Writing Formal Letters – CA Foundation BCR Notes

Writing Formal Letters – CA Foundation BCR Notes

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Writing Formal Letters – BCR Notes CA Foundation

Letters are the most popular form of written communication. In business, letters are an indispensable means of communication. Letters enable a business enterprise to keep in touch with its customers, branches, suppliers, investors, etc. There is an old saying “A business is known by the letters it writes.” Letters reflect the image of the organisation where they originate.

Need and Functions of Business Letters:
According to Gartside, there are four main reasons for writing business letters:

  • to provide a convenient and inexpensive means of communication without personal contact
  • to seek or give information
  • to furnish evidence of transactions entered into
  • to provide a record for future reference.

In addition, business correspondence is aimed at building goodwill by creating a good image of the organisation in the minds of readers.

These various functions of a business letter are explained below:
1. Widen Contacts:
A business concern cannot send its representatives to each and every place of connections. But it can approach all persons through letters. It is difficult to approach in person busy executives, professionals and Government officials. However, a letter has easy access to one and all. In this way, letters help to widen the area of operations.

2. Sharing Information:
With the help of letters, a business firm can exchange information of varied type with different parties. Business houses send circular letters to share information about opening of a new branch, expansion/renovation of an existing branch, change of ad-dress, launching of a new product, announcing an agency, clearance sale, admission of new partner, etc. Similarly, a business firm may send a letter enquiring about the credit status of a customer or it may send reply to such an enquiry from other firms.

3. Authoritative Proof:
Letters written and signed by responsible persons are a conclusive proof of business transactions. These can be used as documentary evidence in a court of law in case of disputes. Letters are a written communication. Therefore, action can be taken, re-sponsibilities can be fixed and mistakes can be pointed out on the basis of letters. It is for this reason that oral messages on telephone require confirmation in writing.

4. Record and Reference:
Letters can be preserved for future reference. The message can be passed on in its totality. It is often necessary in business correspondence to quote back references. It is not possible to remember all the details of previous transactions. Copies of letters sent and received provide knowledge of past transactions. With the help of such knowledge, a businessman can run his business easily and correctly.

5. Building Goodwill:
A good business letter serves to project a good image of the business. It helps to make friends, improve the company’s prestige and build goodwill. It is a silent sales-man.

6. Lasting Impression:
The impact of an oral message is felt when it is heard. On the other hand, a letter makes a lasting impression on the reader’s mind because it stays with him, goes with him and reminds him every time it is read. It maintains a personal tone and waits till the reader finds time to look at it.

Writing Formal Letters – CA Foundation BCR Notes

Essentials of Effective Business Letters:
Letter writing is an art and mastery over this art requires practice. While writing business letters the following qualities must be ensured:
1. Clarity:
The message contained in a letter must be clear at first reading. The letter written must be clear both in thought and expression. A letter reflects the writer’s mind. Therefore, he must be absolutely clear in his mind about the message to be conveyed and its purpose. Clarity of expressions means use of appropriate words.

All the facts and figures must be stated in the simplest possible words. There is no scope for ambiguity and flowery language in an effective letter. Therefore, vague and technical words should be avoided. For example, goods are being sent very soon is a vague statement. Goods are being sent on 11th March, 2002 is clear.

2. Simplicity:
Good business letters must be written in very simple and lucid language. Such language makes an instant impression. Short and simple sentences should be used in place of long and uneven sentences. Often business letters are written in a stiff and detached style which is undesirable. Simple and familiar language is better than “Commercial English”. A few examples of typical commercial English are given below along with simpler alternatives:

Typical Expression Simple Alternative
I am in receipt of your letter Thank you for your letter
I beg to acknowledge receipt of your letter Thank you for your letter
Your letter dated 10th instant is in our hands for which we thank you Thank you for your letter of 10th

Kindly acknowledge receipt of same or Please send a receipt for it.
Enclosed herewith please find the cheque. We enclose a cheque for ₹ 10,000 to the value of ₹ 10,000

3. Conversational Style:
Like all communications a letter is basically conversational in nature. An effective letter should be like a dialogue with the reader. It should be written in a friendly and conversational style. Dull and stiff style has no place in good letters.

4. Correctness:
A good letter has to be correct in every respect e.g., contents, layout, spellings, grammar, etc. If the letter involves some legal matter, ascertain the correct position before you commit anything.

Incorrect language spoils the message, distracts the readers attention and harms the image of the sender. Untidy appearance, typing mistakes, uneven spacing all should be avoided. In order to ensure accuracy, the letter writer must have knowledge of the firms policies and needs, of previous correspondence, etc. Effective letters should be coherent with proper emphasis. All letters should be sent and answered at the right time.

5. Courtesy:
A courteous letter has the best chance of getting a favourable response. If you want favours seek them politely. Apologise sincerely for your mistakes and thank generously for favours received. A personal touch and Refrain from preaching. Elementary, obvious and flat statements often sound preachy. Avoid angry tone and exaggeration. You view point wording is very useful in negative (bad news) messages.

For example:
When you reject the client’s request for credit, view the situation from the client’s point of view to find out one explanation that would be most convincing to him. Then present the explanation in you point language. The explanation might be: “As an experienced businessman well acquainted with finance, you will understand why we must limit our credit to our working capital resources.” Some more examples of ‘you attitude’ writing are given below:

We are happy to have your order dated 15th December Your order of 15th December has been received
We have received your report of July 7 Thank you for your report of July 7
We have sent the twenty copies of Communication Skills by Dr. C.B. Gupta Your twenty copies of Communication Skills by Dr. C.B. Gupta should reach you with this letter.

6. You Attitude:
A good business letter should reflect the writer’s interest in the receiver. The message should be adapted to the cultural background, vocabulary, psychological make-up, etc. of the reader. You attitude means viewing things from the viewpoint of the reader. A few examples of ‘I/We attitude and ‘you attitude’ are given below:

We Attitude You Attitude
We are happy to report You will be happy to learn
We are in receipt of your letter dated 21st March Thank you for your letter of 21st March
We are pleased to have your new account Your new account is now open for your convenience.

7. Positive Words:
Business letters reflect the image of the company. Therefore, all business correspondence should be written so as to enhance the company’s image. Positive language should be used in place of negative words such as ‘failure’, ‘damage’, ‘refuse’ etc. Words that stir up positive, meaning in the reader’s mind help to make the letter persuasive. Such words create a positive image and induce the reader towards desired action.

For example, “We regret to inform you that we cannot grant the credit requested by you” creates a negative and unhappy impression. “Because of the heavy amount of book debt, the best we can do is offer you one week credit” is better.
Emphasize the right points. In case of international correspondence, take care of cultural differences, write simply and clearly.

8. Coherence:
Your letter should be coherent. The relationship between different parts of the letter must be clear. Arrange the informative in logical order. Transitional devices like tie-in sentences, repetition of key words, and transitional words help to ensure coherence.

9. Persuasion:
Business letters should be written in a persuasive and tactful manner. Well- drafted sales letters are the best example of persuasive writing. Similarly, a job applicant can ‘sell’ himself better to the employer by adopting a persuasive tone. Words that stirrup positive feelings are persuasive. For example, “we regret to inform that we cannot grant the credit requested by you” creates a negative impression. “Because of the heavy amount of book debts, we are unable to grant you credit” is a better expression.

10. Sincerity:
Effective letters must reflect genuineness of feelings concern for the reader and legitimacy of claims made.

11. Completeness:
In business correspondence, completeness of facts is absolutely essential. Incomplete messages lead to irritation and wrong actions. Omission of an important word can create ambiguity. Therefore all the necessary details should be included in the letter. A letter is complete when it contains all the necessary facts and information for the particular objective or situation. While answering a letter ensure that all the necessary questions have been replied to. For example if the letter contains a purchase order, specify the quantity, size etc. of the goods required, mode of dispatch, date, by which goods should reach you, mode of payment etc.

Business letters deal with crucial matters. Therefore, these should be drafted and edited before being mail. The letter should be well organized and written with clarity and precision. It should contain proper salutation and superscription. It should be properly typed. It should adhere to a formal or official letter. The first paragraph of a business letter introduces the subject. The second paragraph deals with the purpose of the letter. The concluding paragraph expresses gratitude especially if the sender seeks any kind of favour. The letter should be brief, precise and politic.

Writing Formal Letters – CA Foundation BCR Notes

The Layout of A Business Letter (Structure):
Good layout is essential for an effective letter. An attractive appearance, good quality stationery and careful drafting help to make letters effective.

The various parts of a business letter are as follows:

  • Heading
  • Date
  • Reference number
  • Inside address
  • Salutation
  • Body of the letter
  • Complimentary close
  • Signature
  • Identification marks
  • Enclosures
  • Copy distribution
  • Postscript

1. Heading:
The heading contains the name, address, telephone number, telex number, fax number, E-mail address of the firm. Most business firms use printed letterheads for correspondence. The letterhead contains all the above information. Unless it is clear from the name of the firm, the nature of its business should also be indicated. Generally, the name and address are printed on the top middle of the page and other information is given in the margins.
Telephone:                                                                                                                       Fax:
Telegram:                                                                                                                    E-mail:

Super Fine Textiles Ltd.
1, Nariman Point, Mumbai-400001

In the above heading, the firm’s name indicates its business and, therefore, the nature of business is not mentioned separately.
Telephone:                                                                                                                   Fax:
Telegram:                                                                                                                E-mail:
Messrs Ram Aggarwal & Sons Wholesale Grain Merchants
7, Naya Bazar, Delhi-110006
In the above heading, nature of business is mentioned separately because it is not clear from the firm’s name.

2. Date:
Every business letter must carry the date. It enables quick reference in future and helps in prompt action and orderly filing. Date may become a material fact in a suit filed in a court of law. The date consists of the day, month and year. Some letterheads contain a printed line indicating where the date should be typed.

The date should be typed two spaces below the last line of the heading for a better look The date should be typed in the right-hand corner. Names of the month and the year should be written in full and no suffix such as ‘st’ or ‘th’ (31st or 7th) should be added to the day.
Use it
31 January, 2002
January 31, 2002
Avoid it
31st Jan., 2002
31st January,’02

3. Reference:
The reference helps to link correspondence for prompt reply and quick action. It serves to identify the department or section from which the letter is being sent or the particular file in which copy of the letter is to be found. Replies to the letter can be sent to the proper official. Generally, reference is typed on the left margin.
Reference: 7/MA/02
In the above reference, 7’ denotes the number of the letter, MA denotes that the letter has originated from the marketing department and 02 stands for the year 2002.
Some firms indicate the reference number and date of the letter in the main body: “Thank you for your letter No. 7/MA/02 of January 31, 2002”
Some letterheads contain two lines for references.
Your reference ………………..
Our reference …………………
The second method is preferable as it enables quick filing and saves time.

