Importance of Business Letter

Letter is as an indispensable tool of communication in business. Business letters are used to sell the products, make inquiry about customers or prices of goods, seek information and advice, maintain good public relation, increase goodwill and perform a variety of other business functions. With the continuous growth of commerce and industry, usefulness and importance of business letter are also increasing gradually. Some points highlighting the benefits or importance of business letter are discussed below:

  • Exchanging business information: Letters are the most economic and convenient means of exchanging information. With the help of letters, executives can easily exchange information with customers, suppliers, investors, government offices; regulatory authorities etc.
  • Establishing business relationship: Business letter play important role in establishing and maintaining relationship with various parties. Business letters reduce the distance between a business and its customers, suppliers, creditors and other public groups.
  • Creation of markets: Circular letter a form of business letter, helps to create new markets for goods and services. This letter contains information about utility, features and usefulness of the products and induces the customer to buy the products.Importance of Business Letter
  • Substitute to personal visit: Introduction of letters in business world relieves the business executives’ form visiting their clients, suppliers, creditors and other public groups by traveling a long distance. For this reason, commercial letters are called alternative technique to personal visit.
  • Saving cost and time: Business letters relieve the busy executives from visiting personally their clients and other concerned parties. Therefore, valuable time and costs can be saved.
  • Maintaining secrecy: Business letters also help to maintain secrecy of information. Non one other than the sender and receiver can know the message contained in the letter.
  • Increasing goodwill: Business letters, like inquiry letter, circular letter, order acknowledgement letter, adjustment grant letter etc help to increase good will of a business with the customers.
  • Formal agreement: Business letter acts as formal agreement between buyer and seller. For example an order letter contains name of items, price, and quantity, time of delivery and mode of payment. All these are regarded as the conditions of agreement between buyer and seller.
  • Settlement of transaction: Commercial letters have paramount importance in setting business transaction. For example, by writing claim letter, buyer can raise his claims to the seller by writing collection letters; seller can collect dues from the customers.
  • Use as reference: Information exchanged through letters can be preserved permanently and used as reference when need arise. Therefore, making business decisions becomes easier.
  • Legal acceptance: Business letter is an acceptable document in the eye of law. It can be stored and produced as a documentary proof.
  • Assistance in local and international trade: Bothe local and foreign trade essentially requires the help of various business letters. Through letters, businessperson make inquiry about products and prices place orders for goods collect the dues make and settle claims etc.

From the above discussion, it can be concluded that successful operation of business activities establishing, maintaining and developing business relationship and finally achieving business goal all require help of business letters. In a sense, conducting business is impossible without business letters.

Steps in Writing an Effective Business Letter

Letters are the most widely used media of written communication in business. But writing an effective letter is not easy matter. It requires well planning, imagination, linguistic knowledge, careful and systematic analysis of situations and above all, writer’s writing skills. However, the following are the various steps through which an effective business letter can be drafted.

  • Proper planning: Effective business letter is the product of good thinking and careful planning. In writing business letter, the writer should go through the proper planning regarding what, when, whom and how to write. A well planned letter is likely to best serve the purpose of the organization.
  • Identifying and setting purpose: Before writing, the writer should know, identify and select the purpose of the letter. In business letters are written for different purpose. Therefore, every business letter must be stated in one or two sentences in the letter.
  • Knowing the audience: In this step, the writer should guess the readers level of understanding and knowledge about the message to the inserted in the letter. Here the writer evaluates what the readers known and what will they do after reading the message. In this connection, the writer should put himself in the readers place and look at the message from the reader’s perspective.
    Steps in Writing an Effective Business Letter
    Determining the scope of subject: Here the writer should determine the scope of the message. The scope of message should be determined by considering two points, one is what the reader wants to know and another is what the writer has to convey.
  • Gathering information: After setting the purpose and scope of the letter, the writer needs to collect necessary information. Generally, information is collected form libraries, taking interview of concerned persons, writers own experience, knowledge and education office file, documents and from other convenient sources. Information should be accurate, relevant and reliable so that these can support the message.
  • Organizing the information: In this stage, the writer decides how the information will be arranged in the letter. It depends on the subject and purpose of the letter. There are basically two approaches for presenting information in the letter. These are direct approach and indirect approach.
  • Selecting the format: In this stage the format of letter is selected. Format of letter is a way or means of presenting various paragraphs in the letter. There are some recognized formats of letter.
  • Outlining the contents: After selecting the format, the next step is to outline the message of the letter. It breaks down a large topic into some convenient parts and paragraphs logically.
  • Writing the first draft: After outlining the contents the next step is writing the first draft. While writing the first draft the writer should keep in mind that it is a working draft. The writer can start wherever he wishes he can start from the middle or even near to end. Any weakness in logic or lack of information or any point that is out of place can be corrected in the final revision.

At last it can be said that when the above stated steps are followed in writing letter, one can expect a good and effective business letter.