Purpose
Otherwise known as Shipper’s Letter of Instruction (SLI), this document serves as instructions from the Exporter to the Freight Forwarder, providing the scope of services required as well as essential information for documentation and transport-related guidance.
Sender
Exporter/Consignor, who provides instructions and information in respect to the instructions related to the shipment
Receiver
Freight forwarder or logistics service provider.
Legal framework
There is no law, rule or regulation that mandates the issuance of this document however in practice it is issued for every transaction.
Usage
While not mandatory for international trade, export instructions are frequently issued by consignors to freight forwarders through various electronic means, such as email. This document plays a crucial role in logistics transactions between consignors, brokers, or traders.
Key standards
Globally, there are established standards for this document commonly referred to as the Shipper’s Letter of Instructions, which individual shippers issue based on their legal or commercial needs. The International Federation of Freight Forwarders Associations (FIATA), on the other hand, has introduced a standardised document known as the “FIATA Forwarders Instructions” (FFI), with plans to develop a digital version aligned with the UN/CEFACT MMT-RDM.
Major differences between standards
The issuance of this document lacks a formal standard or guideline, resulting in challenges when distinguishing between various standards. Different organisations or industries utilise their unique formats created internally, causing minor variations in this common form that provides instructions to Freight Forwarders. Typically, it is exchanged via email in formats such as PDF, DOC, or as plain text within the email body.
Platforms
This document holds significant importance in international trade as it serves as the initial information source for tracking the movement of goods. In specific industries like Grain and Coffee trading, private platforms like Covantis and Cargoo have successfully onboarded a substantial portion, accounting for over 60% of the industry’s participants.
Adoption
To boost the digital adoption of the Shipper’s Letter of Instruction (SLI), several strategic steps can be taken:
- Education and awareness: Shippers should be educated about the advantages of going digital, like reduced paperwork, quicker processing, and enhanced accuracy.
- Standardisation: Establish industry-wide standards for digital SLIs to ensure compatibility across different platforms and systems, reducing the learning curve for shippers.
By implementing these measures, the adoption of digital SLIs can be enhanced, resulting in a more efficient and streamlined shipping process for all stakeholders involved.
