I would like to include dunning letters when mailing out the monthly invoices for my department in order to increase collection efforts. Is this an industry standard practice?

We recommend that you continue to send your dunning letters separately from your current invoices. In general, you increase the likelihood of a customer mistake when you send a mailing with more than one purpose.

Dunning letters typically list the invoice information for the invoices they are attempting to collect on. It is common practice for AR to include copies of the listed past-due invoices with the dunning letter, and AP clerks are used to this practice. If you include a dunning letter with new invoices, you run the risk of the AP clerk mistaking the new invoices for the past due invoices printed on the letter.

Additionally, the clerk who keys in invoices is often a different employee than the one who handles past-due invoices. Even if s/he does recognize that new invoices are separate from dunning letters, there's a chance the letter will not make it to the right person. This true of any mailing sent with dual purposes.

It is, however, common to send a dunning letter with the monthly statement of open invoices. Doing so allows you to inform the customer of the past due invoice without affecting new invoices.

It’s important to note that your final demand letter should always be sent separately via certified mail to ensure the customer gets it and convey its importance to the customer.

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