Category: <span>Supply Chain/Logistics</span>

Unpack the components of essential shipping documents and gain a clear understanding of their role in the shipping process

Shipping labels and logistics documentation may seem like small details in the grand scheme of the logistics world, however, they hold extremely valuable information. An accurate and well-designed shipping label ensures packages and pallets reach their destinations on time, while precise documentation prevents costly delays and disputes. While these pieces are crucial, many people don’t have a full understanding of the critical components that they’re made up of, leaving room for missteps that can manifest into major operational issues.

In this blog, we will break down the essential elements of three key shipping documents: the parcel shipping label, the less-than-truckload (LTL) pallet label, and the bill of lading (BOL). Whether you’re shipping small packages to customers, coordinating freight shipments across the country, or a bit of both, knowing how these components work together can enhance efficiency and ensure consistent reliability in your operations.

The Anatomy of a Parcel Shipping Label

Parcel labels may appear straightforward, but these labels are packed with important information that ensures packages can travel from point A to B without a hitch. Let’s dive into the key elements of a parcel shipping label and what information they provide for the shipping process.

1. Sender and Receiver Details: In the top left corner of the label, you will find the essential contact details of the shipper and receiver (“ship to”) including their full names, street addresses, city, state, and zip code. This information is necessary for the correct delivery of a package.

2. Weight and # of Packages: The top right of the label will indicate the weight of the package as well as the number of packages included in that same shipment. This information ensures proper handling and that multi-parcel shipments are kept together accurately.

3. Unidirectional Code: Also referred to as a “MaxiCode” or “Smart Label”, this code is read by a machine to retrieve essential information about the shipment to help sort and route packages efficiently and accurately while moving through shipping facilities.

4. Routing Code: This section is used by carriers to guide the package through their network and to the appropriate sorting facilities. The first two letters indicate the state, the first three numbers match the beginning of the destination zip code, and the 9-02 code is used by the carrier to determine the delivery area and zone.

5. Shipping Method: This indicates the shipping method selected for the package, such as Ground, 2-Day Air, or Overnight services. The shipping method determines the speed and priority of the delivery and influences how the package is handled in transit.

6. Tracking Number: This number assigned by the carrier acts as a unique identifier for each shipping label that allows both the shipper and receiver to monitor the package’s transportation journey in real-time on the carrier’s website. Tracking numbers are vital for providing visibility and transparency.

7. Barcode: The tracking barcode is one of the most crucial parts of the shipping label as it encodes key shipment details and is scanned at multiple locations throughout the package’s journey. Shipping label barcodes help facilitate automated sorting, routing, and tracking that ensures packages move efficiently through the carrier’s network.

8. Billing Details: This section specifies how a shipment will be billed – Pre-paid (P/P), third-party (T/P), or by freight collect (F/C). Proper billing details ensure that charges are accurately applied, reducing delays or disputes.

9. Reference Details: Relevant reference numbers, such as purchase order (PO) numbers, customer reference numbers, or invoice numbers, may also be included on the label to help shippers or recipients match shipments with internal records.

Best Practices for Accurate Labeling

• Print Quality Matters: Ensure all labels are printed clear and legible, with no ink smudges or fading.
• Proper Placement: All labels should be placed against a flat surface, avoiding any creases or inconsistencies that could affect scanning.
• Double-Check Label Information: It is important to always double check that the label information is accurate to avoid delays or misrouting.

The Anatomy of an LTL/Pallet Label

Different than parcel labels which are designed for individual packages, LTL/pallet labels are generated for freight shipments. These labels make sure that pallets or large shipments are routed, tracked, and delivered correctly, as the transportation process can be highly complex. Let’s take a closer look at the parts of an LTL/pallet label and why they’re crucial for freight logistics.

1. Shipping and Consignee Details: The top left corner of the label displays the name, address, and contact information of the shipper (sender). Slightly below displays the “ship to” or destination information for the consignee (receiver). This information ensures the shipment moves to and from the correct locations.

2. Carrier: The label must display the carrier’s name to indicate which carrier is providing transportation and is responsible for the shipment. This ensures the shipment is put on the correct route and properly handled.