4. Inside Address:
It contains the name and full address of the firm or the individual to whom the letter is written. It facilitates filing and helps the despatch clerk to write the same address on the envelope. Inside address should be written two spaces below the reference. Special care should be taken to spell the addressees name correctly.
Superfine Textiles Limited
1, Nariman Point, Mumbai – 400001
When addressing individuals Mr./Mrs./Ms. or other appropriate prefix should be used. Mr./ Shri is used for both married and unmarried men. Mrs./Shrimati is used for a married woman. Miss is used for an unmarried woman, while Ms. can be used both for married and unmar¬ried women. Titles of rank such as Professor, Dr., Sir, should be used wherever appropriate. Where a firms’ name contains a personal name, Messrs should be used :
Messrs Ram Aggarwal & Sons
7, Naya Bazar, Delhi – 110006
When you wish to direct the letter to a particular official ‘an attention line’ two spaces below the inside address should be given :
Messrs Ram Aggarwal & Sons
7, Naya Bazar, Delhi-110006
Attention: The Sales Manager
Attention: Mr. M.L. Aggarwal

5. Salutation:
The salutation is the greeting of the addressee. It is the written equivalent of ‘Hello’ used in conversation. It should be written two spaces below the inside address. While addressing an individual ‘Dear Sir/Dear Madam’ is desirable.

When the letter writer enjoys a close relation with the addressee, ‘My dear/Dear Mr./Dear’ may be used before the surname of the addressee. When the addressee is a plural or a firm, ‘Dear sirs/Dear Medams’ is used. In official and formal correspondence, Sir/Madam should be used.
Dear Sir/Dear Madam
Dear Sirs/Dear Mesdames
For business correspondence
For saluting firms
For official correspondence
For informal letters
In some cases, the subject of the letter is also mentioned before salutations. The purpose of the subject line is to let the reader know immediately what the letter is about. Like attention line and reference it saves time.
Dear Sirs
Subject: Payment of Bill No. M/107 of 5 July, 2002.

6. Body of the Letter:
This part contains the message which the letter is to convey so as to produce a suitable response. The material in this part should be arranged and organised carefully. The body consists of the following:
(a) Subject and Reference:
First of all, a brief mention of the main theme of the letter is given. This helps to link up the correspondence and adds to the clarity of the letter. Reference in the body of the letter is the reference number of the letter in reply to which the letter is being written or the number of the previous letter already sent to the addressee. Subject and reference need not be given in the body of the letter if the same has already been given before salutation.

(b) Opening paragraph:
This paragraph is designed to attract the reader’s attention and make him go through the whole letter with interest and concentration. The letter should open with acknowledgement or gratitude, or with a reference to the action taken on the reader’s previous letter. The ‘you’ approach should be adopted to make a good impression.
Writing Formal Letters – CA Foundation BCR Notes IMG 1

(c) Main Paragraph:
This paragraph contains the subject-matter of the letter. It should contain all the relevant details but should be brief and precise. It should be written in simple and clear words so that the reader can understand them easily without any ambiguity in his mind.

(d) Closing paragraph:
In this paragraph the letter writer should state the action expected of the reader. It should be friendly but firm so as to motivate the reader. An offer or a request may be made in the closing paragraph. A positive approach and a friendly attitude should be used throughout the body of the letter.

7. Complimentary Close:
The complimentary close is a polite way of ending a letter like a courteous leave-taking or ‘good-bye’. Complementary close should correspond with the salutation as shown below:
Writing Formal Letters – CA Foundation BCR Notes IMG 2
The complimentary close is usually given below the closing paragraph of the body of the letter at the right corner. Only the first letter of the close is capitalised. Participial closure (“Thanking you”, “Hoping to hear from you soon”, etc.) should be avoided.

8. Signature:
Signature lends authenticity to the letter and without signature, a letter has no value at all. Signature is placed below the complimentary close. The name of the person signing the letter is typed below the signature. A few forms of signature. A few forms of signature are given below:
Writing Formal Letters – CA Foundation BCR Notes IMG 3
Women should indicate their marital status as shown below. This will ensure correct salutation in replay to their letter.

Yours faithfully
Miss Shilpa Ghosh
Sales Manager
Yours faithfully
Mrs. Shilpa Gupta
Accounts Manager

9. Identification Marks:
In this part initials of the person dictating the letter and of the person typing are given on the left hand margin. These initials are helpful in fixing the responsibility for dictating and typing the letter. The initials may be put in any one of the following ways:

  • CBG/ OPA – CBG-opa

CBG are the initials of the person who dictated the letter and OPA are the initials of the person who typed the letter.

10. Enclosures:
In some cases, important documents such as invoice, railway receipt, cheque/ draft, prospectus, catalogue, price list, etc. are attached with the letter. In such cases a mention of these enclosures should be made in the letter. Generally the abbreviation “Enel.” is typed after the signature and on the left margin against which the number of enclosures is mentioned.
Enel.: Two
1. Cheque No ……………. dated …………….
2. Railway Receipt No ……………. dated …………….
3. Agreement dated …………….
This helps the despatch clerk to ensure that the enclosures as mentioned in the letter are ac¬tually attached. It also reminds the receipt clerk to be careful in taking out all the enclosures to the letter before throwing away the envelope.

Writing Formal Letters – CA Foundation BCR Notes

11. Copy Distribution:
If copies of the letter are to be sent to persons other than the addressee, names of these persons are typed below the enclosure notation as shown below :

  • Mr. R.B. Chatterjee
  • Miss Anuradha

The names may be arranged in order of importance or alphabetically. If you do not want the addressee to know that copies of the letter are being sent to other persons, you should type the names of other persons on the copy only.

12. Postscript:
When the writer forgets to include ‘something important in the body of the letter, he can add the message in this part as follows:
PS. Please remember this special low price offer is valid till December 31.
Writing a postscript is not a good practice and should preferably be avoided in a good busi¬ness letter. However, it may be used to add a brief personal message or to emphasise a point already made in the letter.

Forms of A Business Letter (Style):
Form of a letter refers to the layout or style of the different parts of a letter. Several forms are used for writing business letters. Choice of a particular form depends on individual taste and preference. You should choose the form that best suits your business. The various forms used in business letters are given below:
1. The Indented Form:
This is perhaps the oldest form of a business letter. In this form, the date line is on the top right-hand corner below the heading. The inside address is in block forms. The first line of every paragraph starts two to four spaces from the left-hand margin. Subsequent lines in each paragraph begin from the left margin. Each new part is indented two to four spaces. In this form closed punctuation (comma, full stop after each part of the letter) is used. This form is pleasing but more time is required in typing it. A specimen of the indented form is given below :

Gupta Enterprises
7, Barakhamba Road
New Delhi-110001

June 7, 2002

Messrs Ashoka Garments,
11, Gandhi Market, Jind-270001
Dear Sirs,
Please refer to your letter No. A/21 of May 20, 2002.
We are glad to know that our terms and conditions are acceptable to you. You will always receive prompt and efficient service as a valuable client. You are requested to send your orders. Our catalogue is enclosed herewith.

Yours faithfully,
M.L. Gupta
Sales Manager

2. The Full Block Form:
In this form all parts of the letter are aligned with the left margin except the heading which is printed in the middle. Open punctuation (no commas and full stops except in the body of the letter) is used in this form. No typing adjustments are required because everything begins at the left margin. This saves time and energy. This form is popular due to its pleasant and informal look. However, some correspondents do not like it as it appears heavy and imbalanced on the left side. A specimen of this form is given below :

Company letter head
Name and address already printed
Telegram, cable, telex, telephones, fax

Ref No.
Inside Address
Attention line
Subject line _________________
Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxx.
Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx.
Closing/Subscription Signature
Signatory’s typed name
Signatory’s position in the company
Company name Enel.
Ref. Initials.

Gupta Enterprises
7, Barakhamba Road,
New Delhi-110001

June 7, 2002
Messrs Ashoka Garments,
11, Gandhi Market, Jind-270001
Dear Sirs,
Thank you for your letter No. A/21 of May 20, 2002.
We are glad to know that our terms and conditions are acceptable to you. We assure you of prompt and accurate service.
You are requested to send your orders. Our catalogue is enclosed herewith for your perusal. Yours faithfully,
M.L. Gupta
Sales Manager
Enel. One

3. The Modified Block Form:
In this form the date, the complimentary close and the signature are aligned with the right margin. All the parts except the letterhead are aligned with the left margin. Parts and paragraph in the body of the letter are divided by double spacing. Within each part and paragraph single spacing is used. Open punctuation is used. This form saves time as very little typing adjustments are required. This is a very modern and popular form. A specimen of this form is given below :

Company letter head
Name and address already printed
Telegram, cable, telex, telephones, fax


Ref. No.
Inside Address
Attention line Salutation
Subject line (optional)
Xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx xxxxxxxxxxxxxxxxxxx.

Signatory’s typed name
Signatory’s position in the company
Company name

Ref. Initials.

Gupta Enterprises
7, Barakhamba Road
New Delhi-110001

June 7, 2002

Messrs Ashoka Garments,
11, Gandhi Market,
Dear Sirs, ,
Thank you for your letter No. A/21 of May 20, 2002.
We are glad to know that our terms and conditions are acceptable to you. We assure you of our prompt and accurate service.
You are requested to send your orders. Our catalogue is enclosed herewith.

Yours faithfully
M.L. Gupta
Sales Manager

Enel. One

4. The Semi-block Form:
This is a combination of the indented and block forms. The indented form is used in the body of the letter whereas the inside address and complimentary close are written in block forms. The date is put below the heading and on the right margin. The date and the year are indicated in numerals and the month is written in full. Each paragraph in the body of the letter is indented three spaces. In this form, mixed punctuation is used. Some experts believe that it is easier to read this form because one is used to seeing this style in print. A specimen of this form is given below:

Company letter head
Name and address already printed
Telegram, cable, telex, telephones, fax

Ref. No.
Name and address of person to whom the letter is going
For me attention of …………….
Subject heading-not obligatory, but often used

Signatory’s typed name
Signatory’s position in the company
Company name

Ref. Initials.

