A letter of dunning is a letter that lets customers know what their accounts receivable balance is and demands payment. There are two basic reasons why some distributors prefer to send statements in letter form.

 

First, letters are more personalized than statements. Customers see their names as well as a nice message in the introductions and conclusions. In this way, it gives the appearance that someone typed the letter specifically for them so they are more likely to read it than a pre-printed statement.

 

Second, because they print on plain paper, letters of dunning are usually less expensive than having to purchase pre-printed statements.