3. PRO Number: The PRO (Progressive Routing Order) number is assigned by the carrier and acts as a unique identifier to provide traceability and visibility of a shipment. This enables monitoring of the shipment through transit to check status and ensure the package is moving where it should be. This number will be the same as the PRO number on the corresponding bill of lading.

4. PRO # Barcode: The PRO number barcode is the visual representation of the PRO number that allows carriers to scan and track the shipment throughout the transit process.

5. Purchase Order (PO) Number: The PO number is a reference code assigned to a specific purchase that helps the shipper and consignee easily link the shipment to its respective order, ensuring accuracy in fulfillment and tracking.

6. Pallet Weight and Pallet Sequence Number: This displays the total weight of the pallet, used by the carrier in calculating shipping costs and ensuring proper handling. Below the weight is the pallet sequence number which helps identify the order in which the pallet should be loaded up and delivered in the event the shipment contains multiple pallets. For example, a shipment that contains three pallets may have labels that display “1 of 3”, “2 of 3”, and “3 of 3”.

The Importance of Consistency and Compliance

• Meeting Standards: Each carrier may have specific requirements for things like label placement, format, and included information. Ensuring adherence to these standards minimizes delays and other potential issues.
• Clear Positioning: Pallet labels should be placed in a visible location to ensure packages are transferred correctly during scanning and manual handling.
• Regular Auditing: Evaluating your label accuracy and processes every so often can help ensure your operations continue to maintain efficiency and meet standards.

The Anatomy of a Bill of Lading

Serving as both a legal contract and receipt of goods, the bill of lading is a valuable logistics document that provides critical details that guide the entire shipment process. An accurate BOL protects all parties involved in the transportation of freight as its three primary functions include:

1. Contract Terms of Carriage: The BOL outlines the terms and conditions that the shipper and carrier agreed upon for transporting and releasing the goods.
2. Receipt of Goods: It provides acknowledgement that the carrier has received those goods in the specified condition and has loaded them onto the vehicle of transportation.
3. Title to Goods: The BOL can act as a title agreement, granting legal ownership of the goods and must be presented to the shipper in order for the goods to be handed over.

Let’s break down its components and the important role they play for each freight shipment.

1. Shipper and Consignee Details: Both the “ship from” and “ship to” sections clearly identify the shipper’s (sender) and consignee’s (receiver) information including name and address or destination. This ensures the goods are delivered to the correct destination.

2. BOL Number: The BOL number acts as a unique identifier for the Bill of Lading documentation, enabling the shipper and carrier to track and reference the shipment throughout its transportation.

3. Carrier Name: This identifies the carrier that is responsible for transporting the shipment to its destination and ensures all involved parties are aware of what carrier is handling the goods throughout transit.

4. Standard Carrier Alpha Code (SCAC): An SCAC code is two to four letters given to a carrier for identification, tracking, and billing purposes. This ensures billing and payment processing is completed accurately.

5. PRO Number: The PRO (Progressive Routing Order) number is assigned by the carrier and acts as a unique identifier to provide traceability and visibility of a shipment. This enables monitoring of the shipment through transit to check status and ensure the package is moving where it should be. This number will be the same as the PRO number on the corresponding pallet label.

6. Special Instructions and Accessorial Charges: This area provides any specific requirements or handling instructions for the goods as well as additional charges that might apply to the shipment, such as liftgate usage, residential delivery, and hazardous materials handling.

7. Payment Terms: The freight charge terms disclose payment details including who is responsible for the freight charge and the payment method (prepaid, collect, or billed to a third-party).

8. Shipment Breakdown by Customer PO #: This section lists the PO number(s) included in the shipment, as well as the number of packages and weight associated with each PO number. This helps the shipper and consignee accurately match up the shipments to their specific orders.

9. NMFC Code and Class: The National Motor Freight Classification (NMFC) code is a number assigned to determine the proper classification of the shipment based on the freight’s characteristics, such as size, handling, weight, and liability. The class helps determine the shipping cost in a range from 50 (least expensive) to 500 (most expensive).

