the supply chain.
What’s An Electronic Bill Of Lading?
The electronic bill of lading refers to a modern digital version of the bill of lading. It performs all the same functions as a traditional bill of lading. In addition, however, the electronic bill of lading helps improve the speed, security, and accuracy of the shipment.
It’s a lot more efficient than manually filing all the paperwork. Before the invention of the e bill of lading, any transfer of essential information was completely dependent on the physical bill of lading. The shippers would need to post the document from another country to the owner’s country.
However, thanks to technology and the invention of the electronic bill of lading, it only takes a matter of seconds to transfer the document. That greatly increases the quality and speed of communication between different supply chain agents.
Why Should You Switch To An Electronic Bill Of Lading?
Before adopting any new technology, it’s essential to analyze the benefits that it provides. These benefits serve as the reasons why organizations should consider switching to an electronic bill of lading format.
Here are the main reasons why you should switch to an electronic bill of lading format!
The main functions of a bill of lading work better when they’re digital. International trade and shipments are confusing enough, and the bill of lading is the standard document that governs everything. It's the legal go-to that helps organizations navigate through negotiations, lending, and reduce their overall risk.
There are three main functions that a bill of lading performs;
- Evidence of contract of carriage
- Confirm receipt of goods
- Serves as the title to the goods
Electronic bills can perform all these functions better and readily increase the speed of international trade! In addition, the very best modern electronic bill solutions help provide advanced security measures, time savings, and cost savings.
2. Completely Paperless
By adopting the bill format, organizations can ensure that the whole process becomes completely paperless. The standard bill of lading is a physical piece of paper that facilitates the transfer of information and ownership of goods.
All the agents that are operating in a supply chain rely on a standard piece of paper to communicate and move the process forward.
An electronic bill, in comparison, is completely digital; they allow you to use electronic signatures and stamps as well. Through the electronic bill of lading, supply chain agents can instantly transfer data, information, and ownership of cargo between one another.
Communication is essential for any supply chain to operate effectively. Henceforth, if each party depends on software systems with integration abilities, it allows for instant information transfer to another system.
They offer effective integration with CRMs, ERPs, accounting systems, and other supply chain software. It helps streamline the whole process and eliminates the need for any data re-entry. In addition, the integration helps with reducing human error, reducing both administration time and cost. An effective system also eliminates the need to store any physical documents.
A lot of people tend to hold the misconception that technology and digital billing are inaccessible. However, that couldn’t be further from the truth. One of the major benefits of the electronic bill of lading format is that it provides easy access to all the documents.
You can view the bill through a web browser on your PC, laptop, tablet, or mobile phone through the internet. Essentially, you can effectively view the documents on any device that can connect to the internet.
Another benefit of working with an electronic bill of lading is that it’s a lot more accurate than the standard bill of lading. A standard bill of lading is essentially an accumulation of information from many different sources. However, every single time there’s a data re-entry, you run the risk of human error.
Alternatively, a digital format helps eliminate the risk of human error. An electronic bill of lading helps ensure that you can integrate the data through supply chain software!
Another major factor that contributes to how smoothly an organization's logistics will function is the accuracy and validity of the information. Even with a traditional bill of lading document, there are some security measures in place to help reduce the risk of fraud.
The question still remains, how does each party involved in the supply chain verify the accuracy of the information. It’s definitely possible for there to be some error in the information if It goes through one too many different channels.
Despite all the security measures in place, a traditional bill of lading document is still prone to the risk of fraud.
In comparison, a digital bill of lading will provide organizations with a much higher level of security. Thanks to developments in technology, the transfer of information online are becoming more secure than ever before.
One of the most secure methods of transferring information online is blockchain technology. Through blockchain technology, organizations can ensure that every actor in the supply chain can get access to relevant information.
No one can change blockchain technology without it being first approved or traced!
Aside from blockchain technology, there’s also end-to-end encryption and two-factor authentication that help ensure that the online exchange of information remains secure.
6. Eliminate Extra Costs
Initially, a lot of organizations were guilty of underestimating the overall cost of postage and shipping documents internationally. However, once you consider the amount of times organizations will need to ship documents in a year, the costs can really add up!
Electronic Storage, Searching and Historical Records
Tracking and storing traditional bills is a major hassle. You’ll have to ensure that you store the paper in a manner that it’s safe from damage. However, the electronic bill of ladings depends on digital storage. Digital storage completely eliminates the need to store physical documents.
Another advantage of digital storage is that it makes it much easier to access old documents. All you’ll need to do is perform a simple search. Every bill of lading can have a reference number or other identifying factor to help identify the specific document.
A bonus that comes from digital storage is that it makes it much easier to create reports and understand trends.
Challenges Of Electronic Bill Of Lading
While there are several different benefits that come with an electronic bill of lading, for an organization to adopt the format successfully, they need to understand the challenges as well.
Here are some challenges that organizations can expect when going for an electronic bill of lading.
An issue that a lot of modern technologies encounter is that a lot of people tend to struggle with adopting new techniques and processes. At first glance, a lot of new software and system seem like the next big thing. However, only when organizations take a closer look will they be able to assess whether an electronic bill of lading format is viable for them.
A lot of eBill software understand that user adoption is essential, and that’s why they focus on a lot and providing a great user experience.
One issue that e-billing does encounter is that there are a lot of countries out there that don’t facilitate electronic billing currently. Only as new laws start coming out will confidence in e-bills start to increase.
Properly integrating modern technologies in your organization is one of the best ways to improve the business. If you’re looking for a one-stop integration solution, you should schedule a meeting with integratz!
Integratz is a leading business integration service provider that helps organization streamline their operations. After scheduling a meeting, you’ll see how your operations improve!