BOLs: Recent Digital Innovations Drive Efficiency
A bill of lading (BOL) is arguably one the most important parts of a refined fuel transaction, yet one of the most overlooked. Its main functions have remained the same since inception: to serve as both a title and receipt for the commodity being shipped, and also outline the agreed terms and conditions for the transportation of the product.
The BOL has been a part of the process since sea commerce began and hasn’t actually evolved much in hundreds of years. The opportunity for continued digital transformation of this paperwork promises to make the BOL a more efficient and effective tool moving forward. Here’s a quick look at where the BOL started, how it is evolving and the impact on business efficiency and profitability.
A brief history
Bills of lading were first used in the 13th century as a transportation contract. When commerce started to grow between cities, it became necessary to create a system that could function as a receipt for goods received by the merchants and ship owners. The BOL really became important once merchants’ businesses grew so large that the merchants themselves weren’t able to travel at sea themselves with their products. These transportation documents were needed to prevent disputes and to serve as a proof of shipment to protect both the shipper and receiver.
Today, that system hasn’t changed much. A physical piece of paper has been at the center of transactions and the paperwork essentially remains the same. The biggest change is the customizing the document for different businesses and industries, using hundreds of different codes and unique nomenclatures, with no overall standardization at all. In recent years though, there’s been an uptick in the use of electronic BOLs and it is proving to be a game changer for all involved, although it is not without its challenges.
Digital transformation of BOLs
Electronic bills of lading are demonstrating that by eliminating the paper system, eBOLs have the potential to make efficient gains and ultimately increase profitability.
eBOLs have many benefits, with the biggest one being the speed and automation of customer invoicing. It’s becoming common practice in the U.S. to use eBOLs, with more than 300 petroleum marketers using them to automate their invoicing processes.
Electronic BOLs also help with overall accuracy and elimination of mistakes. By not relying on manual data entry, it streamlines efforts and ensures greater accuracy. It also helps with things like catching missing carrier paperwork more quickly, and with the option to save a BOL electronically as a PDF, it helps with reporting and historical information gathering.
This digital transformation faces some challenges though as eBOL use quickly grows. With no standard format or nomenclature, combined with the use of hundreds of different product codes in the fuel industry, the progress with electronic integration becomes more challenging.
The most recent digital innovation in BOLs
Despite the challenges, petroleum marketers are finding one of the latest eBOL innovations to be potentially transformative: a system to account for lost or missing BOLs.
In refined fuels, the average value of one BOL can easily top $15,000. When BOLs are incorrect or lost, revenue and profits are impacted. Not to mention staff time spent on reconciling the information can be used elsewhere.
There are new technologies to help suppliers identify lost documents before customers may realize they were overlooked and ensure BOLs are reconciled in a timely fashion. DTN has a new system, TIMS BOL Recon, that automatically looks for missing BOLs every 24 hours and notifies users if any missing BOLs are found.
A SaaS-based solution can help reduce personnel overhead, realize revenue faster and actually boost transparency between the suppliers and terminals. The DTN BOL Recon system offers a watch list function that allows users to add BOLs to the list. The system will inform the user when it sees that a BOL has been billed.
The digital transformation of BOLs is quickly making the use of these important contracts more effective and efficient with software solutions and advancements in IoT.