Gupta Enterprises
7, Barakhamba Road
New Delhi-110001

June 7, 2002

Messrs Ashoka Garments,
11, Gandhi Market,
Dear Sirs,
Please refer to your letter No. A. 21 of May 20, 2002.
We are glad to know that our terms and conditions are acceptable to you. We assure you of our prompt and accurate service.
You are requested to send your orders. Our catalogue is enclosed herewith.

Yours faithfully
M.L. Gupta
Sales Manager

Enel. One

Writing Formal Letters – CA Foundation BCR Notes

5. The Hanging Indented Form:
In this form, the first line of each paragraph is aligned with the left margin whereas all other lines are indented four or five spaces. The complimentary close is indented but inside address, signature or title are in block form. This form can catch attention quickly due to its unusual appearance. But it may have a distracting effect by focusing the reader’s attention on the form rather than on the message of the letter.

Considerable time and effort are involved in typing due to irregular placing and adjustments. This form is not very popular in business letters. Generally, mixed punctuation is used in this form. A specimen of this form is given below :

Gupta Enterprises
7, Barakhamba Road
New Delhi-110001

June 7, 2002

Messrs Ashoka Garments,
11, Gandhi Market,
Jind-270001 Dear Sirs,
We are launching our readymade shirts under the brand name SUPER SHIRTS next month. These shirts are made from imported cotton on computerised machines. These are the results of our collaboration with SPEARS of France. These shirts are available in ten colours in plain, stripes and checks.

You are our long-standing and valuable stockists. Therefore, we offer you the agency for these shirts on our earlier terms and conditions.
In case you are interested in this offer, please reply within three weeks.

Yours faithfully
M.L. Gupta
Sales Manager

Direct And Indirect Styles:
Writing in direct style is useful in most of business letters. It is easier to write and therefore saves the time of the letter writer. It also saves the reader’s time because it presents the message concisely and quickly.

Direct style is advisable for good news messages because such messages do not face resistance from the reader. The style is also appropriate for neutral messages (neither good nor bad news). Such letters require little or no explanation or permission to get action.
Direct style is appropriate in the following types of letters:
→ Letters of inquiry: Letters that ask for information are best written in direct style.

→ Letters acknowledging an order : An acknowledgement is routine when the order can be handled without any problem. Acknowledgement letters help to build goodwill. Begin directly and express appreciation for the order.

→ Claim letters : Such letters carry bad news but direct style is useful due to two reasons. First, the reader is likely to correct the error so as to please the customer. There is no need to persuade the reader; Secondly direct style strengthens your claim. Therefore, begin the claim with a direct statement of what went wrong. Give enough facts to justify the claim. Be careful to use words that do not show anger or distrust. Lastly, state what you want done. Your closing words should also show a cordial attitude.

→ Adjustment letters : The good news in such letters justifies a direct approach. Use positive words, stress correcting the wrong not the wrong itself. Try to regain lost confidence by starting, the corrective action. End the letter with a pleasant and positive comment.

→ Order letters : Begin orders directly. Identify the ordered goods clearly and in a logical sequence. Mention the quantity needed and then describe the items in this order, close with friendly words.

Indirect Style:
This style is appropriate in the case of:
Bad News Letters: When a request is rejected or some other bad news is to be conveyed, indirect approach is suitable as some explanation is required to prepare the reader for the bad news. It cushions the shock and helps to maintain goodwill.

However, when the bad news is routine or the reader prefers frankness direct approach may be used. For example, when you refuse a request (e.g. for adjustment, credit, etc.) you need to explain and justify refusal. You have to convince the reader that the answer is fair and reasonable. In case you being with no, you put the reader in a negative frame of mind. An unhappy reader would not be in the mood to read your explanation.

Strategies For Writing Bad News Letters:
Great care is required in writing bad newsletters along with good news. Bad news stands out and is likely to receive more attention. Therefore downplay the bad news and highlight the good news. The little extra things you do for the reader will build goodwill.
→ Think through the situation and identity the best explanation, view the situation from the reader’s viewpoint. Work out a plan that will make the reader accept your decision as fair and logical.

→ Do not hide behind the company policy. Justify the refusal in terms of benefits to the reader. For example, refusing to accept returns of goods bought on sale, can be justified by mentioning the low price on sale.

→ In case the reader is clearly wrong, appeal to a sense of fair play.

→ Begin with some comment that meets the reader on neutral ground. It should closely pertain to the reader’s request. For example, while refusing a request by an NGO for donation, you may begin. “Your organization is doing a commendable job of educating the under privileged children. It deserves the help of those who are in a position to contribute”.

→ State the reasons behind the refusal. Avoid negative words that may offend a sensitive reader. Adopt the you viewpoint.

→ The refusal should flow logically from the reasoning. Do not emphasise the refusal. Say it quickly, clearly and positively.

→ End with a pleasant comment.

Writing Formal Letters – CA Foundation BCR Notes

Request Letters:
Meaning and Purpose:
A request letter is a letter that contains a request for something, e.g.; to supply goods, to provide information, to grant credit, to claim adjustment. Request letters should be written in a cordial and friendly style. Begin the letter with the request, provide justification for your request, and close with an appeal for a specific action indicating the deadline, if any. In case you request several items or pose several questions, number them clearly.

Request letters may be written for the following purposes :

  • to make sales enquiries
  • to place orders
  • to obtain necessary information
  • to grant credit
  • to claim adjustments.

Structure of a Request Letter:
The main parts of a request letter are as follows :
1. Beginning:
Begin the request letter with a direct statement of the request. First of all, state what you want and then explain your initial request. The tone of your request should be courteous and positive e.g. ‘please’, “I would appreciate”. An impatient demand or demanding an immediate action (“send me your catalogue”) is not likely to get a favourable response. The general rule in a direct request is: “write not only to be understood but also to avoid being misunderstood.”

If for example, you request a catalogue from some publisher, specify whether you want a general catalogue or a specialised catalogue of books on business communication. According to Edwin Newman, “When writing direct requests get directly and clearly to the point by eliminating boastful complicated vocabulary and words that impress or conceal.” You may begin with a question as it gets quick attention.

2. Middle part:
In the middle section of a request letter, give justification and explanation for your request. State how the reader will benefit by granting your request. For example, the owner of an export house might write to an European buyer “We supply the best quality tea produced in India”. Adopt ‘you’ attitude in your letter. State the most important question first.

The more specific and related questions may be put afterwards. Ask only the relevant questions which are central to your main request. Explain enough to enable the reader to another. If your request relates to some defective product specify the model number, date and place of purchase, the exact defect in the product.

3. The end:
In the last part of a request letter, specify the action you want and the time limit for the action. Close the letter in a courteous and friendly tone. Various types of request letters are given below: Letters of enquiry, requests for quotations and replies are an important part of business correspondence.

Request Letters for Enquiry:
Whenever a buyer wants to get some information about the quantity, price, availability, etc. of goods to be purchased, or about the terms of sale, etc., he writes a letter of enquiry to the seller. Letters of enquiry are, therefore, information seeking letters.

They are of the following types :

  • Solicited Enquiry : An enquiry made in response to the seller’s advertisement and publicity.
  • Unsolicited Enquiry : An enquiry made at the buyer’s own initiative.
  • Routine Enquiry : An enquiry made by an old buyer in the usual course of business.
  • Enquiry for some favour : An enquiry for some favour like some special price, relaxation of terms and conditions etc.

A letter of enquiry should be:

  • brief and to the point
  • clean, complete and correct
  • positive and confident in tone
  • straight forward but courteous.

Letters of enquiry are sent by an organisation or an individual to enquire about price, discount, quantity, availability of goods, etc from the seller. They may be categorized as follows:

  • An enquiry made at the buyer’s initiative or unsolicited enquiry
  • An enquiry made in response to sellers offer/advertisement or solicited enquiry
  • A routine enquiry made by an old buyer in the usual course of business.
  • An enquiry for some favour like some special price, relaxation of terms and conditions etc.

Hints for Drafting a Letter of Enquiry:

  • State the purpose of your letter, whether you need goods, services or information.
  • Indicate to the seller how you got his name – from an advertisement or someone’s recommendation.
  • State the details of your business.
  • Give an idea of the quantity you need so that the supplier may quote the best possible price.
  • Request for price list, quotation, etc.
  • Ask for samples or demonstration, wherever necessary.
  • Ask for terms concerning discount, credit, mode of deliver, packing, etc.
  • Give reasons for any concession you are asking for-large order, cash payment, etc.
  • Avoid apologies example – “we beg you to send”.
  • Avoid unnecessary details and repetition.

Replies to Enquiry:
All replies must be sent at the earliest. An early reply reflects business etiquette and genuine respect for the buyer. Replies should contain complete information about prices, discount, credit, delivery, etc. Price lists and quotations may be enclosed with the reply or may be sent separately. In both the cases a reference about them should be given in the letter of reply.

Hints for Drafting Replies:

  • Refer to the date and/or number of the enquiry.
  • Thank the buyer for his letter and show appreciation for his interest in your firm, its products or services.
  • Answer all the questions given in the letter of enquiry.
  • State the terms of sale in clear and concise language.
  • Mention the time period for which the offer is open.
  • State whether the price list/catalogue is enclosed or is being sent separately.
  • Use some sales talk to stimulate the interest of the buyer.
  • Show your willingness to help the customer in the form of additional information, if required.

A few samples of letters of enquiry and replies are given below:
Example 1:
Write a letter requesting a Stationery supplier to send their price list and catalogue.

Fine Stationery Mart
71 D, Kamla Nagar, Delhi-110007

10 January, 2002

Messrs Neelgagan Stationery Co.
10, Park Street, Kolkata
Dear Sirs,
We are interested in making bulk purchases of stationery.
Kindly send us your latest price list and catalogue.

Yours faithfully
Shive Kumar

Example 2:
Reply to the above enquiry.

Neelgagan Stationery Co.
10, Park Street, Kolkata

13 January, 2002

M/s Fine Stationery Mart
71 D, Kamla Nagar,
Dear Sir,
Thank you for your enquiry of 10th January. We are glad to enclose our latest price list and illustrated catalogue.
Our stationery is made of high quality paper.
Our normal trade discount is 15% and 5% extra for bulk orders exceeding ₹ 50,000.
If you need any further details or assistance in meeting your special requirements, kindly feel free to write to us.
Yours faithfully
For Ncclgagan Stationery Co. v.
M.N. Kapoor Sales Manager
Enel.: 1. Price List
2. Catalogue

Example 3.
Write A letter to Star Sports enquiring’the prices, terms of sale, etc. with reference to their advertisement in the Hindustan Times.

