Excerpt
2
Abstract
Generally and during commerce and business transactions are some steps to follow,
these steps drives to a better and a correct final. This paper attempt to show some of the essen-
tial points to a reader and students, which they relate to a branch of business studies. Today
with the fast global change technology and the wide internet usage, the world is more like a
village. The traders are more closers and the product, goods and services are available in a
wide range; the main point to reach these goods and services still a problem with the internal
and global laws and regulations, it steel some steps to follows like letters exchanging, docu-
ments, proves, file companies and etc...
The large and complicated business transactions need these steps and exchanging letters. Hav-
ing knowledge about how to addressee a letter from begin and to the end needs a very special
skills to success in the trade and commerce transactions. Now a day the internet and social
media are available and makes business contacting more easily, but it stills the essential doc-
uments to be signed and archived by both buyer and seller this process is so easily called
"business correspondence". However, it is important to know more and having information
about what is commerce and trade even shortly which this paper tried to open the way to the
readers and students.
3
Table of Contents
BUSINESS CORRESPONDENCE ... 1
A
BSTRACT
... 2
CHAPTER ONE ... 5
I
NTRODUCTION TO
C
OMMERCE
/T
RADE
... 5
C
OMMERCE AND
T
RADE
... 5
T
RENDS IN
F
REE
T
RADE
... 9
D
EVELOPMENT OF
M
ONEY
... 9
W
ORLD
T
RADE
O
RGANIZATION
N
EGOTIATIONS
:
C
URRENT TRENDS
... 10
T
HE
F
UNCTIONS OF
C
OMMERCE AND TRADE
... 12
T
HE
B
RANCHES OF
C
OMMERCE
... 13
CHAPTER TWO ... 15
C
OMMERCIAL
C
ORRESPONDENCE
... 15
CHAPTER THREE ... 18
T
YPES OF CORRESPONDENCE AND ESSENTIAL QUALITIES OF BUSINESS LETTERS
... 18
B
USINESS LETTERS
... 18
Claim/complaints letters ... 18
Complaint Letters Directed at Subordinates ... 20
MEMORANDUM ... 20
Application letters ... 21
Approval/dismissal letters ... 23
Sales letters ... 24
T
HE
E
SSENTIAL QUALITIES OF
B
USINESS LETTERS
... 25
I
NNER QUALITIES
... 25
O
UTER
Q
UALITIES
... 26
CHAPTER FOUR ... 27
4
C
HARACTERISTICS OF BUSINESS
L
ETTERS
... 27
T
HE MAIN PARTS OF BUSINESS LETTERS
... 27
T
HE
L
AYOUT OF BUSINESS LETTER
... 29
S
AMPLE
B
USINESS
L
ETTER
L
AYOUT
... 29
Contact Information ... 29
Body of Business Letter ... 30
REFERENCES ... 31
5
Chapter One
Introduction to Commerce/Trade
Commerce and Trade
Commerce, also referred to as trade, varies from business. Business described the val-
ue-creating operations of a for profit organization, while commerce refers to an economy's
entire system which forms or creates the environment for businesses. Commerce as a system
includes the economic, legal, social, political, technological and cultural elements, which op-
erate within the jurisdiction considered. Therefore, commerce refers to a system or the envi-
ronment, which influences the business potentials of economy or a state or nation (Glyn,
2002). The second component of business may also be defined as all the operations, institu-
tions and functions, which contribute in the process of transfer of goods from the production
process to the final consumer.
Trade refers to the exchange of rights of products and services from one individual or
body to another by obtain something else from the purchaser or buyer. Sometimes, it is loose-
ly referred to as financial transactions, commerce, or barter. The market describes the net-
work, which facilitates trading activities. The earliest approach to trade was barter, which de-
scribes the direct swap over between products and services (Watson, 2005). Subsequently,
precious metals (coins, poles), metals, bill then paper money replaced one side of this form of
trade. Presently, modern trade is facilitated through an exchange medium, for instance mon-
ey. This has facilitated the separation of buying from selling, or from earning. Money's in-
vention (and subsequently raw cash, credit, and cashless values) significantly simplified and
enhanced trading activities. A trade, which involves two traders, is referred to as a bilateral
trade, whilst trade amongst multiple traders is referred to as a multilateral trade.
The existence of trade for man is owing to division of labor and specialization, since
most individuals focus on a particular production facet, trading these for other prod-
ucts/services. The existence of trade amongst regions is owing to the fact that various regions
possess a comparative benefit in the manufacture of some specific tradable commodities, or
owing to the fact that different regions' magnitude permits for the advantages of collective
production. Owing to this, trading at market prices amongst the different regions is advanta-
geous for the regions. Retail trading comprises of the sale of products or commodities from a
6
very permanent location, for instance a store, kiosk or boutique, or through mail, in limited or
unit lots for immediate consumption by the buyer. Wholesale trading is described as the trade
of products or commodities to industrial, institutional, commercial or other professional trade
users, to retailers, to subordinate users or to other wholesalers (Bernstein, 2008). Trading may
also describe the actions traders and other market players perform within the financial system.
The origination of trade may be linked back to the commencement of communication
in medieval periods. Trading served as the major the facility utilized by prehistoric people,
who exchanged services and goods amongst each other prior to the development of the pre-
sent day currency. The history of distance trading has been dated by Peter Watson from circa
150,000 years before now (Watson, 2005).
It is believed to have commenced all through most part of documented human history.
