Get the Right Results – Know Which Type of Collection Letters to Use

Published: 25th March 2010
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If we talk about the business operation which any normal businessman deals with, one of the sure chances is inclusion of collection of account receivables as an immediate concern of him, which may be the main cash flow issue for that small businessman.At the heart of this major business concern is the use of well-crafted collection letters that can effectively improve the account receivables outlook of the business. Among all business letters, those used for collection of account receivables usually require the highest degree of attention and preparation.

Knowledge of composing collection letters in a well mannered way and also managing them is proper way to organize account receivables.For this reason, good knowledge of managing and using exact type of collection letters is needed for keeping the clients of that business and make them pay their accounts in proper time.

Collection Letter of Inquiry:
These are the initial collection letters that you send to clients who fail to make payments within the agreed payment terms. The primary objective of this type of collection letters is to remind clients of their overdue accounts and to inquire in a most courteous manner the circumstances that are preventing them from settling their account payables. This type of letter is usually soft in tone, to keep good relationship with the customer, as well as reminding them of their delay of payments Proper choice of words and a flow of well mannerism in the letter help to get the payment quickly as well as maintain good relation with the customer at same time.

When your collection letters create an impression of your willingness to help them out in resolving the collection issue, then your clients will definitely respond in a positive manner in order to settle their accountabilities with your company.The last thing that you want to happen is to alienate them by taking a belligerent stand in the settlement of their accountabilities. This is also the type of collection letters where you can offer special accommodations like extended payment terms and partial payments. Sometimes it is better to go for extended payment terms than insisting on a lump sum payment and not getting payment at all.

Appeal letter collection:
This is the second type of collection letters which you must send to clients who are not able to respond in the desired manner after sending them reminder collection letters.The flow of goodwill in this letter decrease and aggressiveness increase in the tone of these types of letters.There are two ways to approach with these types of letters.When you opt to focus on the positive appeal, you will approach the business communication by appealing to their sense of fairness, pride and desire to keep a good credit standing.On the other hand, if you feel that you won't be getting a positive response from your client, then you may have to use negative appeal by focusing on the dire consequences of their failure to settle their accountabilities.

Ultimatum letters collection:
This is you final collection letter to your client. This type of collection letters informs clients of their final chance to settle the account before legal actions are undertaken. The tone of this type of collection letter is direct and firm.

Check out business letters and collection letters at our site.

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