Modern Traders
10, New Market, Meerut (UP.)

10 February, 2002
Star Sports Ltd.
21, Andheri (W)
Dear Sirs,
We read with interest your advertisement in the Hindustan Times dated 7 February, 2002 and are impressed by the description of sports goods made by you.

We are leading dealers in sports goods in this area. The demand for sports goods is steadily increasing in this region and we have a large number of enquiries and orders for them.

Kindly send us your catalogue and price list for wholesale purchases. Since our annual requirements in sports goods of all kinds exceed ₹ 5 lakhs, we would like to place regular orders with you. Hence, please quote your most favourable prices and terms.

Yours faithfully
R.K. Singhal

Writing Formal Letters – CA Foundation BCR Notes

Example 4:
Reply to the Above.

Star Sports LTD.
21, Andheri (W), Mumbai-400001

15 February, 2002

Modern Traders
10, New Market,
Meerut (UP.)
Dear Sirs,
Thanks for your enquiry of 10 February, 2002. We are glad to know that you are impressed by our advertisement in‘The Hindustan Times’.
You will be glad to know that our sports goods are approved by the BIS. Therefore, your customers have an assurance that they are using the finest items now available in the market and are getting the maximum value for their money.
The enclosed catalogue will give you all the necessary details about the sports goods that you might be needing. You will find our prices-F.O.R. anywhere in India-very competitive. In view of the large business promised, you will also get a special trade discount of 5 per cent on all orders and an additional 5 per cent on all orders exceeding ₹ 25,000.
We assure you of our immediate attention to your orders.

Yours faithfully
S.K. Tayal
Sales Manager

Enel.: One

Example 5:
You have received quotations for electrical goods from Bharat Electricals Ltd. but you find that their terms of 5% trade discount and 30 days’ credit are not competitive compared to quotations from others. Write a letter asking them to offer you better terms.

Sharp Electric Stores
Hospital Road, Agra

1 March, 2002

The Sales Manager
Bharat Electrical Ltd.
Colaba, Mumbai.
Dear Sir,
Re.: Your quotation of 25th February
Thank you for your letter of 25th February along with your quotations and catalogue.
A few other reputed firms from Mumbai have offered 7% trade discount and 2% cash discount for 30 days.
it would be competitive and hence justifiable if you allow us an additional trade discount of 3S or 3°ti cash discount for 30 days apart from the above 5’*o trade discount you have already offered. In view of the present large order of ₹ 75,000 and the subsequent orders’ you would be regularly getting from us, you should still find these terms attractive.
These goods are needed to execute customers’ urgent orders. Hence we look forward to getting a prompt reply from you.

Yours faithfully
Krishan Lai

Example 6:
Reply to the above

Bharat Electricals LTD.
Colaba. Mumbai-400001

5 March, 2002

Dear Sir,
Many thanks for your letter of 1st March. We really appreciate your interest in our products and your order for them.
May we point out to you that our quotations contained minimum prices taking into account the variety and quality of the. goods. Moreover, our c.i.f. prices give you an additional benefit. The extra cost of packing required for the goods you have ordered leave us only a thin margin of profit.
However, we shall be glad to allow you the requested additional 3% discount if you can raise your order to ₹ 1,00.000 worth of goods.
We await your confirmation and additional order.

Yours faithfully
P.K. Garg
Sales Manager

Example 7:
Letter of Enquiry

ABC Hostel
Knowledge Park II.
Greater Noida – 201308

Dale : 17 August, 2004

Ref. No ……….
Pooja Furniture House
5, MG Road,
New Delhi-110 010
Dear Sirs,
Recently, we have constructed two hostels – one for boys and one for girls with a capacity of 200 beds each. We are now interested in purchase of necessary furniture needed to run the hostels.

Kindly sent us your latest catalogue and quotation including discounts. We will appreciate if you , can grant us some special discount offer for purchase in bulk.
Looking forward to an early reply

Thanking you,
Yours faithfully
(P. K. Sharma)
Hostel Superintendent

Reply to an Enquiry:
While replying to an enquiry, it. should be ensured that the requested information is provided, j Reply to an enquiry must be sent promptly otherwise it will reflect poor image of an organization. The letter must contain all relevant and complete information, such as prices, terms of sale, I discount rate, credit, delivery, after sale service and other terms and conditions. A catalogue or price list may either be enclosed with the letter or sent in a separate cover.

Example 8:
Reply to an Enquiry

Pooja Furniture House
5.MG Road, New Delhi-110 010

Date : 31 August, 2004

Hostel – Superintendent
ABC Hostel
Knowledge Park II
Greater Noida – 201308
Dear Sirs,
Thank you for your enquiry dated 17th Augusl, 2004. We are glad to submit the latest catalogue and price list of our furniture. Let me assure you that the furniture manufactured by us is of excellent quality.
Our normal trade discount is 20% on every item except steel Almirah on which the discount is 15%. Since you have requested for purchase in bulk therefore we can offer you a special discount of 25% on all items subject to a minimum order of ₹ 2,00,000.
If you require any other information please feel free to contact us at any time.
We Assure you of our best services,

Yours faithfully
(Ajit Singh)

Writing Formal Letters – CA Foundation BCR Notes

Request Letter for Placing Orders:
Purchase order for a product is one of the simplest kinds of request letters. Give adequate and precise information while placing orders. In case the letter contains insufficient or vague details, there will be delay in delivering and mistakes may occur in fulfilling the order. In case no response is received within a reasonable time, write or contact on phone to know the action taken by the supplier.

While writing request letters for placing orders, the following points should be covered:
→ Complete details of the goods ordered : Give a complete and clear description of the goods in terms of name of the goods, type of goods, their size, prices, method of packing and so on.

→ Details regarding quality: The specific quality of goods and their quantity must be mentioned.

→ Mode of transportation :The mode of transportation e.g. goods train, truck, air, shipping, post or courier service to be used must be specified.

→ Reference to quotations : The quotations of the supplier must be referred to so as to justify that the order is in accordance with the terms and conditions given in the quotations.

→ Conditions of sales : Specify the catalogue, specimen or advertisement on which the order is based.

→ Date and mode of payment: Mention when and how the payment will be made e.g. in cash or in instalments, bank draft or after documents are received through the bank.

Example 9:
Specimen of request letter for order

New Book Stork
11, Nai Sarak, Delhi

Telephone: 011 – 23212321
lax: 011 – 23210101
April 2, 2007

Mayur Paperbacks
Dear Sir,
Please deliver the following books by road to the above address by April 9, 2006.
1. Business Organisation & Management by C.B. Gupta, 4th Edition, 2007                                           50 copies
2. Business Organisation & Management (Hindi) by C.B. Gupta, Second Edition, 2007                         30 copies
3. Personality Development and Communication Skills-1 by C.B. Gupta, First Edition, 2007                  40 copies
4. Personality Development and Communication Skills-II by C.B. Gupta, First Edition, 2007                  60 copies
Please pack the books in a carton. The books are to be invoiced at the usual trade discount of 20 percent which you have granted us always.
The cheque will be handed over to your delivery person on receipt of the books.
Deepak Goel

Hints For Drafting An Order
→ Thank the supplier for his quotation, especially if he has offered special terms.

→ Give details about the goods required:

  • exact trade name, catalogue number, size, design, colour, style, quality, etc.
  • quantity desired of each item
  • price and discount of each item

→ Give instructions regarding :

  • packing and marking
  • insurance
  • shipment-truck, train, ship. etc.

→ Stale the mode of payment:

  • debit to account
  • cash sent with order (C.W.O.)
  • cash to be paid on delivery (COD)
  • invoice to be sent through a bank
  • bill to be drawn by the seller.

→ Close with desired emphasis e.g., time factor, quality, discount., etc.

Writing Formal Letters – CA Foundation BCR Notes IMG 4

Request Letter Seeking Credit:
A business firm may make a direct request to its suppliers for sale of goods on credit. Such credit requests may also be made to manufacturers, wholesalers and banks. In a credit request, it is necessary to specify the period you have been in business, the existing accounts, name of your bank, your financial statements and references needed.

Example 12:
Letter making a credit request.
Writing Formal Letters – CA Foundation BCR Notes IMG 5
We have enjoyed a steady rise invour business since our beginning in April 2000. We are capable of paying our bills promptly, as you can see from the enclosed financial statemenis. We shall be glad to supply any more information and names of references for granting credit.
There, is steady demand for vour products. We expect to place order of the above value alter every three months. This order could mark the beginning of a profitable relationship between our firms.
Sri Niwas Garg

Refusing Credit:
Use tact in refusing as credit is personal. Use indirect approach so that the reader does not interpret the refusal as a personal reflection. Being nice to people is personally gratifying to all. It also helps in gaining future customers.

  • Begin by developing a refusal strategy
  • Do not bluntly tell your refusal
  • Do not promise any future extension of credit
  • In ease the applicant’s financial position is weak, you can be frank.
  • You may thank for the request
  • Give explanation for a bad moral risk, it tan be vague and it can be more open for one in a financial
  • A positively worded refusal is the best in ease the applicant’s finances are weak.
  • End with friendly words that fit the situation.

Request Letter Seeking Information:
In a letter requesting some routine information or action, state what you want and why it is in the interest of the reader to help you. Such a direct request is likely to be granted provided the reader is able and willing to help you. Use specific details and polite tone to get a positive response. Vague words and impolite tone can cause embarrassment and negative feelings. You must be tactful while drafting such a request.

Example 13:

North City Mall
Netaji Subhash Palace, Pitarripura, Delhi-110034

May 15, 2007

The Manager
LG Electronics
7, Nehru Place, New Delhi
Dear Sir,
We are interested to know whether you have on ready stock of fifty split air conditioners. In addition, we also need ten high speed computers with printers for our staff. Kindly instruct your sales representative to bring with him the booklet of various types of air-conditioners and computers. After inspection and demonstration, we shall be in a position to decide and place orders.

Dheeraj Sharina
Purchase Manager

Writing Formal Letters – CA Foundation BCR Notes

Requests to Customers and Clients:
Business firms often request their customers and clients to provide some information. Such requests tend to be simple and short. For example, Maruti Udyog and its dealers request their clients to write their experience with newly purchased cars. Such letters provide the buyers an opportunity to share their views on the products. The company receives valuable feedback for making necessary improvements in products and policies.