Evidence regarding the interchange of flint and obsidian in the course of the Stone Age is ac-
cessible. Materials utilized for the jewelry production were exchanged with Egypt as far back
as 3000 BC. Long-distance trading route first emerged during the 3000 BC, when trading oc-
curred between the Mesopotamian Sumerians and Indus Valley's Harappan civilization.
Notable sea traders, traversing through the Mediterranean Sea, and the northwards Eu-
rope Britain for tin sources in order to manufacture bronze were noted. Owing to this they
created trade settlements, referred to as emporia, by the Greeks. During the commencement
of Greek civilization till the fifth century collapse of the Roman Empire, an economically lu-
crative trade resulted in valuable spice to Europe from the Eastern states including China and
India. Through Roman trade, the empire successfully endured and flourished. This was ow-
ing to the fact that The Roman Empire was able to manufacture a predictable and safe
transport network which facilitated the delivery of trade products without the risks of critical
piracy (Watson, 2005).
The Roman Empire's collapse and the succession of the Dark Ages resulted in insta-
bility to Western Europe as well as an narrow survival of the western world's trade network.
Nevertheless, trade continued to thrive amongst the kingdoms of Middle East, Africa, China,
Southeast Asia and India. Certain amounts of trade did not take place in Europe. For exam-
ples, Radhanites were an ancient guild or cluster (the actual connotation of the term is lost to
record) of Jewish traders who traded amongst European Christians the Near Eastern Muslims.
7
In the course of the middle Ages, the economy of Central Asia dominated global trade
(Watson, 2005). The Middle-Eastern route was dominated by the Sogdians from 4000 AD till
8000 AD, with Talas and Suyab existing as their major northern centers. They majorly existed
as Central Asian caravan merchants. Between the 8th and 11th century, the Varangians and
Vikings traded while sailing to and from Scandinavia. Varangians sailed to Russia while Vi-
kings journeyed towards Western Europe.
In 1498, Vasco da Gama pioneered the Spice trade of Europe upon his arrival at Cali-
cut subsequent to his journey round the Cape of Good Hope as well as Africa's southern tip.
Before this, Islamic authorities, particularly in Egypt, regulated the transportation of spice
from India to Europe. This trade had a significant economic significance as it contributed to
the spurring of Europe's Discovery Age. The Spices, which were transported into Europe
from India and other Eastern countries, comprised of some of the most precious products con-
sidering their weight, sometimes competing gold. By the 16
th
century, the 17 Provinces
emerged at the middle of the free trade, mandating no exchange regulations, and promoting
the free transportation of commodities. Trade within the East Indies was controlled by Portu-
gal in the sixteenth century, by Holland during the seventeenth, and by British during the
eighteenth. The Spanish Empire through the Pacific and Atlantic Oceans (Watson, 2005) de-
veloped regular trade links.
By 1776, Adam Smith released a publication titles An Inquiry into the Nature and
Causes of the Wealth of Nations. This piece criticized Mercantilism, and emphasized that
economic specialization was capable of benefiting countries and not only business organiza-
tions. Owing to the fact that labor division was limited by the market size, he explained that
nations with limited access to bigger markets would effectively be able to divide labor thus,
subsequently turning to be more productive. Smith further explained that he perceived all ra-
tionalizations of export and import controls dupery, which negatively affected trading coun-
tries in general to the advantage of particular industries. By 1799, the Dutch East India Com-
pany, initially the largest company in the world, went bankrupt, partially owing to the increase
in competitive free trade (Watson, 2005).
Ricardo, Mill and Torrens, in 1817, proved that free trade would be advantageous to
the industrially strong as well as the weak, through the famous comparative advantage theory.
In Principles of Political Economy and Taxation, the author presented the doctrine still per-
ceived as the most counterintuitive doctrine in economics; he explained that when an incom-
8
petent producer transported the merchandise it manufactured effectively to another country
capable of producing it more effectively, both nations would be on advantage (Watson, 2005).
The dominance of free trade was majorly based on country benefits in the mid nineteenth cen-
tury. This means, the computation made was about the potentiality of a specific country's self-
interest to attract importation into its borders.
It was proven by John Stuart Mill that that a nation enjoying pricing monopoly for the
global market could influence the trade term via the maintenance of its trade tariffs, and that
the reaction to this may be reciprocity in polices of trade (Watson, 2005). Ricardo had earlier
suggested these. Subsequently, this ideology was considered evidence away from the global-
ly adopted free trade doctrine, as it was considered that majority of the surplus in economy of
a trade would accumulate to a country following mutual, rather than totally free, trade princi-
ples. This was succeeded in a couple of years by the early industry scene created by Mill
propagating the ideology that it was the duty of the government to safe guard emerging indus-
tries, even though only for a period required for them to emerge to full competence. This pol-
icy was applied in many countries working towards industrializing and out-competing English
exportations. This ideology was subsequently supported by Milton Friedman, who indicated
that in some few circumstances, tariffs might benefit the host countries; but by no means for
the whole world (Watson, 2005).
Another important factor that influenced the trading approaches was The Great De-
pression. This phenomenon resulted in an economic recession, which occurred from 1929 till
then end of the 1930s (Bernstein, 2008). In the course of the great depression, there was con-
siderable drop in trade activities as well as other indicators of the economic performance.
Numerous individuals viewed the unavailability of free trade as the principal reason
for the great depression. It was only in the course of the Second World War that the effects of
the recession were no longer felt in the US. In addition, in 1944, during the WWII, the Bret-
ton Woods Agreement was signed by 44 nations; with the intention of prevent trade barriers
amongst countries, so as to prevent future depressions. This treaty established institutions and
rules for the regulation of global political economy: which included the International Bank for
Reconstruction and Development (subsequently separated into International Settlements and
World Bank and Bank) and International Monetary Fund. These systems became functional in
1946 when the motion had been ratified by enough countries. By 1947, the General Agree-
9
ment on Tariffs and Trade for the promotion of free trade had been sighed by 23 countries
(Watson, 2005).