10. Shipment Breakdown by NMFC Code: A breakdown of the goods by their NMFC code ensures that the correct freight classification is applied, which is crucial for billing, insurance, and determining the shipment’s handling requirements. This information includes unit type and quantity, package type and quantity, weight, and description.

11. Collect on Delivery: This amount indicates the cost of the goods being shipped without the cost of freight included and whether it should be paid by the consignee upon delivery or if the amount was prepaid. This amount can be collected by the carrier on behalf of the shipper to ensure the goods are paid for before they are released.

12. Signature Section: The signature section of a BOL requires three separate signatures: One from the shipper to ensure the freight is sent out in good order, one from the carrier to acknowledge the freight was received in good order from the shipper, and one from the consignee to confirm the freight was received in good order at its destination.

How the BOL and Pallet Label Work Together

In freight shipping, the bill of lading and LTL/pallet label work hand-in-hand, each playing their distinct but complementary role. The BOL is responsible for establishing the shipment’s contract terms and overarching legal and logistical documentation. At the same time, the label acts as the shipment’s physical identification, providing visual and scannable key information such as the PRO number and destination details. When paired together, they create a seamless workflow that enables freight shipments to move accurately and efficiently through the shipment process.

The Role of Automated Shipping Software in Shipping Documentation

As supply chains continue to grow more complex, outdated methods of manually managing shipping documentation are no longer efficient as they are not only time-consuming but highly prone to errors. Businesses need an advanced tool, such as automated multi-carrier shipping software, to help revolutionize the way they handle their shipping documentation processes by:

• Streamlining Documentation Creation: Automates the generation of labels, BOLs, and LTL documentation with minimal input, ensuring consistency and compliance.
• Enhancing Accuracy: Reduces human error through auto-population, validation, and standardized formatting of shipping details.
• Increasing Operational Efficiency: Speeds up workflows with batch processing, quick adjustments, and instant sharing of documents.
• Improving Scalability: Adapts to growing shipping volumes with various supporting carriers, centralized visibility, and seamless integrations.

Simplifying Shipping Documentation with Varsity Logistics Multi-Carrier Shipping Software

Designed exclusively for shippers on IBM i (AS/400) Power Systems, Varsity Logistics is an industry leading multi-carrier shipping software provider. Not only do we have a comprehensive suite of supply chain execution modules for both parcel and freight, but our solution also empowers shippers to seamlessly rate shop between parcel and LTL shipments – ensuring they select the most cost-effective option while managing shipping documentation efficiently and accurately.

How Varsity’s Software Revolutionizes Shipping Documentation

• Automated Label and BOL Generation: Varsity’s software automates the creation of parcel and LTL labels, as well as bills of lading, ensuring all documents are consistent, accurate, and compliant with carrier-specific requirements while speeding up workflows.
• Seamless Multi-Carrier Support: The platform supports a wide range of carriers, including all leading carriers in North America, enabling shippers to generate documentation that adheres to each carrier’s unique standards.
• Real-Time Data Integration: By pulling information directly from your enterprise resource planning (ERP) system or warehouse management system (WMS) with our seamless integrations, Varsity eliminates manual data entry, minimizing errors and saving valuable time.
• Barcode Integration for Enhanced Traceability: The software automatically generates tracking and PRO numbers, eliminating the reliance on premade carrier tracking sticker labels. It also incorporates scannable barcodes into labels and BOLs, facilitating real-time tracking and visibility throughout the shipping process.

Developed to handle the complexities of parcel and freight shipping from one centralized application, Varsity’s multi-carrier shipping software is a valuable player on every IBM i shippers’ team. As your business grows, Varsity’s platform scales with you, handling increased shipment volumes and a growing number of carriers with ease.

Whether you’re looking to reduce errors, speed up workflows, or optimize your shipping processes, Varsity Logistics can help you master the complexities of shipping documentation to achieve seamless shipping success. And with accurate labels and streamlined processes comes on-time deliveries and satisfied customers, enhancing the overall customer experience while ensuring your operations run smoothly.

Ready to explore how Varsity Logistics can help reduce shipping headaches and eliminate shipping documentation challenges? Contact our team of shipping experts or schedule a pressure-free demo today and discover how Varsity can help take your shipping game to the next level.