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.
• 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.