Trends in Free Trade
The popularity of free trade further advanced around the end of the twentieth century
and in the early periods of the millennium. The table below is an indication of the various ac-
tivities which played notable roles in the emergence of free trade:
Date
Event
1992
Barriers to internal trade were lifted by the
EU
January 1, 1994
The North American Free Trade Agreement
(NAFTA) was implemented
1994
The GATT Marrakech Agreement provided
specification for the structuring of the World
Trade Organization.
January 1, 1995
The World Trade Organization was estab-
lished to aid free trade, through the mandating
of mutual most favored State trading status
amongst all members
2002
The EC was changed to the European Union,
which led to the completion of the Economic
and Monnetary Union (EMU), via the intro-
duction of the Euro, and through this, creating
a real single marketplace between the 13
member states (as at 1st January, 2007).
2005
The signing of the Central American Free
Trade Agreement involving the US and The
Dominican Republic
Development of Money
The earliest occurrences of money can be seen through objects which had inherent or
natural value. Such form of monetary delineation is referred to as "commodity money" and
comprises of any commonly accessible commodity which has inherent or natural value; his-
torical instances of commodity money include pigs, scarce seashells, cattle and whale's teeth.
Bread was utilized in ancient Iraq as an early money type while cocoa bean was used in Mex-
ico (Glyn, 2002).
10
Currency was later introduced as a standardized form of money for the facilitation a
broader exchange of products and services. This earliest phase of currency, involved metals
utilized for the representation of stored value, and symbols for the representation of commodi-
ties, served as the foundation for of trade in the Fertile Crescent for more than a century and
half. There are various examples of early coins from mediaeval large-scale communities,
however these were originally precious metal lumps which were unmarked (Glyn, 2002). In
ancient Sparta, coins were minted from iron in order to prevent residents from participating in
foreign trade.
World Trade Organization Negotiations: Current trends
Different negotiations have resulted from the institution of the World Trade Organiza-
tion. For instance, the Doha rounds of the WTO negotiations works towards lowering obsta-
cles to global trade globally, with a concentration on ensuring that all trade negotiations and
processes are free and fair in order to assist the continuous development of developing states.
Negotiations between developing and states have been influenced by the difference between
the developed states, characterized by the G20, and the notable developing states. Subsidies
on agricultural activities are the most notable issues which agreements have been the most
difficult to discuss. In contrast, there was notable consensus on capacity development and
trade facilitation. The commencement of the Doha round was in Doha, Qatar, while subse-
quent discussions held in: Mexico; Switzerland; France and Hong Kong.
It will be incomplete to discuss trade trends without specifically mentioning the con-
tributions of the PRC. Commencing around 1978, the authorities of the People's Republic of
China (PRC) started an experimental in economic reformation. Unlike the previously utilized
Soviet-approach majorly strategized economy, the new strategies increasingly relaxed limita-
tions on farming, agricultural allocations and, after a number of years, urban business and
employment. The increased market-oriented strategy cut down inefficiencies and motivated
private investments, especially by farmers, which resulted in enhanced output and general
productivity. One characteristic was the creation of four (subsequently five) Special Econom-
ic Zones distributed across the South-eastern coast. These reforms turned to be spectacularly
successful with regards to the increased outputs, quality, variety, demand and price. In quanti-
fiable terms, there was a 100% growth in the economy between 1978 and 1986, and another
100% growth was recorded by 1994. Another 100% economic growth was yet again, recorded
in 2003. In terms of per capita basis, the 100% increase from the 1978 stand occurred in
11
1987, 1996 and 2006 (Watson, 2005). As at 2008, the size of the economy almost 17 times
(about 16.7 times) its initial size as at 1978, and over 12 times its initial per capita standings.
There was a more rapid progression in international trade, as it averagely doubled after every
four and half years. The overall two-way trade as at January 1998 surpassed that for the en-
tire 1978; as at the first quarter of the FY2009, the trade level had exceeded the trade level
recorded for the whole of 1998. By 2008, the two-way trade recorded by China totaled
"US$2.56 trillion" (Cameron & Campbell, 1998). The PRC became a member of the Asia-
Pacific Economic Cooperation group in 1991 this organization is a trade-promotion medi-
um. By 2001, the PRC also became a member of the World Trade Organization.
The increasing rate and acceptance of international trade by various states has also in-
creased its significance in the trends of global trade. International trade has also refers to the
exchange of commodities and services across the borders of the nations. In most nations, in-
ternational trade activities represent a major segment of the GDP. Although international
trade has been present for most of history, the economic, political and social significance as-
sociated with it can be seen to have increased in recent times, majorly owing to the Industrial-
ization, globalization, advanced transportation, emergence of multinational companies, and
increased amount of labor outsourcing. As a matter of fact, it is possibly the increase in the
occurrence of international trade that is commonly connoted as globalization.
Experimental evidence for the accomplishment of trade may be observed through the
variations between nations like South Korea, which implemented a policy for export-based
industrialization, and India, which traditionally had a more restricted strategy (even though, as
at 2005, had started opening its economy). South Korea's economic performance has been
considerably better than that of India in the last fifty years however its accomplishment is also
attributable to the state institutions.