Example 14:

Maruti Udyog
Udyog Vihar, Gurgaon (Haryana)

21 December, 2006

Deal- Madam,
We are grateful to you for the confidence you have shown in our products. We are sure you must be happy with your Esteem car which you purchased from Rana Motors on 14th December, 2006. We request you to spare a few minutes and fill in the enclosed feedback form so that we may be able to serve our customers even better.
Remember, Ms. Shipra. you can always count on us when you and your friends or relatives want to buy a new car.
Do give us the opportunity to serve you in future.

Roshan Yada
Sales Manager

Persuasive Letters:
Persuasive messages are designed to change the mindset of readers and to overcome their resistance. Therefore, such messages are generally written in the indirect order. It is necessary to present facts and give logical reasons that can convince the reader. Requests that are likely to face resistance require a slow and deliberate approach.

Persuasion requires much more than simply asking someone to do something. It involves changing the attitudes of people and influencing their actions. Before writing a persuasive letter, you must know what you are writing about, to whom you are writing to and what action you want from your readers. Persuasive requests require a slow moving approach. Money rewards personal benefits and other appeals may be made.

Purposes of Persuasive Letters:
Persuasive letters are written to serve the following purposes:

  • to overcome the objections which might prevent or delay the desired action
  • to provide adequate information so that the reader knows what to do
  • to obtain the desired result
  • to build a positive image of the writer/writer’s organisation.

How to Write Persuasive Letters:
The main steps involved in writing persuasive letters are as follows:
1. Plan the persuasion:
Develop the persuasion strategy that will overcome-the readers objections. Imagination is required to design a plan that will convince the reader. Determine the reader’s objections by putting yourself in your reader’s shoes. Then think about what you can say to overcome these objections.

The specific plan to be used will depend upon the situation. You may state how your reader will gain in time, money or prestige. In other cases you may persuade the reader by appealing to his love of beauty, excitement, doing good and so on.

2. Gain attention in the opening:
Persuasive requests and sales messages are uninvited and are therefore likely to face resistance from the reader. The first part of a persuasive letter must be able to attract the attention of the reader. Attention is needed to get the reader in a mood to receive the persuasion. An interesting beginning can gain the readers attention.

Imagination is also necessary to determine what will gain the readers attention. It might be some statement that offers a benefit or a question that arouses mental activity. The opening should act as a buffer for the request that follows. The following examples can be helpful. For a persuasive message seeking the cooperation of businessmen in promoting a fair,

“What would your profits be if 10,00,000 free-spending visitors came to our city during a single week”.
For a persuasive message requesting donation of eyes “After your death you can make a person see the world through your eyes”.

3. Present the persuasion:
The reasons you have selected need to be presented in a logical and orderly manner. Merely listing the points is not enough. You should communicate the points with convincing words. You-view-point and clear expression will help to penetrate the neutral or resistant mind of the reader. Your words should travel rapidly so that the reader does not get impatient.

4. Make the request clearly and positively:
Once you have prepared the reader well for what you want, the reader may be ready to accept your proposal. Present your proposal in proper words and positive tone.

Look at the following examples:
“We are aware that many people oppose mutation of dead bodies on religious and emotional grounds but we hope you will not mind if your eyes after your death can serve others” (Negative avoid it) “Last year 1000 people donated their eyes. We are sure you will like to be among, such noble souls by donating your eyes”. (Positive, use it.) Your request may end with the message. But further explanation may be given when a long persuasion effort is needed. It is a good idea to follow your request with a reminder of the appeal.

Hints For Writing Persuasive Messages

  • Decide the strategy.
  • Open with words that gain attention.
  • Present the message using persuasive language and you-approach.
  • Make the request clearly.
  • Use positive language and remind the appeal.

Writing Formal Letters – CA Foundation BCR Notes IMG 6In the above letter, an executive is requested to spare time and effort and provide information for an article in a business magazine.

Foundation of Persuasive Letters:
Convincing an uninterested reader to take some action is indeed a very difficult task. Psychologists have carried out considerable research to identify the factors that help to overcome the resistance to a persuasive message and to motivate the people to change their beliefs and actions. These factors are called the foundation of persuasive letters. Thill and Bovee have suggested the following factors:
1. Needs and appeals:
Appeal to the unsatisfied needs of the reader is an important strategy that can elicit the desired response to a persuasive message. Since the needs of the readers differ they respond to a particular message in different ways. In order to understand human needs and design message that appeal to these needs, you must analyse and understand your readers.

2. Emotions and logic:
Emotions and logic are powerful means of persuasion. There are always some emotions or logic behind the attitudes of people. While writing persuasive messages, appeal to the emotions and give logical arguments.

3. Credibility:
Objective and specific proof of your message helps to enhance your credibility. Support your message with testimonials, guarantees, research studies and other solid facts.

Following characteristics also make your message credible:

  • Enthusiasm: Which means excitement about the subject of your message.
  • Sincerity: Which refers to genuineness and good faith.
  • Trust worthiness: Which stands for truth and honesty.
  • Expertise: Which implies knowledge of the subject.
  • Objectivity : Which means understanding of and willingness to see both sides of an issue.
  • Similarity : Which includes attitudes and beliefs shared with the audience.
  • Good intentions: Which implies care for the best interests of readers.

4. Appropriate words: The words used in a persuasive message must be respectful and effective. Persuasive letters are of several types. Sales letters and collection letters are the most important types of persuasive letters.

Writing Formal Letters – CA Foundation BCR Notes

Sales Letters:
In the highly competitive business of today, publicity and advertisement have become essential for every business enterprise. Sales letters are one form of advertising. These letters enable a businessman to approach present and potential customers easily and at low cost. As a sales letter is directly addressed to a select group of customers it has a particular appeal and a personal touch. Sales letters are particularly useful in direct selling by mail. Thus, sales letters are the letters written for selling goods and services. Sales writing is not ordinary writing.

Objectives of Sales Letters:
Sales letters are written to achieve the following objectives:

  • To promote the sales of a product, a service or an idea.
  • To introduce new products in the market quickly, effectively and at a low cost.
  • To introduce the salesman to the potential customer.
  • To widen the market for existing products.
  • To remind the customer about the product or service.
  • To educate customers in better understanding of products and services and in selecting the right type of goods.
  • To create and maintain the firms goodwill among the customers.
  • To secure orders for a mail order business house.
  • To serve as a silent salesman wherever a salesman cannot reach the customers.
  • To keep the customers in regular touch with the company and its products and services.

Elements of a Good Sales Letter:
A good sales letter must contain the following features :

  • It should be appealing and persuasive.
  • It should be attractive.
  • It should be creative in nature.
  • It should be complete, explain the product or service in detail.
  • A brochure/pamphlet, etc. may be attached with it.
  • Use the right-appeal and you view point.

In order to write good sales letters, the writer should have thorough knowledge of the product/ service to be sold, the potential customer and the proposition which comprises prices, warranties, terms and conditions of sale. The writer should fully understand the wants and problems of the customer.

A great deal of imagination is required to write good sales letters. A suitable emotion or rational appeal that fits the product and the prospect should be used. The best appeal depends on the prospects’ uses of the product. Emotional appeals touch the heart. Rational appeals stress facts and logic.

Functions of Sales Letters-AIDA Strategy:
A sales letters is expected to perform the following functions :

1. Attracting Attention (A)
2. Arousing Interest (I)
3. Creating Desire (D)
4. Securing Action (A)

This is known as the AIDA strategy.
1. Attracting attention: A sales letter is an uninvited guest. It must attract the reader’s attention through its physical appearance-good stationery, smart letterhead, good printing, attractive envelope, etc. You- attitude, personalised approach, relevant words and brief opening are also helpful in attracting the readers attention.

The first or opening paragraph of a sales letter may begin with any of the following:

  • A sincere compliment
  • A positive comment or assertion
  • An audience friendly statement.

2. Arousing interest/curiosity: A sales letter should begin in such a way that the reader gets into the subject-matter with interest and curiosity to know its full message. The opening sentence can be designed to arouse the readers interest in the product or service by presenting the sales material.

A few methods of writing opening sentences in sales letters are given below:

  • A striking statement – Save 40% on your electricity bill.
  • A starting offer – Invest ₹ 1,000 a year in these BONDS, retire with ₹ 1,00,000 in 10 to 15 years.
  • Offering a gift – Free for your the Reader’s Digest Diary if
  • Asking or offering favour – Will you help us to help you?
  • Asking a question – Do you want to cut down your telephone bills? Explain how your message is beneficial to the reader so as to get the reader thinking.

3. Creating desire : The, exciting taste of close up.

4. Securing action : A sales letter will go waste if it fails to secure the desired action from the customer. Limited time or quantity offer, discount offers, premiums, free samples and such other techniques can be helpful in securing prompt action from the reader.

One expert said, “Make your letter so convincing that the prospect would rather have the product than the money he must part with to buy it.” A sales letter must end with a statement that urges specific action. The last part of the letter provides you a good opportunity to remind the reader of the benefit that will accrue by taking the action you want.

Give adequate information to sell. Answer all questions and overcome all objections. Coordinate the letter with the attached brochure or booklet. Let the letter carry the main sales message. Recall the appeal and urge action now.

Hints For Drafting Sales Letters:

  • Begin the letter in a manner that arouses curiosity and tempts to read.
  • Give a vivid description/explanation of the product, service or proposition being offered.
  • Tell the benefits of the product/service.
  • Convince the reader by giving evidence, testimonials, users’ experience, etc.
  • Induce the reader to act at once.
  • At the close, tell the reader exactly what to do and how to do it so that the action becomes easy.

Writing Formal Letters – CA Foundation BCR Notes

Essentials of a Successful Sales Letter:
Sales letters or offers are one of the most important written form of business communication. Their primary aim is publicity or to reach out to a large number of people interested in a particular product/ service and turn them into buyers. Even if people are not interested in the product, the aim of the letter is to make them interested in it. The requirements of an effective sales letter are as follows :

1. Study the product or service:
The first step in planning a sales letter is to study the product or service to be sold. If possible, test the product or service yourself or anothers. For example, if you want to sell a food item eat it. This will enable you to discover ideas for promoting the product or service. A thorough knowledge of the product or service is very useful for writing a sales letter. People will buy the product or service if they will benefit from its use and the price suits them. »

2. Understand your prospects : Once you are satisfied that the product or service is worthy of promotion, identify the target market to whom the sales letter should be sent. Focus on target group and use specialised information. A sales letter is essentially meant for a particular class of consumers. No product or service can be of interest to all kinds of consumers. There are products specially designed for children, for women, for school children, for body-builders and so on. A sales letter/offer for any of these items is designed and sent to this target group.

