A shipping invoice functions largely as a delivery receipt or packing slip. It provides a seller with a legal document that accounts for the items they shipped to a particular buyer. You may have encountered this type of document before without realizing its significance. For example, if you were a small business seller sending something through USPS, FedEx, or DHL, then you have the ability to include a shipping invoice generated when you send something in the mail. Businesses like Amazon and eBay will also sometimes have sellers that include invoices with their packages that mark precisely what you ordered and what you can expect to see in the package.

If you receive an order for products you have in stock, it is time to start learning about this important document and the role it plays in helping you keep your accounting books and notes in order. Let's explore what the shipping invoice is and how people can use it as they send products to their customers.

Understanding a Shipping Invoice vs. a Bill of Lading vs. a Commercial Invoice

If you have a customer who ordered items, you may find yourself looking at a few different terms related to your shipment. In addition to a shipping invoice, you may hear people discussing a Bill of Lading, as well as a commercial invoice.

The Bill of Lading is a shipping invoice that is used to detail precisely what is being shipped by a seller. Courts recognize it as a legal contract between the carrier and the shipping service. Once the final product reaches its destination, the same Bill of Lading can be used as a shipping receipt and signed by the recipient.

A commercial invoice, on the other hand, specifically is designated for shipping internationally. The document plays an important role in getting the shipped items through Customs by detailing the goods contained and the shipping method.

Your shipping invoice, however, is used on shipments large and small to note what you have shipped to a particular buyer.

What Should I Include in the Shipping Invoice?

As you begin to have orders from your small business that require shipping, you want to make sure you understand what goes on your shipping labels and what sections you should include on a shipping invoice template for your business. We will give you a summary that you can use as a checkbox to help you make sure you include all of this helpful information on your shipping invoice.

Your Business Contact Information

Start with your business contact information. Think about the detailed information included on your address labels. You want to list your company name, your address, and how people can get in touch with you, such as your phone number. This will help your customers remember your business in the future, as well. It also helps keep the invoice more professional-looking, as anyone who looks at it knows exactly who the package and invoice came from.

The Information for the Recipient

Your invoice should also include information about the recipient of your product. Including their shipping address and contact information helps to ensure that the product reaches its correct final designation. It also helps to keep all information about the products you ship and your customers clear for anyone reading the document.

The Order Information

The next category of information you want to include describes the order itself. You want the invoice to detail what you ship to the customer so that both of you have the same reference and expectation of what the package should contain. For example, if you ship 15 handmade candlesticks, then note that you have included 15 of the items in the box, as well as a brief description (e.g., blue or flowered). If you have a discrepancy between your shipping invoice and your estimate, such as in the quantity of candlesticks the customer desired, this will help you quickly catch the error.

Your order information should also note the total price of the item you ship. This reminds the customer of how much they spent so that they have no confusion over the order and the amount due for your services.

Any Important Reference Numbers

Once you have included the description of the order, your next step should consist of noting important reference numbers regarding the order. Remember that this shipping invoice plays an important role in your record-keeping. Therefore, you want to make sure it gets appropriately stored alongside your estimate for this job and then any payment receipts or sales receipt you have for the product.

Therefore, your important reference numbers should include a few different types of references.

  • List any purchase order number or estimate number that you have for this order. This will help match it up with your existing records.
  • Note the method of payment, such as through credit card, cash, or PayPal. This will help you ensure that every item you sell receives its proper payment.
  • Include the tracking number of the product. You want to provide customers with the tracking information so you and they can see where the package is throughout its journey. That way, you can let the customer know if you see any delays or other types of problems arise. Similarly, if the customer claims the product did not reach them, you can use the code to track its location and begin the search.

The pricing of the product is not the only number you want to include on your shipping invoice. You want to make sure that you and the customer can easily track the significant information regarding this order from the moment it leaves your office until your customer signs for it on the other end. You want to line it up with your estimates and payment receipts so that you can gauge the success of your business and look for new ways to entice customers to visit your store.

Any Important Notes

Your shipping invoice should also include a section where you can record important notes related to the product. Depending upon what you need to ship and how, you might find that you can use this section to note a variety of different types of information.

  • If the product has specific pick-up instructions, you can note that here.
  • If the product had a particularly long shipment process, you might want to record information like the freight class used and the date picked up by the freighter
  • When you ship something fragile or otherwise at risk, it can also help to note the type of packaging so that the customer knows how you went about protecting the item.
  • Similarly, if the package contains any hazardous material, the shipping invoice will want to include this bit of information.

Many business owners also find that it is a good practice to include a return receipt and instructions with the package. This simplifies the process if the customer realizes that what they ordered does not suit them but does still fit within your return policy. Make sure the customer knows what items you will accept as returns, including the required condition, with the receipt.

Tracking Your Expenses With Skynova

As you run your small business, you will quickly find that shipping service can quickly add up and become a significant expense line on your financing books. Many small businesses find themselves needing to ship so often that they turn to Stamps.com to help them secure the postage they need without having to go to the post office.

As you learn to navigate this part of managing a small business, you may find that your accounting requires special attention. While you update your books, you want to track your ROI on the products you ship to make sure you still generate income when you have to mail items so often. You can also see if your shipping services lead to increased orders from those who want the convenience.

Fortunately, it is easy to manage your financial books with Skynova. Designed specifically as an accounting platform for small business owners, Skynova makes it easy to track income — including shipping costs.

Skynova even offers a range of free templates, such as one for a packing slip, that businesses can customize and use to communicate clearly with their customers. See how this platform as a whole helps you stay on top of your finance books and plot the course for your business growth.

Notice to the Reader

The content within this article is meant to be used as general guidelines regarding invoices and shipping documents and may not apply to your specific situation. Always consult with a professional accountant to ensure that you're meeting accounting standards.