Various trade instruments contribute to the status international trade status or operabil-
ity of different states. These instruments are utilized by the World Trade Organization to ex-
ercise its authority over member states as well as facilitate or improve trade conditions within
the international market (Jackson, 1998). One of the major instruments utilized by the WTO is
Trade Sanction. Trade sanctions against a particular state may be imposed, as a means of pe-
nalizing the state for particular actions. A trade embargo or restriction is a severe type of ex-
ternally forced isolation, which results in the obstruction of every form of trade by one state
12
on the other. For instance, the US has had a trade embargo against Cuba for more than forty
years.
Trade barriers are also sometimes applied. Even though there are typically few trade
limitations within states, international trade is typically controlled by governmental quotas
and borders, and usually taxed through duties. Duties are usually placed on imports, however
sometimes stats may impose export duties or some form of subsidies. These are all referred to
as trade barriers. Should a government remove all forms of trade barriers, then a circum-
stance of free trade would be noticed. A state which applies a protectionist rule establishes is
a state which utilizes trade barriers.
The trade justice movement, also referred to as the fair trade movement, works to-
wards ensuring the consideration and application, social standards and environmental princi-
ples for production of commodities, especially those exported from the developing countries
to developed states. Such ideologies have also resulted in an argument on if trade itself should
be considered a human right (Should trade be considered a human right? 2008). Importing
companies willingly adhere to fair trade principles or governments may impose them through
the integration of commercial and labor laws. Suggested and implemented fair trade stand-
ards vary generally, ranging from the ordinary ban of goods produced through slave or co-
erced labor to minimum pricing systems such as those which were imposed on coffee trade
during the 1980s. The roles played by non-governmental organizations in the promotion of
fair trade standards can be overstated as they serve as independent observers of the conformi-
ty of organizations to the trade standards.
The Functions of Commerce and trade
Apart from the direct function of commerce, which is to facilitate the exchange of ser-
vices, products and resources within the society, the resulting outcomes may also be seen as
functions. The importance of commerce and trade cannot be overstated owing to the level of
influence it has on the business environment. With the consideration of international context,
international commerce and trade may be seen to function in other aspects such as the facilita-
tion of economic, social, and political development.
The effective functioning of commerce facilities economic development owing to the
fact that once the trading environment is conducive there would be a smooth interaction be-
tween the producers and the consumers. This will result in satisfied consumers and profitable
13
companies. The increase in profits of companies operating within a State does not only posi-
tively affect the state economically on the basis' of the taxes and duties derived from these
companies but also significantly contributes to improving economic variables such as em-
placement level and per capita income. The improvement in the economic development facili-
tated by commerce subsequently contributes to the improvement of other aspects of society.
One of the aspects which is positively affected by the improved economic conditions
resulting from the effective functioning of commerce is social development. Industrialization
and socialization have been repeatedly explained to be related to each other. With an effective
functioning business environment resulting from friendly commerce and trade conditions, the
probability that investors would be attracted to such environments is high. This will result in
an improved rate of industrial growth resulting in the migration of diverse individuals to such
societies. The basic element for social development is effective interaction in a diverse socie-
ty. Industrialization will lead to increased labor demand, which will subsequently result in the
increased diversity in society. The interaction between these diverse members of society,
which is influenced by their contributive roles to the commercial functions, will result in so-
cial development.
In considering the international allies which result from international trade, the role of
commerce in peaceful co-existence will be identified. Owing to the usually mutual benefits
resulting from the relationships shared by different States as a result of the trade treaties they
share, there some of guarantee of continuous peaceful coexistence between some states. It is
important to note that one of the major factors affecting the decision of any authority is the
economic factor. This may then be followed by the security factor. Owing to the fact that
trade treaties ensure that different states mutually and fairly benefit from each other, then it
can be said that they contribute in the solidity of the political systems in such countries. Inter-
national trade between states guarantee economic benefits and (owing to the intention of the
states to sustain these economic benefits) also guarantees security at least considerable the
relationship between such states. These two factors are basic for the successful politicizing of
any state.
The Branches of Commerce
The branches of commerce may be seen by considering the major purpose of com-
merce. Commerce is majorly designed to facilitate the transportation of products from the
producer to the final consumer. Thus, the branches of commerce may be identified by consid-
14
ering the processes or activities directly involved towards ensuring that the products or ser-
vices offered by a producer reach the final consumers (Rogowski, 1990). Based on this con-
sideration, it may be stated that the five major direct branches of commerce include: trade;
transportation; warehousing; banking; and insurance.
Trade, with respect to its role as a branch of commerce, refers to the exchange of
products, services and resources by all the parties involved in the commercial system or the
considered industry (Krugman & Obstfeld, 1988). Trade as a branch of commerce is divided
into two types, home trade and international trade. Home trade, refers to all the exchange of
products, services and resources limited to or confined within the borders of the country.
Home trade is divided into whole sale and retail trade. Wholesale, refers to the trade between
the producers of the companies and the vendors of the products (or retailers) while retail trade
refers to the trade between the vendors and the final consumers of the product. International
trade as the name implies refers to the cross border exchange of products, services and re-
sources. The two branches of international trade comprise of import and export (Rogowski,
1990).
Transportation, the second branch of commerce refers to the movement of products
from the point of production towards the final consumer. The means of the movement of these
products may be by land, sea, or air. The commerce function of transport also involves the
roles played by the people and agents involved in facilitate the movement of these products
towards the target consumers. The communication is particularly closely related with
transport: the postal system, internet, business correspondence, internet, telephone, etc. all
contribute to the transportation process. It is important to note that without transport, the
manufactures products will remain unsellable thus resulting in a possible surplus of products
in one part of the market and an extreme shortage of such products in another part of the mar-
ket. Communication also effectively contributes to the transportation function owing to the
fact that it reduces the bottlenecks and delays in the transport process. It is also effective in
the demand and supply process as it is through effective communication that the producers
and consumers are aware of the demand and available stock respectively.
