1.
Commercial correspondence

2.
• UNIT- I Communication – Meaning – Definition – Process/Element –
Principles of effective communication - Importance – Modern
communication devices – Barriers of communication – Measures to
Overcome the Barriers.
• UNIT – II Structure of a business letter – Kinds of Business Letters ––
Letter of Enquiry – Quotations – Offers – Order letters – Trade
Reference - Execution of order – Cancellation of an order.
• UNIT – III Complaint letters – Adjustment and Settlements – Circular
letters.
• UNIT – IV Collection letters – Series Of Collection Letter – Sales
letters – Three P’s of Sales Letters – Functions of Sales Letters.
• UNIT – V Banking letters – Importance – Principles – Functions of
bank – Asking for Overdraft and Loans – Correspondence with Head
office and Other Banks - Status enquiries – Replies and their types –
Bank references - Job Applications .

3.
“Communication is an exchange of facts, ideas,
opinions or emotions by two or more persons”.
“Communication is the process of passing
information and understanding from one
person to another… It is the process of
imparting ideas and making oneself
understood by other”.

4.
Objectives of communication
• To give and receive information
• To impart education and training
• To motivate people
• To provide counseling
• To persuade people
• To receive suggestion
• To improve morale
• To provide advice
• To issue warning
• To appreciate
• To issue orders

5.
Characteristics of communication
• A sender and a receiver
• 2 way process
• Ongoing process
• Feedback
• Pervades all human relationships
• Mutual understanding
• To elicit actions
• Goal oriented process

6.
Need for communication
• To develop mutual trust and confidence
• Information is the bloodline of business
• Effective and efficient system of communication
• Public relations
• Education and training- all types of education
takes place by communication
• Effective communication means effective
coordination
• Exchange of ideas
• To reap success

7.
Barriers to communication
Sender of the message
Communication barriers
1.Noise
2.Time and distance
3.Interpretation of words
4.Inattentiveness
5.Premature evaluation
6.Unclarified assumptions
7.Status block
8.Closed mind
9.Organisational barrier
10.Resistance to change
Receiver of the message

8.
Overcoming the barriers

9.
Types of communication
Types of
communication
External
communication
Internal
communication
Formal
communication
Informal
communication

10.
Media of communication
Media of
communication
Verbal
Oral Written
Non-verbal
Visual Audio

11.
Unit-2
Kinds of letters
• Private letters
• Business or commercial letters
• Official letters

12.
A good business letter can
• Attract new customers
• Bring back lost customers
• Sell goods and services
• Adjust complaints
• Open new markets
• Encourage dealers
• Create goodwill
• Collect bad debts
• Act as a messenger
• Compromise disputes

13.
STRUCTURE OR PARTS OF A BUSINESS LETTER
• The structure of a letter constitutes different parts.
• The parts of a letter have customary places in official letters. Business
letter has some prescribed and some customized or optional parts. The
writer should be familiar with these different elements and also their
positioning in the letter.
• The usual parts of the letter and the customary places are listed and
explained below.
1. Header
2. Date and reference number
3. Inside address
4. Attention line
5.Salutation
6. Body of the letter
7. Complimentary close
8. Signature
9. Reference initials
10. Enclosures

14.
Kinds of letters

15.
Stages of correspondence between a
buyer and seller
• Letter of inquiry
• Letter of response
• Letter of order
• Letter of execution of order
• Letter of complaint
• Letter of adjustment
• Letter of settlement of accounts

16.
Letter of enquiry
• Solicited enquiry
• Unsolicited enquiry
• Description of goods
• Price,time,place
• Terms of payment
• others

17.
Offers and Quotations
• Both the terms "Offers" and "Quotations"
convey the same meaning, but there is a
slight difference between the two.
• Quotation is supplied in reply to an inquiry.
• An offer can be made to a large number of
customers in the form of general terms and in
the form of printed circular letter.

18.
Terms used in Offers and Quotations
1. Loco Price Quotation
Loco means 'On the spot'. Therefore, the loco price refers to the cost of goods at the
factory or godown of the seller. Once the goods are out of the sellers' factory or
warehouse, all the expenses for carrying the goods from the seller's warehouse to the
buyer's place are to be borne by the buyer. This is the lowest price quotation.
2. Station Price Quotation
Under this quotation, seller's responsibility is to send the goods to the nearest railway
station from his warehouse. It includes the cost of carriage of goods to the station.
Since he delivers the goods upto the station, he charges a little higher price. All further
expenses on goods such as freight, insurance, etc. have to be borne by the buyer.
3. Free On Rail (FOR) Price Quotation
Free On Rail (FOR) price quotation covers the expenses of carrying the goods to the
railway station nearest to seller plus the loading expenses, freight and unloading
expenses are to be borne by the buyer.
FOR price quotation = Station price quotation + Loading Charges

19.
4. Cost and Freight (C & F) Price Quotation
Cost and Freight (C & F) price quotation includes the cost of the
goods and all the expenses like carriage to the seller's nearest
station, dock and loading charges and freight. Expenses like
insurance, unloading and cartage to the buyer's place are to be
borne by the buyer.
C & F price quotation = FOR price quotation + Railway Freight.
5. Cost Insurance and Freight (CIF) Price Quotation
There is a risk involved in transporting goods and this risk is covered
by insurance. Generally, the buyer pays insurance charges but if CIF
quotation is mentioned then the seller pays for the insurance
charges along with other previous mentioned prices. So, the price
includes cost of the goods plus carriage upto seller's nearest
station, loading, freight and insurance charges.
CIF price quotation = C & F price quotation + Insurance.

20.
6. Franco Price Quotation or Ex -warehouse
Franco price quotation is the highest price quotation. Inspite of being the highest
quotation, buyers prefer this quotation because under this price, the goods are
delivered to the buyers at their door-step. The buyer is relieved from the tension
of transporting goods from the seller's warehouse to his own warehouse.
Franco price quotation = All expenses upto the buyer's warehouse.
7. Free Alongside Ship (FAS) Price Quotation
Free Alongside Ship (FAS) price quotation includes the cost of the goods and all the
expenses to deliver the goods at the dock nearest to the seller. The buyer has to
bear the expenses of loading, insurance, freight and the customs duty, etc., in
addition to the cost of goods. Though this quotation is used in some countries, it is
not in use in India.
FAS price quotation = Loco price quotation + cost of carriage of goods upto the
harbour nearest to the seller.
8. Free On Board (FOB) Price Quotation
Free On Board (FOB) price quotation is similar to FOR in inland trade. This is
normally used in foreign trade. Under FOB quotation, the seller quotes a price
which includes all the expenses incurred untill the goods are actually delivered on
board the ship at the port of shipment.
FOB price quotation = cost of goods + expenses upto goods on ship's board.

21.
9. Cash With Order (CWO) Price Quotation
In Cash With Order (CWO) price quotation, the
buyer has to send cash along with the order,
otherwise, the order may not be executed.
10. Cash On Delivery (COD) Price Quotation
In Cash On Delivery (COD) price quotation, the
buyer has to pay cash after receiving the delivery
of the goods ordered by him.

22.
• 3% 10 days
• Guarantee
• Cash discount
• Trade discount
• Gross weight
• F.O.R
• Carriage paid
• Carriage forward