An effective sales letter is backed by specialized knowledge or at least sufficient information about the product/service offered and the needs of the consumer. In order to convince the consumer the letter must give convincing arguments in favour of the product, facts and figures comparing the product offered with its competitors, the changing needs and expectations of consumers and so on. Supplementary literature, brochures, excerpts from research findings etc. are also often supplied with the letter.

3. Interesting opening:
An effective sales letter has an attention-getting opening. It may start with a catchy subject-line, an exclamatory slogan, straight question, a rhetorical question or in whatever way the writer chooses to capture the audience. For example- “Here is a good news for you!”

4. Emotional v. rational appeals:
It is needless to say that a sales letter makes a strong appeal to the consumer/receiver of the letter. The strategies to appeal the buyer can be classified into two categories – emotional and rational Emotional appeal is directed to our senses viz., taste, smell, feeling, hearing, and seeing. These appeals include strategies to arouse love, pride, enjoyment etc. Some products or services are suitable for emotional selling.

For example, perfume, travel, exotic food, etc. Rational appeals are directed towards reason and include persuasive strategies aimed at saving making money, doing a job more efficiently and so on. The sales letter is carefully planned on the basis of the product, the needs and expectations of the consumers and how best to appeal to their heart or mind.

5. Lengthy with conversational style:
Almost all sales letters are long letters with conversational style in contrast with the other business letters that are supposed to be short and precise. A typical sales letter often runs in two or three pages as “The purpose of the letter is to persuade the reader that he needs what you are trying to sell and to get him to buy it”. The buying action is also made easier, for example by providing a prepaid envelope, discount coupons or a toll free contact number.

6. Price:
The sales letter should be mailed to the prospects only after setting the price within the range which can yield a satisfactory margin of profit.

7. Follow up:
A sales letter is the beginning in a sales promotion programme. It often has to be backed by reminders. A ‘follow-up’ letter is written with reference to something that has been done before. It follows up on the previous contact. The customer’s attention is secured by reference to the previous communication. A follow-up letter is brief because its function is to remind the customer to take action. The timing should be appropriate e.g., taking advantage of a current event. The letter usually points out that time is running out and the customer should hurry to take advantage of the limited offer.

A few examples of effective sales letters are given below :
Writing Formal Letters – CA Foundation BCR Notes IMG 7

Example 1:
A sales letter offering shirts

Super Textiles LTD.
7, Nariman Point, Mumbai-400070

September 15, 2002

Dear Patron,
Why buy the inferior when you can gel the best at the same price. Buy Super Shirts made specially from imported cotton For Only ₹ 180 per piece.
Super Textiles give you Super Value. Our shirts are stitched on the most modern computerised, machines at an exclusive price of ₹ 180. Anywhere you would pay ₹ 30 more for a similar’ shirt.

Super Shirt is a quality shirt and is offered at a popular price. It is the result of cooperative venture of Super Textiles and SPEARS of France. These shirts are available in ten colours in plain, stripes and checks.
Super Shirts are offered at exclusive price only for a Limited period. Act now and save ₹ 30.

Very truly yours
S.K. Patil
Sales Manager

Example 2:
A sales letter introducing a new life insurance policy.

March 13,2002

Dear Customer,
Whatever the dream, I he future is guaranteed.
Imagine, a third parent for your child. Someone who’ll take care of her education and other needs, even when you’re not there. So nothing can come in the way of her future, her dream. That’s ICICI Pru Smartkid. A never before policy for kids. Here is how the plan works for your child.
→ It guarantees periodic payments throughout your child’s student life.
Writing Formal Letters – CA Foundation BCR Notes IMG 8

→ In the event of your not being there.

  • It waives off all future premium payments, while the periodic payments to your child continue.
  • The sum assured is paid immediately to your family.
  • For a nominal extra premium, 10% of the sum assured gets paid to your child annually to take care of her regular living expenses.

So no matter what, you can guarantee your- child a worry-free future.

Yours truly
General Manager

Example 3:
A sales letter regarding lighting equipment

Mysore Electricals LTD.
11, Mahatma Gandhi Road, Bangalore

1st January, 2002

Mr. Rajeev Verma
1/12, Roop Nagar
Dear Mr. Verma,
What factor is more important ill your lighting equipment:
Maximum light output?
Long life?
Trouble-free service?
Minimum maintenance cost?
Mysore lighting equipment can offer you all.
Maximum light output demands that every component of the lighting equipment functions perfectly. Mysore electricals take no chance, for they manufacture all the components required for your equipment at international standards. Since Mysore lighting equipment has to undergo tests far more exacting than normal operational conditions, they are unequalled for performance and long useful life.

As a result, replacements are needed rarely and the maintenance cost is kept at the minimum. In other words, Mysore electricals give you everything you want from lighting equipment, maximum light output, long-life, trouble five service-all at a minimum maintenance cost.

Ask for MYSORE lighting equipment to ensure ultimate economy. Il is efficient and economical in operation and attractive in design. Get today Mysore lighting equipment fittings from your nearest Mysore electricals dealer.

Brighteningly yours
for Mysore Electricals Ltd.
S.P.S. Reddy
Sales Manager

Writing Formal Letters – CA Foundation BCR Notes

Collection Letters:
Collection letters are the letters which are written to customers who have not paid their bills on due dates. A collection letter is written to overdue accounts.

Accounts become overdue on account of several causes. Once in a while the bill or statement of account may be lost in the mail or may get misfiled. Some customers may find it difficult to pay in time due to an unforeseen problem. A few persons mistakenly borrow more than they can possibly repay. Still others are irresponsible about paying bills in time.

Collections letters are written to serve two purposes –

  • to collect what is due, and
  • to maintain goodwill.

These days considerable business is done on credit. But credit sometimes creates the problem of collecting the dues promptly. The collection department of a company has to write a series of letters to customers who do not make payment in time. The major problem before this department is how to collect the dues without losing customers. An undue haste in collection may drive away the customers. Similarly, negligence in collection of dues may cause loss due to bad debts and additional expenses. Therefore, the collection department has to adopt a step-by-step approach.

A good collection letter should contain the following points :

  • Awake sense of pride in the debtor.
  • Maintain relationship with the debtor.
  • Ensure sense of fair play.
  • Follow the rules.
  • Recognise mutual effort.

The collection letters are generally written in a series, each successive letter being stronger in tone than the previous one.

The various stages involved in this series are as follows :
1. Early stage or will pay stage: The assumption in this stage is that the debtor will pay and the company need only remind them. Therefore, a mild reminder is written at this stage. A copy of the unpaid bill or the statement of account is enclosed with the reminder.

The persuasive letter should be written in a polite tone assuming that the delay in payment is due to oversight. Mild reminders are generally short and sweet. The customer is reminded of the number and date of invoice and the amount overdue. It is not necessary to insist on payment.

Hints for Drafting Mild Reminders:

  • Refer to the statement of account already sent and the amount due.
  • Say that the customer has perhaps overlooked the statement or invoice sent.
  • Request for prompt payment.
  • Enclose the statement of account/invoice again.
  • Use mild and inoffensive tone.

Example 4:
A mild reminder.

Rama Stores
D-7, Kiimla Nagar, Delhi-1 10007

February 21, 2007
Goel & Sons
105. Clolh Market,
Dear Sir,
Hope that you would have liked the shirtings consigned to you last month. Their sale would prove profitable to you. A glance at your account shows that payment of these shirtings amounting to ₹ 30,500 only has not yet been received by us. Perhaps, the bill in question has escaped your attention due to pre-occupation. We are enclosing herewith a copy of the bill. Kindly attend to the enclosed bill and remit the amount to us. In case your cheque is already in the mail, please disregard this letter.
We genuinely appreciate your business and look forward to serve you better in future.
Ram Lal
Enclosed : Bill

2. Middle stage or should pay stage:
At this stage, you have to persuade the debtor to make payment. Communicate a sense of urgency without making any overt threat. First select the appeal (fair play, pride, value of credit record, etc.). Then fit it to the specific debtor. Keep the tone friendly and prudent.

When mild reminders fail to bring payment from the debtor, the supplier has to write strong reminders. This should be done in a very tactful and persuasive manner. The debtor should be made to realise the need for prompt payment without making use of offensive language. As the letter is unwelcome the opening should get attention. After the opening present the appeal, end with a clear request for payment. It is advisable to link payment with a benefit to be gained.

Hints For Drafting Strong Reminders:

  • Refer to the amount due and the time since it has been due.
  • Refer to the reminder already sent.
  • Point out, if necessary, the term of credit.
  • Request the customer to make a proper payment of the amount due.
  • Do not express doubts about the customers intention or capacity.
  • Do not use threatening words.

Example 5:
A strong reminder

Rama Stores
D-7, Kamla Kagar, Delhi-110007

No. 11/3/110
March 7, 2007
Goel & Sons
105, Cloth Market
Dear Sir,
We draw your attention to our letter dated February 21, 2007 requesting for the payment of ₹ 30,500 only at the earliest. However, we have yet to receive the same;.
We appreciate your business very much and are glad to have extended to you the benefit of a credit account.
And, we are sure, you will realise the importance of meeting your obligation of payment on or before the agreed dates.
Your account for ₹ 30,500 now two months overdue needs a cheque to avoid the unpleasant suspension of its operation.
Why not post your cheque today only, so that you continue, to enjoy your credit account?
Rain Lal

Example 6:
An alternate strong reminder.

Rama Stores
D-7, Kamla Nagar, Delhi-110007

March 7, 2007
Goel & Sons
105, Cloth Market
Dear Sir,
We invite your attention to our letter dated February 21, 2007 requesting for the payment of ₹ 30,500 only at the earliest. However, we have vet to receive the same. We are sure, your credit account with us has been of great convenience to you. However, your prompt payments are necessary in order that we continue to extend this service.

You must be aware that credit accounts lockup working capital and increase financial burden. Delay in the settlement of long standing dues brings business to a virtual stand still and all of us suffer. We earnestly wish to offer you our continued service. But we mas base to suspend operations of your account, reluctantly unless you promptly settle your account.
Please mail your cheque by return post so that you continue to keep your credit.
Hope you will comply with our request.
Ram Lal

3. Enquiry and discussion stage:
When reminders fail to bring the desired response from a delinquent customer, the supplier has to find out the reason for the delay in payment. It may be due to some mistake on the seller’s part wrong goods supplied, error in invoice etc. The debtor may also be in difficulty due to slow collections, slack business, some calamity, etc. At this stage, efforts are made to get a reply from the debtor so that necessary assistance may be offered to tide over his difficulties and payment may be received from him immediately or at a later date.