Advertisement is another important branch of commerce. Owing to the fact that the
perception of consumers regarding a product or service may vary, based on their diverse
backgrounds, ideologies and needs, it is important to always work towards identifying the
15
possible needs of diverse consumers which may be satisfied by the various aspects of the
product or service.
Other branches of commerce include warehousing; banking; and insurance. The suc-
cessful performance of each of these functions can only be facilitated through the effective
communication. This is because each of these functions requires the continuous exchange of
messages between the various human elements working within the systems. Although com-
munication is not a direct branch of commerce, it contributes to the successful functioning of
all the various branches of commerce.
Chapter Two
Commercial Correspondence
From the review presented in the previous chapter, it can be seen that commerce is an
important aspect of development and possibly influences all branches of existence. However,
a number of factors may be considered contributive for the effective implementation of com-
merce-based activities. The effectiveness of commerce is a function of the effectiveness of the
different players existing within a commercial environment (Kroon, 1995; Jeffs, 2008). This
means that the effectiveness of commerce is influenced by the different organizations and
firms operating within the industry. Therefore, understanding the factors that contribute to the
successful performance of an organization will contribute in the understanding of the different
factors that affects the entire commerce industry. Communication has been identified as one
of the major factors affecting the effective performance of the operations related to an organi-
zation (Rankin, 2010). This chapter presents an overview of the importance of business com-
munication to an organization.
Also referred to as a business correspondence, a commercial correspondence, is a
method of information exchange or communication through a written format for the purpose
of business actions. Commercial correspondence may occur within an organization, between
different organizations, or between organization and its consumers. There are various formats
of commercial correspondence which are universally utilized and accepted (McLean, 2010).
Commercial correspondences are usually in the form of business letters (also known
as commercial letters). A commercial letter refers to a letter which is written in official lan-
guage, traditionally utilized when writing from one organization to another, or when writing
16
correspondence within the organization, or when interacting with consumers, external parties,
or clients. The generally utilized style of the letter is dependent on the relationship shared be-
tween the concerned parties. Numerous motives may motivate the writing of business letters.
It may be to request express action or information from the second party, to place an
order for supplies, to spot an error which was committed, to directly reply to a request, to
make an apology for a mistake to simple convey pass a goodwill message. Business letters are
useful until date, owing to the fact that it can be permanently documented, is confidential, of-
ficial and delivers influential, well-thought messages (McLean, 2010).
Effective communication can be achieved when the messages shared between two or
more individuals are received and clearly understood by the other individuals involved in the
ineffective action. For communication to be considered effective, it is necessary that the recip-
ients of the messages have received and fully understood the messages being sent to them. As
a result of the full understanding of the messages sent to them, the recipients of messages are
able to provide better responses when they are communicated to. When the message is re-
ceived, fully understood by the recipient, and in the context of the sender, and responded to,
by the recipient (who becomes the sender), then communication is considered effective.
Communication plays an important role in the process of interaction between business
organizations. Upon the occurrence of communication, it means that the messages were effec-
tively communicated. A potential business partner who receives ineffective communication
from the representative of a company will most probably possess a negative response to the
organization. This is also same for a consumer who perceives or receives ineffective commu-
nication messages from the representative of an organization. This may not necessarily mean
that the message sent by the sender is sent in a deliberately wrong way, this may however be
owing to the fact that the recipient person does not clearly understand the message sent by the
sender. That is to say the context in which the sender intends for the message varies from the
recipients contexts for interpreting the message. There is a possibility that the request is am-
biguous, or the recipient of the message failed to closely concentrate or pay attention to the
messages sent.
Communication has been referred to as one of the most fundamental functions for or-
ganizational management (Mattock, 2003). The importance of communication can NOT be
overemphasized. It describes the act of sharing ideas via, information, thoughts, plans, and
opinions, amongst the different sections of an organization as well as to those beyond the or-
17
ganization whom have a specific concerns or interests in the organization and intent to be
aware of specific information. It is impossible for human relations to exist without communi-
cation. Effective and optimal communication is necessary for both successful business inter-
action and personal relationships. Business software and other renowned applications may be
utilized for communication writing communications, as well as other conventional methods
such as telephone calls and business letters. Notwithstanding the method communication, it is
important to ensure that this method facilities message sending and receiving/understanding.
It is also important for the listener to note and understand exactly what is being communicated
to them.
All available methods of communication are important for business organizations. The
major advantage associated with written methods of communication is that they may act as
documented record while phone based methods may act as the instigator for important busi-
ness relationships. In-person communication assists in the promotion of business principles
as well as the improvement of the performance of the organization's products. The effective-
ness of this method of communication can be felt more in the interaction between organiza-
tions and customers. Such communication methods would support customer retention as the
relationship shared between the customers and the organizations would encourage the cus-
tomers to always return to the company's products (Brown & Sulzer-Azaroff, 1994).
