Stages of Dunning Letters

   Stages of Dunning Letters

               Collection and Dunning letters are usually written in a series with the pressure increasing  from the first letter  to the last. Collection procedure falls into four stages.

      1)  Reminder
      2)  Stronger remisder
      3)  Discussion
      4)  Urgency

1. REMINDER:
                        Collection reminders are memory helps. They keep the bills  before the eyes of the delinquents. You assume that the customer has over looked the bill and will pay as soon as he reads the reminder.

2. STRONG REMINDER:
                             The strong reminder is a second memory jog put in strong terms. The phraseology becomes more definite, added pressure appears, and the request for the cheque is forthright.

3. DISCUSSION:
                              the aim of the letter of discussion is to get the cheque or the draw a reply from the customer. the customer has now ignored a simple reminder and a strong reminder of his obligation. So the request for a cheque or an explanation is insistent. The customer must pay. Although the letter exerts increasing pressure, itstone is coutteous. "Won't you tell us frankly what the trouble is".

4. URGENCY:
                       A letter of urgency  is a letter of force, delivering the ultimatum to the customer who has choosen to ignore two letters of reminder and third letter inviting discussion . The language of urgency is sharp and imperative . Leniency offered in previous  letter is now out of place. There is an insistence on immediate payment. It carries a threat og legel action , in case payment  is not  made by a fixed date.

Collection Letters OR Dunning Letters

              Collection letters and dunning letters  are those notices which are sent by a firm to its customers reminding the letter to pay their outstanding dues to the former.

             Now a days every seller has to face the problem of collection, as a sizeable bulk of business is done on credit .To solve this collection problem , the seller has often to resort to what is called collection or dunning letters.

                        Purpose of collection letter.
                        a good letter of collection has the following three-fold purpose:
                        1.  Collection the money
                        2.  Retaining the customer
                        3.  Building goodwill.

          Collection business has to be handled most carefully. It requires tact and patience. If the collection manager is impatient, or rude, or mishandles the situation in some way, He is likely to lose the money as well as the customer. The immediate purposeof a dunning letter is to recover the outstanding amount.It may happen some times that the recovery is made in such a harsh way that the firm may get the amount but alienate the customer from his business concern for good. This shows poor collection policy. the age - old maxim in this regard is - collect the amount but keep the customer. A good collection letter should go a step further by showing courtesy, It should try to cement relations and build goodwill.

Reply Letter of Holiday Accommodation

                                                                                                            Jun 17, 2011

Dear Mr. Saqib

Thanks you for your letter of 15th, Jun. I remember Mr. and Mrs Niaz very well and should like to thanks them for their recommendation.

We are well booked for july and august, but the flexibilty of your arrangements enables us to offer you the accommodation. your  require, namely one double and two single rooms, but only for the  two full weeks from 18th ,July.  After 31st, july. We are fully booked to the middle of september.

We looked forward to welcoming you to murree and assure you that every thing possible will be done to make your fotnight's stay a very happy one.

Please be good enough to send us written confirmation of this booking not later than next saturday.Meanwhile, we are provisionally reserving accommodation for you.

                                                                                     Yours Sincerely,
                                                                                       M. AKRAM