Hints For Enquiry And Discussion:

  • Refer to the amount due and the period for which it has been due.
  • Draw attention to the previous reminders.
  • State what you feel to be the reason for delay.
  • Offer assistance to tide over his difficulties-allowance for wrong goods, correction of mistake in invoice, extension of credit term, payment in instalments, etc.
  • Insist that the customer should write to you or visit your office for explaining his difficulties.

Example 7:
Enquiry and discussion – 1

Rama Stores
D-7. kamla Nagar, Dclhi-110007

March 27, 2007
Goel & Sons
105, Cloth Market
Dear Sir,
We are at a loss to understand why we have not heard from you regarding your above account vvhiclt is two months due.
None of our reminders sent on February 21 and March 7 has brought in either your remittance or your reply.
We still value your business and are eager to serve you through your credit account. But it certainly depends on your prompt payments which are entirely your responsibility. If a personal discussion can help you line a solution, please call on us and talk to me. Or just drop a letter and our representative will be at your service.

Our experience tells us that whenever someone lags behind in settling his account, he finds it doubly difficult to catch up. Therefore, in your own interest mail to us right now a cheque against this delinquent account of ₹ 30,500.
Ram Lal

Writing Formal Letters – CA Foundation BCR Notes

Example 8:
Enquiry and discussion – 2

Verma Cloth House
10, Chandni Cliouk. Delhi-110006

10th April,-2002
Goel Cloth House
B-8, Prem Nagar
Dear Sir.
Looking into our records we find that your credit rating is high. We are, therefore, surprised to find that your 15th February balance of ₹ 15,205 is so much overdue. What really worries is that even the two reminders of ours have not been replied. hope everything is line with you.
Do let us know by return post whether there has been any lapse on our past. Are you not satisfied with our goods or services₹ Is there any mistake or omission in our statement? Is there anything that we can do to help you?
You will always find us willing to accommodate you. With this promise w’e eagerly await your reply.
R.K.. Verma

4. Appeal and urgency stage:
In case there is still no response from the debtor he is trying to avoid payment and an urgent action is required. A strongly worded letter may be sent to a poor risk. But if the risk is good, the debtor may be induced to pay by making an appeal to his self-respect, justice, fairness and self-interest.

Hints For Appeal And Urgency:

  • Draw attention to the amount due and the time period for which it has been overdue.
  • Refer to the contractual obligations and the need to meet them in time.
  • Make an appeal to his sense of self-respect and self interest.

Example 9:
Appeal and Urgency

Verma Cloth House
10, Chandni Cliowk, Delhi-110006

20th April, 2002
God Cloth House
B-8, Prem Nagar
Dear Sir,
This morning our Chief AecountanL placed the statement of your account showing ₹ 15,205 due on my table with the following remarks :
“Account is seriously over-due. Debtor has not responded to three reminders. I suggest that this account be placed with the lawyers immediately”.
However, I wish to know from you the reason for your delay. Hence I am writing this personal letter to make a final effort to have a mutually agreeable solution to settle your account.
You will certainly realise that any further delay will affect your credit standing. Reputation once lost is difficult to regain.
Please note that it is necessary that your cheque reaches us by return post.
A business reply envelope is enclosed for your convenience.
Please help us to help you.
R.K. Vcrma Partner

5. Must pay or Last Resort Stage (Demand and Warning Stage):
When all efforts fail to work a last resort letter warning the debtor of legal action is written. This is the final stage in collection. At this stage it is more important to collect the money than to retain the customer. A definite time limit (generally not more than a week) should be given for legal action.

Last resort letters are comparatively brief and stern. They are written in direct style. Begin the letter with the threat of action. Then explain the effects on the debtor. Use the you viewpoint. The words should reflect concern not anger. In the close, offer a headline for payment and recall the appeal.

Example 10:
Demand and Warning

Rama Stores
D-7, Kamla Nagar, Delhi-110007

April 20, 2007
God & Sons
105, Cloth Market Jind.
Dear Sir,
This is your last opportunity to settle your account of ₹ 30,500 which is overdue for the last three months.
We have kept your account open for quite a long period in order to help you arrange for settlement.
We do value your business. But accounts cannot be kept unsettled even after three months after the expiry of the agreed term.
We shall keep your account open for 7 days after which the lawyers will be asked to move the ; matter to the court.
We are sure you will avoid the unpleasant consequences of legal action.
Ram Lal

Complaints And Adjustments:
In business dealings mistakes may occur on the part of both the buyer and the seller. Whenever a mistake causes inconvenience and financial loss to a customer he is likely to complain to the seller. The seller may or may not make adjustments, as requested by the customer, depending on the circumstances of each case.

Causes of Complaints/Claims:
Customers may make complaints to the seller due to several reasons some of which are as follows :

  • supply of defective or poor quality goods
  • defective packing causing damage to the goods in transit
  • carelessness in fulfilling the order
  • inordinate delay in supply of goods
  • wrong invoicing
  • careless handling of goods by the transporter.

Writing Complaint Letters:
The essential rule in writing a complaint letter is to maintain poise and diplomacy, no matter how justified the grievance is. Writing a letter of complaint is an art. Nobody likes to be directly told that he is wrong. Direct criticism is considered insulting.

A complaint letter should be clear and concise. It should be written in a polite but firm tone. The style used in a letter of complaint should be courteous and inoffensive. Tact and persuasion are necessary in making complaints.

Some guidelines for writing complaint letters given below :

  • State the mistake in a clear, calm and courteous style.
  • Explain the nature and extent of loss or damage caused in terms of money, sales, service or goodwill.
  • State the steps needed to rectify the mistake.
  • Make a specific claim stating the order number and date.
  • State clearly what is expected or desired.
  • Appeal to the supplier’s sense of fair play, expressing faith in his honesty and expecting prompt and favourable action.
  • Give the telephone number and address where you can be contacted. A few examples of complaint letters are given below :

Example 1:
A Complaint regarding damaged goods

New Delhi Printers
5, G.T. Karnal Road, New Delhi

10th October, 2001
The Sales Manager
West Coast Paper Mills Ltd.
Kodai Kanal
Dear Sir,
We are thankful to you for your prompt action in supplying paper as per our order No dated On opening the package of consignment we found that two reams of BOND-paper of 15 kg. are in a damaged condition. Since the other reams in the case are in a good condition, we feel what the damage was not caused in transit. Perhaps these reams, were damaged during cutting or pressing at your end.

We require this paper to print the Annual Report of one of our clients. The printing has reached the final stage. Would you be kind enough to replace these defective reams before 20th October, 2001?
Please confirm replacement.

Yours faithfully
S.K. Singh

Writing Formal Letters – CA Foundation BCR Notes

Example 2:
A Complaint about delay in supplying an order

Bhatia Stationers
15, South Extension, Part-1
New Delhi

20th December, 2001
The Sales Manager
Nagpur Industries Ltd.
Ramdns Pelh, Nagpur
Dear Sir,
On 1st December, 2001 we placed our order No. DS-11 with you for fifty dozen ball pens. So far we have not received this shipment and have not heard from you.
All these ball pens are required by a customer for their forthcoming conference. Your delay is causing a great inconvenience to him and a loss of considerable goodwill to us.
Please expedite the dispatch of goods ensuring that we receive them not later than 25th December, 2001.

Yours faithfully
S.K. Bhatia

Example 3:
A Complaint about careless supplying of an order

New Delhi Stores 38,
Ajmal Khan Road, New Delhi

15th March, 2002
Ahmed Dry Fruits Co.
Dauna Paula
Dear Sir,
Ref.: Our order No. 107 dated 1st March, 2002
We are thankful to you for the prompt execution of our order referred to above. We look delivery of the ten case* that you sent through Sandhu Transport Co.
On opening the cases we found that they contained dates whereas we had asked tor eashewnuts. Perhaps there has been a mix-up in supplying the orders and we have received dates ordered by some of her customer.
Our stock of eashewnuts has been nearly exhausted. Therefore, we request you to make an immediate replacement. You may cheek our order with the invoice you have sent.
We are keeping the eases of dales with us and aw’ailing your instructions for their further disposal.
B.S. Tandon

Replies to Complaints – Adjustments:
Every organisation has its own policy for handling complaints from customers. But all complaints cannot be handled in the same manner. Great care and patience are required for handling complaints. The customer is the most important party for the supplier.

Therefore, he must be satisfied. But it is also necessary to ensure that no unscrupulous customer takes undue advantage of supplier’s honesty. All complaints should be acknowledged promptly. A Complaint comes from a dissatisfied and unhappy customer. A politely word letter can help to rebuild goodwill and improve customer satisfaction. Great care is required in drafting replies to complaints. Replies to complaint letters may be of two types :

Letters Granting Adjustments:
When the customer is right, the supplier should make the necessary adjustment. In such a letter :

  • Admit the fault (make an apology) without making any excuse or giving any explanation.
  • Regret the mistake sincerely and assure that you will try to avoid its recurrence.
  • Make the necessary adjustment, stating clearly the action being taken.
  • Ensure the mistake will not appear again
  • End with a positive note to strengthen relationship.

Letters Refusing Adjustment:
When the customer is at fault, the supplier will refuse, adjustment. All the more care and tact is required in writing such letters. The following guidelines can be helpful:

  • Acknowledge the letter promptly
  • Explain why the adjustment is not possible. Your explanation should be factual and ethical.
  • Give the bad news (refusal). The refusal should flow logically from the explanation.
  • Be polite to retain the customer.
  • Be tactful as the reader may be upset.
  • You may express concern for the reader’s well-being or show respect for honest intentions.
  • Write in positive and persuasive manner
  • End with a positive comment.

Dear Sirs,
Ref.: Your order No. 107 dated 1st March
The cashewnuts you asked for in your order referred above have been dispatched today through Sandhu Transport Co.
There was an error in filling up your order which was being done along with another order bearing an almost identical number.
Our sales representative in your city will call on you within a couple of days for collecting the wrong cases which contain dates. The documents relating to the replacement cases are enclosed.
We sincerely regret the error that occurred on account of a confusion in case numbers and we assure that such a mistake will not be repeated.