Reputation and credibility in business ought to be kept as optimal as possibility by the
management of the organization in order to ensure that the clients and business partners con-
tinue to trust the abilities of the organization. Possessing a sense of professionalism will at-
tract considerable advantages to the organization, specifically with regards to the development
of lasting relationships with clients, employees and business partners. It is important to ensure
that all business deals are properly and promptly attended to. The performance of optimal
business communication does not only comprise of interacting with external contacts but also
encompasses the interaction with the organization's employees. This will assist the effective
organization of the business origination and will greatly contribute to increasing the optimali-
ty and promptness of the delivery of the business processes (Baxter & Braithwaite, 2008).
It is important to note that the effective communication, as well as general manage-
ment of the operations of an organization is strongly influenced by the ability of the manage-
ment of that organization to align the effectiveness of the internal operations with the targeted
success of the external operations. Thus, the communication process and patterns associated
18
with an organization must encompass both the internal and external aspects of the organiza-
tion. Thus, in order to ensure that an effective communication pattern is observed externally
(with clients and business partners), the management of an organization must work towards
ensuring that an effective internal communication approach is developed within the organiza-
tion (Baxter & Braithwaite, 2008).
From the various paragraphs discussed above, it can be concluded that the following
advantages are associated with optimal communication: credibility; identification of consumer
needs; identification of supply needs; information sharing; and development and maintenance
of business allies.
Chapter Three
Types of correspondence and essential qualities of business letters
There are various forms of commercial correspondence. This section identifies the dif-
ferent types of business correspondence and with major focus on the identifying the signifi-
cant qualities of business letters. The section presents samples of the various correspondence
types identified. Major focus is placed on business letters owing to the fact that it is the origi-
nal method of business correspondence.
Business letters
The most formal technique of communication is through a business letter. These let-
ters are addressed to a specific individual or company. An excellent commercial letter con-
forms to the seven C's of communication. The various business letter types, with regards to
their contexts are discussed in the following sections of this chapter.
Claim/complaints letters
A business claim/complaint letter regarding a superior ought to be formatted in the
style of a formal business letter. Employees pointing out areas of dissatisfaction might be
concerned that such a letter may result in negative repercussions to their careers. Neverthe-
less, appropriately writing and sending such letters will serve as a formal documentation for
an authentic complaint. Such letters are usually only subsequent to the discussion with the in-
dividual occupying the superior position. Complaint letters directed to superior officers ought
to be concise, courteous factual, and professional, and might be copied to the leader of the
19
Human Resources/Administration Department. It is important to ensure that the complaint
letter directed towards a superior states all the details related to the complaint but should in
terms of facts rather than personal or emotional sentiments. As follows is a sample complaint
letter:
20 May 2012
Mr. Patrick Eru
Human Resources and Development Manager
Biskit International, Inc.
777 Allen Blvd., Suite 870
Costa Mesa, CA
Dear Mr. Eru:
With regards to BNiskit International, Inc.'s policies, kindly consider as a formal complaint
against Mr. Samuel Toski for Verbal Harassment.
On different occasions which included February 16, 2012 and May 16, 2012, scenes at the
Executive Boardroom involved Mr. Toski repetitively telling everyone available sexually-
related jokes and using demeaning terms while referring to various parts of the female anato-
my. In the two occasions, he would pass these comments at me. The instances of utilizing of
sexually explicit terms to scorn me were made in the presence and hearing distance of the
other employees.
Throughout this scenbes, Mr. Toski also repetitively told everyone within hearing distance
that he was going to have his way with me soon. Ms. Darlene Pardol and Mr. Titus Sende
were both amongst the witnesses this events. The aforesaid event has made me mentally anx-
ious.
In my opinion, such attitude is not in conformity with Biskit International, Inc.'s principles
and ethics of proper work environment behavior as defined in Chapter Six of the Employee
Manual. I consider myself violated by Mr. Toski's behavior and perceive that I was harassed.
I am conscious that submitting this complaint against Mr. Samuel Toski will necessitate an
official investigation and I am ready to contribute as required.
Sincerely,
Signed
Surname Name
20
Complaint Letters Directed at Subordinates
Complaint letters meant for subordinates may be of a sensitive nature. Superiors may
be judged unfairly. Although respectfully and carefully written, complaint letters directed to
the subordinates are capable of producing positive results. As a superior, an individual may
perform this by not approaching the subordinate considered to be faulting in a disdainful
manner. It is important for superiors to avoid repeatedly alluding their position. Subjects of
such letters may include absenteeism or habitual tardiness, sloppy work execution, employee
misbehavior.
Notwithstanding the case, the letter complaint letter may be used as an avenue of effectively
making orders which may contribute to correcting the situation or encourage a compli-
ance/positive change on the subordinate's part.
The following is a memorandum sample from the Human Resources/Administration Head to
immediate subordinates:
MEMORANDUM
This refers to a document utilized internal communication within the organization.
The memorandum may be written by management and published to all employees or by a
HOD for members of a department.
Memorandum
May 20, 2012
From: Paul Ona, Human Resources /Administration VP
To: Tony Okoh, Executive Assistant
Subject: Notice of Regular Tardiness
This is to formally nitrify you that you have been late for work over five times in the last five
weeks. Though you have been initially notified concerning your regular tardiness, you have
shown no considerable improvement interests. Rather, you have continuously shown general
negligence of policies of the company regarding attendance.
Although you may possess the potential of becoming an effective administrator, the disregard
you have shown for organizational attendance policy can be a significant obstacle.
21
Owing to your constant lateness, I must inform you that I have observed this attitude and ex-
pect it to discontinue. It is necessary that you get to work on time in to respond to company
telephone calls from 9 a.m. and deal with operational updates and other organizational tasks.
Kindly organize your morning schedule so you can get to work five minutes prior to the or-
ganizational official workday. Please check in with me at my office upon arrival. I am certain
you will solve this problem with some extra efforts.
