Money Minute – The Perfect Reminder Letter

Money Minute – The Perfect Reminder Letter

Summer holidays are over and as we approach autumn it is important to tackle any late payers who have neglected to pay during their annual break!

Reminder, or so-called ‘dunning’ letters, are effective for large-volume, low-value invoices or for companies that are difficult to reach over the phone.  Their purpose is to communicate information in a more formal and permanent form but their objective is just the same as a call – to confirm overdue invoices and obtain a response from the receiver, ideally payment.

Letters are useful for making contact with customers who are not available during normal working hours (one man band), they are an accepted form of commercial communication and are relatively economical to produce, so suitable for low-value debts. Putting things in writing creates a record of what has been sent to the customer.  Dunning letters can also be faxed or sent electronically.

The perfect dunning letter is addressed to the correct department, is carefully timed and contains accurate information. It is brief, to-the-point and does not contain any threats which the company does not intend to carry out. Finally, it sets a deadline for payment.

 

Before embarking on sending dunning letters, it is a good idea to decide how many to send and when.  Normal practice is to send two – it’s important to bear in mind that the more letters in the series, the longer the customer will expect to have before paying.

 

TIP:  

If you are unsure how to word dunning letters, why not ask your accounts department for sample letters received? You can then select the best and design your own.  

Alternatively, contact us for a free template from the website.

 

Dunning letter check list at a glance

 

Sending out reminder letters is a straight-forward process:

 

  • Send them correctly addressed to a named person/job title
  • Use simple, direct words and avoid jargon
  • Make the letter concise & to-the-point
  • Use coloured print, paper or email font.
  • Display amounts/ invoice details prominently and ensure the information is accurate – once sent, it is gone
  • State day and date for action
  • Vary content and timing
  • Highlight your right to charge late payment fee & interest as per the “Late Payment of Commercial Debts (Interest) Act, 1998 as amended and supplemented by the Late Payment of Commercial Debts Regulations, 2002”
  • NEVER make threats you do not intend to carry out
  • If e-mailing letters, obtain sent & read receipt confirmation

 

A goal without a plan is just a wish

Antonie de Saint-Exupery

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