Yours faithfully
M. Ahmed

Example 7:
A letter refusing claim

Kitchen King Appliances LTD.
Andheri (West), Mumbai – 400001

March 11, 2002
Ms. Bharti Arun
E-7, Model Town,
Dear Madam,
Thank you for your letter of 3rd March, 2002 telling us of vour difficulty with the Kitchen King Mixer, purchased recently, which did not work satisfactorily. The performance of every Kitchen King Mixer is guaranteed by us, and we are always glad to keep our promise. Immediately on receipt of your letter we contacted our agents, Mahavir Trading Co. Delhi, who sold the mixer to you. They have informed us that their representative visited you and after examination the mixer found that you mishandled the mixer ignoring instructions for use.

We regret to inform you that your claim for replacement of the mixer can not be entertained. However, we have requested our distributors to repair your mixer free of cost just because we always try to help our customers.

Sales Manager

Writing Formal Letters – CA Foundation BCR Notes

Circular Letters:
Circular letters are mass produced i.e. written to be sent to a large number of persons. They should therefore, be appealing and presentable ‘You’ attitude is another feature of an effective circular letter due to their persuasive nature.

A circular letter is different from an official circular which is a letter of memorandum addressed to several persons within the organisation. Office circular is an intra-office communication which seeks to bring to the notice important matters of the organisation.

Meaning of Circular Letters:
‘Circular are letters which are sent to a large number of persons at the sometime. These letter include the same message and are very useful when the message is to be sent to a large number of persons. Circulars help to save time and money. The coverage is large because the message is carried to a large number of persons. Circular prove quite useful provided they are written in an attractive style and appropriate tone.

A circular should look personal. The very nature of duplication leads the reader to think that he is not the only one to receive it. Any carelessness in writing or duplication may produce mass irritation. A bad circular is an adverse publicity. As a circular is drafted once, it should be perfected after revision several drafts. As the reader does not anticipate a circular, he is likely to discard it unless his attention is attracted and interest sustained. The use of ‘you’ attitude, catchy words, appropriate colour and informal tone help to make a circular effective.

The main purpose so a circular is to supply the same information to a large number of persons at the same time. Some other objectives of circulars are as follows:

  • to make the reader interested in the contents;
  • to impress the reader with facts and figures;
  • to gain the confidence of the readers;
  • to obtain publicity for a cause or merchandise.

Situations that require circular letters:
In business, circulars are needed on several occasions. A company has to inform every year its members about closing of the register of members and meetings. Trade associations and chambers of commerce provide information to members by means of circulars. A manufacturer often uses circulars to introduce new products.

Some of the situations that need circulars are as follows:

  • Establishment of a new business
  • Opening of a new branch or department
  • Expansion of an existing business
  • Change in address or premises
  • Introducing a new product
  • Obtaining or announcing an agency
  • Admission, retirement or death of a partner
  • Change in the constitution of the firm
  • Price reduction and clearance sale
  • Dissolution or discontinuance of business

Distinction Between Circular and Circular Letter:

Basis of Distinction Office Circular Circular Letter
1. Nature A means of communication within the A means of communications organisation A means of communications with outsiders
2. Purpose To inform the staff about some changes in official rules, procedures etc. To inform customers, etc. about new brands, etc.

Hints for drafting circulars and specimen circulars for each of these occasion given below:

Opening of a New Branch/Department:

  • Sate the name and address of the new branch in the letterhead.
  • Give in brief the development of the business and its popularity at other places.
  • Mention the date and time of the inauguration of the new branch.
  • Describe the goods and services offered.
  • Invite the customer to the inauguration or just to pay a visit to the branch.
  • Mention any special displays that are being arranged for the opening week.

The Gupta Garments
1, Beautiful Road
Attractive Nagar

October 3, 2002

Dear customer
We have come to your city. Gupta Garments is a very popular name in ready made garments. We have the appreciation of our customers in Delhi and U.R.

We are glad to announce the opening of a new branch in Ghaziabad for the convenience of our customers. Our new branch is large and spacious and keeps all varieties of readymades. Mr. Dinesh Gupta, who was with our Daryaganj branch for twenty years and is himself a resident of Ghaziabad, will be in charge of die new branch. You are invited to visit the branch shop on the opening day, October 17 at any time between 10 am and 7 pm.

We take this opportunity to thank you for your patronage and assure you the best possible services.

Yours sincerely

Change of Business Premises:

  • Give the new address in the beginning of the circular.
  • Explain the expansion of business requiring more space not available in the old premises.
  • Stress the advantages of the new location.
  • Shifting to new premises is to cause some delays and inconvenience to customers. Express regrets for the same.
  • Mention the date from which the change will be effective.
  • State the change, if any, in the telephone number,
  • Point out the additions, if any, made to the stocks.
  • Express gratitude for patronage and request for similar cooperation in future.

Goodwill Traders:
October 20, 1993

Dear customer
We have shifted from our old address at 1/5, Gupta Road, Delhi to 1, Aggarwal Mansion Prem Nagar, New Delhi
Owing to steady growth of our business it became necessary for us to move to larger premises. Our old premises were too small to accommodate our expanding business. Our customers were facing great inconvenience.

Our new premises are specious and easily accessible by road and railway. Parking facilities are adequate and our interior display is attractive. You will find shopping a great pleasure in our new premises. We have also added new varieties to provide a complete range of goods.

Remember our telephone number 1234567 remains unchanged. We request you to overlook the inconvenience caused during the period of shifting. We take this opportunity to thank you for patronage and hope to render even better service in the future.

Yours Sincerely,

Introducing New Products:

  • Draw readers’ attention with some catchy phrase.
  • Outline your progress and the regular improvement made for the benefit of customers.
  • Give news of the new product.
  • State the features and utility of the new product.
  • Express gratitude for patronage and request for its continuance.
  • Request a trial order from customers.

Pure Foods LTD.
11, Nehru Place New Delhi
Lick up Yours Lips

Dear customer,
As you know, we have been bringing out new varieties and products from time to time for our esteemed customers. We are now happy to announce the introduction of

Tasty Jams:
Our jams are available in five different varieties and tow types of packs. These are the result of our painstaking efforts over two years. Tasty Jams are very tasty, nutritious and hygienical produced on a fully automatic Swiss plant. The prices are very reasonable.

We are sure you will patronise our jams just as you have been using our sauces, pickles and other products for a long time. May we suggest to you to give a trial to Tasty Jams. You will forget all other jams.

Yours sincerely

Writing Formal Letters – CA Foundation BCR Notes

Obtaining of a Agency:

  • Explain the need for taking the agency-increasing demand for the product, etc.
  • Mention the area covered by the agency.
  • State the features, prices, etc., of the goods.
  • Inform that you can now execute the orders more promptly and can stock a wide variety of goods.
  • Notify the customers that all orders are to be booked with you and not directly to the manufacturer.
  • Offer special discounts, if any.
  • Request trial orders and cooperation.

Goodwill Traders
Dealers in all types of Kitchenware
5, Station Road, Agra

August 20, 2002

Dear Sir(s)
Hitherto you had to place your orders for Wonder Melmoware directly to the manufactures in Mumbai. We are happy to announce that we have been appointed the sole distributing agent for Wonder Melmoware for you city. We stock all varieties and you can now promptly get your requirements from us.

We are enclosing a catalogue and the latest price list for your convenience. Your orders will receive our prompt attention. According to our agreement with the manufacturers, all orders are to be executed by them only through us. A discount of 10% will be offered for every order above ₹ 5,000.
We look forward to the first of your regular orders and solicit your cooperation and patronage.

Your faithfully

Change in Partnership
Main changes in a partnership consist of admission of a partner, retirement or death of a partner, etc. These changes influence the capital and reputation of the firm and the confidence of the customers. Therefore, efforts should be made to win confidence by explaining how the change will improve the firm’s position and what steps are being taken to prevent any loss of capital or efficiency.

If a new partner is admitted, explain the reasons, e.g., expansion of business, need for additional capital and management talent, etc. Mention the special abilities and experience of the new partner. If the circular announces the retirement or death of a partner, express regrets at the loss of the partner and appreciate his services to the firm. Assure the reader that there will be no change in the policy of the firm and its relations with the customers. Solicit the continued patronage of customers.

Goodwill Traders
Dealers in all types of Kitchenware
5, Station Road,

August 31, 2002

Dear customer,
Your continued patronage has enables us to expand our business throughout the State. In order to handle the expanded business more efficiently we have admitted Mr. Ashok Gupta as partner. Mr. Gupta has been associated as a sales executive in a large company manufacturing kitchenware for the last fifteen years.

He has wide knowledge of kitchenware. Since our new partner brings a large capital the firm’s finances will be strengthened. There will however be no change in the name or policy of the firm.

We thank your for your cooperation in the past and hope that you will continue your valuable patronage to the firm.

Yours faithfully

Changes in the Constitution of the Firm:
A firm’s constitution is changed when it is amalgamated with other business or when it is converted into a company. While announcing such changes, the following points should be kept in view :

  • State that the developments of business required more capital and managerial talent.
  • Mention the new name under which the business will be carried on.
  • Refer to the management of the proposed company, e.g., number of directors, their qualifications, etc.
  • Assure that the change in the constitution will not change the firm’s policy of serving the customers to their satisfaction.
  • Request the customers to continue extending their patronage in future.

Goodwill Traders
5, Station road,

January 1, 2002

Dear patrons
Your cooperation has enabled us to grow. Because of the need for additional capital we have decided to convert our firm into a private limited company under the name. Goodwill Traders & Co. Pvt. Ltd.

The company has five directors all of whom have subscribed to the share capital. Each one of them is an expert in production or marketing or finance. Although the constitution of the firm has changed, we assure you that there will be no change in the policies and high service standards of our business.

We look forward to your cooperation and continued patronage as before.

Yours faithfully

Writing Formal Letters – CA Foundation BCR Notes

Price Reduction or Clearance Sale:
While announcing reduction sales, the following points are important:

  • Mention the date of commencement of the reduction sale. Also state the period for which the special sale is open.
  • Give the reason for the reduction sale.
  • Give special timing, if any, for the reduction sale.
  • Suggest that the customer should pay a visit to the store at the earliest to get advantage of the sale.

Goodwill Traders
5, Station Road,

October 4, 2002

Dear Sir(s)
On the eve of Diwali we have planned for you a grand clearance sale of our stocks. Prices have been marked down by 25% to 50% for almost all items. The sale starts on the 25th October and the offer is open till 5th November.

Hurry up! There is a Double Advantage. On our purchases worth ₹ 100 or more you get a lucky draw coupon. The lucky draw will be held on 13th November and you can win anything from a time piece to a TV.

We welcome you between 10 am and 7 pm, without any lunch break, for your convenience. In view of the great rush, please avoid bringing children and carry bags.

Your faithfully

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