All further violations of organizational policies or failure to deliver in conformity with organ-
ization principles will lead to a six-day suspension without additional warning.
Application letters
Application letters also refer to a form of letter, which are used majorly to indicate in-
terest in job openings publicized by business organizations. Below is a sample of a job appli-
cation letter:
May 20, 2012
Mr. Patrick Eru
Employment Manager
Bizzle Pharmaceutical Corporation
12345 Jeff Parkway
Roanoke, VA 24019
patrick@bizzlepharmaceutical.com
Dear Mr. Patrick:
From the corporate website of your company, I was informed about the need for a
sales representative for the Maryland, North Carolina and Virginia areas. I am interested in
the position with Bizzle Pharmaceuticals, and consider that my academic and employment
background are suitable for this position.
While pursuing a master's degree, I gained employment as a sales representative with a small
bakery. I successfully increased my profit marking and sales volume appreciably while work-
ing with Delight Bakery, and I would love to repeat such success rates in the pharmaceutical
22
market. I have a good academic background in marketing and biology, and I believe that I
may apply my combination of understanding and experience to the market. I will be through
with my master's course in mid-June and would be available to commence employment in
early July.
Enclosed is a copy of my resume, which includes additional details of my qualifications.
I look forward to discussing with you as regards sales opportunities with Bizzle Pharmaceuti-
cals. I will contact you next week for a confirmation that you received my resume and email
and to answer any possible questions.
Thank you for your consideration.
Sincerely,
Shim Bobo
23
Approval/dismissal letters
Another type of business letters are approval letters. In the organization, certain formal
approvals are usually required for the in different instances. Most approval letters usually
comprise of the employees of an organization seeking certain benefits from the management
of the organization. Examples of such benefits include loans, grants, leaves, travel allowances,
etc. This section of the chapter is a representation of the various approval letter samples.
Credit Approval Letter for a Grant: approval letters for grants are usually started by
going straight to the basic point of the letter. The agreement's summary may be indicated in
the body of the letter. When the terms and conditions are included within, then there will be
no need to offer a lengthy unless explanation except these provisions are not affected by the
terms and agreements of the loans. The following is a sample letter of approval for a loan or
grant:
Date
Name of Sender
Company Position
Department
Address of Sender
Addressee
Organizational Name
Company Address
Dear Name:
This is to inform you that we have received and reviewed your application for a loan. We are
glad to inform you that your request has been approved and is presently processed.
Having a minimum tangible asset of (amount) and a minimum owner's equity of (percentage
as per total asset), our company has decided to grant you the loan. Under suitably executed
security documents you shall provide us with the following collateral as security for the cred-
it:
Accounts receivable to $100,000, and equipment with a carrying value of $15,000.
24
Your written confirmation of agreement must be secured, as we are ready to business based
on the terms contained therein.
We are glad to be doing business with you. Thank you.
Sincerely,
Your name
Sales letters
Official letters may be written by hand or printed. The developments in technology
have resulted in the utilization of new business correspondence methods such as Fax and E-
mail (McLean, 2010).
E-mail
The least official business commendation method is the utilization of the email. This is
the most utilized form of business correspondence usually performed with respect to conver-
sational fashion. Below is an email correspondent letter sample:
Hi Pat,
It was awesome to catch up with you last Thursday.
As I explained, I am seriously searching for a new opportunity in international operations and
appreciate your willingness to forward my resume. Here is a link to my Career Folio:
www.careerfolio.com/paulahmani
PS: The CareerFolio has both text and MS Word versions of my resume, which you may
download as required.
Thanks, Paul!
25
Ahamadu, P.
Global Operations / Business Development
Cell: 555-555-5555
The Essential qualities of Business letters
There are some qualities which are essential for a business letter. It is firstly important
to ensure that the letter serves the purpose for its drafting. For instance, if a manufacturer
writes a commercial letter to a supplier for the purchase of raw materials, it is necessary that
the letter contains all the pertinent information related to required material, the payment
mode, transportation arrangements, quantity packaging, etc. specifically and clearly. Failure
to do this will result in confusion which may result in delays in receiving the materials. It is
also important to consider the quality of the paper utilized in the correspondence, the size, its
color etc., owing to the fact that it creates a positive intuition in the receiver's mind. The es-
sential qualities of a business letter may be classified as: inner qualities; and outer qualities.
Inner qualities
Inner Qualities of a good business letter describe the quality of the language, the
presentation of the letter, etc. These qualities enable rapid processing of the demand and con-
tribute in resulting in rapid actions. Some of the inner qualities of an excellent business letter
are discussed.
Simplicity: the language used in quality letters is usually simple and easy to understand. It is
important to totally avoid the use of complex words, as it is not expected that the reader refers
to the dictionary each time when reading the reading.
Clarity: it is also important to note that the language used must be clear, in order to ensure that
the reader correctly and instantly understands the message immediately it is received, easily
and correctly. The use of ambiguous language results in confusion. The letter will actually
serve its purpose if the receiver comprehends the message in the same way as was intended
conveyer.
Accuracy: it is necessary to ensure that the statements in the letter are accurate to, the best of
the conveyer's knowledge. Accuracy requires that no errors in the language use - in spellings,
grammar, and punctuations etc. Accurate letters are always appreciated.
26
Completeness: The letter must be complete in that it provides all required information to the
readers. For instance, when placing an order one should state the required features of the
product, i.e., shape, quality, color, design, date of delivery, transportation mode, quantity, etc.
Relevance: only relevant information should be contained in the letter. Irrelevant information
should be avoided when sending any commercial correspondence.
Courtesy: it should be noted that courtesy wins the reader's heart. Courtesy may be expressed
in business letters by utilizing words such as thank you, please, etc.
Neatness: Neat letters are always impressive. Whether is typed or hand written, it is important
that a letter is very neat and highly attractive in terms of appearance. Cutting and overwriting
must prevented.
Outer Qualities
The outer qualities of an excellent business letter refer to the letter's appearance. This
comprises the quality of utilized paper, paper color, paper size etc. Excellent paper offers a
positive perception in the reader's mind. It also contributes to the effective documentation of
the letter. Some of the outer qualities of a good business letter are discussed thus.
Paper Quality: It is important to ensure that the quality of the paper utilized conforms to the
company's economic status. Costs of paper are considerably high. Thus, a paper of good qual-
ity should be used for first copy and regular paper may be utilized for subsequent copies.
Paper Color: It is important to utilize different colors for various letter types, in order to help
the reader quickly identify and react to the demands in the letter.
Paper Size: For business letters, a standard A4 should be utilized. The size should also con-
form to the available envelopes in the market.
The packaging of a business letter is also a characteristic which contributes to its for-
mality. When folding the letter, it is important that it is properly and uniformly folded. Care
must be taken to limit the number of folds in the letter in order for it to fit the envelope's size.
If a window envelope is utilized then folding must be performed in a way that the receiver's
address is clearly noticeable via the envelope's transparent section.
27
Chapter Four
Characteristics of business Letters
The main parts of business letters
We have discussed above the qualities of a good business letter. The quality will be
maintained if we give proper attention to each and every part of the letter. Let us now learn
about the different parts of a business letter.
The essential parts of a business letter are as follows:
1. Heading
2. Date
3. Reference
4. Inside Address
5. Subject
6. Salutation
7. Body of the letter
8. Complimentary
close
9. Signature
10. Enclosures
11. Copy Circulation
12. Post Script
1. Heading -The heading of a business letter usually contains the name and postal address of
the business, E-mail address, Web-site address, Telephone Number, Fax Number, Trade Mark
or logo of the business (if any)
2. Date - The date is normally written on the right hand side corner after the heading as the
day, month and years. Some examples are 28th Feb., 2003 or Feb. 28, 2003.
3. Reference- It indicates letter number and the department from where the letter is being sent
and the year. It helps in future reference. This reference number is given on the left hand cor-
ner after the heading. For example, we can write reference number as AB/FADept./2003/27.
4. Inside address - This includes the name and full address of the person or the firm to whom
the letter is to be sent. This is written on the left hand side of the sheet below the reference
28
number. Letters should be addressed to the responsible head e.g., the Secretary, the Principal,
the Chairman, the Manager etc. Example:
5. Subject - It is a statement in brief, that indicates the matter to which the letter relates. It at-
tracts the attention of the receiver immediately and helps him to know quickly what the letter
is about. For example,
Subject: Your order No. C317/8 dated 12th March 2003.
Subject: Enquiry about Samsung television
Subject: Fire Insurance policy
6. Salutation - This is placed below the inside address. It is usually followed by a comma (,).
Various forms of salutation are:
Sir/Madam: For official and formal correspondence
Dear Sir/Madam: For addressing an individual
Dear Sirs/Dear Madam: For addressing a firm or company.
7. Body of the letter- This comes after salutation. This is the main part of the letter and it con-
tains the actual message of the sender. It is divided into three parts.
(a) Opening part - It is the introductory part of the letter. In this part, attention of the reader
should be drawn to the previous correspondence, if any. For example with reference to your
letter no. 326 dated. 12th March 2003, I would like to draw your attention towards the new
brand of television.
(b) Main part - This part usually contains the subject matter of the letter. It should be precise
and written in clear words.
(c) Concluding Part - It contains a statement the of sender's intentions, hopes or expectations
concerning the next step to be taken. Further, the sender should always look forward to get-
ting a positive response. At the end, terms like Thanking you, With regards, With warm re-
gards may be used.
29
The Layout of business letter
It is important to understand the basic layout of business letter which is characteristic
to most written business correspondence letters. This section of the paper presents the basic
layout of a business correspondence letter. During the presentation of a business letter, it is
important that the layout of the letter is arranged properly in an order that it is easy to read and
appears professional. In correspondence letters plain fonts like Times New Roman, Verdana
or Arial should be used.
The layout of a business letter must also be properly spaced, with spaces between the
heading, the salutation, every paragraph, the conclusion, and the writer's signature. The letter
should be single spaced and a space left between every paragraph.
Sample Business Letter Layout
Contact Information
Your Name
Your Address
Your City, State, Zip Code
Your Phone Number
Your Email Address
(space)
Date
(space)
Contact Information
Name
Title
Company
Address
City, State, Zip Code
30
(space)
Salutation
(space)
Dear Mr./Ms. Last Name:
(space)
Body of Business Letter
An introduction of what is written should be presented in the first paragraph of the letter.
(space between paragraphs)
Subsequent, paragraphs should provide additional information as well as details about the
writer's request.
(space between paragraphs)
The concussing paragraph should reemphasize the purpose of writing the letter and thank the
reader for considering the request.
Conclusion:
(space)
Respectfully yours,
(double space)
Signature:
Handwritten Signature (for a mailed letter)
(double space)
Typed Signature
31
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Watson, P. (2005), Ideas: A History of Thought and Invention from Fire to Freud, New York:
HarperCollins Publishers
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