What is a Business Letter?

LetterLab
Sep 5
4 min read

A business letter is a formal written document typically exchanged between companies, or between an organization and its clients, customers, or other external parties. It serves as a professional means of communication to request information, place orders, address issues, or build relationships, often creating a permanent record that's taken more seriously than emails or casual messages.

Unlike informal correspondence, business letters use structured formats and formal language to ensure clarity and professionalism.

Why Use a Business Letter?

In today's digital age, business letters remain essential for official communications where a formal tone is required, such as legal matters, contracts, or professional networking. They help establish credibility, provide a tangible record, and can influence business decisions. For instance, they are commonly used in job applications, sales pitches, or complaint resolutions.

According to professional writing resources, business letters convey authority and are preferred in scenarios demanding precision and politeness.

Common Formats of Business Letters

Business letters follow standardized formats to maintain consistency and readability. The most popular ones include:

Block Format: Everything is left-aligned, with no indents for paragraphs. Single-spaced text with a blank line between paragraphs. This is the most straightforward and commonly used style.
Modified Block Format: Similar to block, but the sender's address, date, and closing are centered or right-aligned. Paragraphs remain left-aligned without indents.
Semi-Block Format: Like modified block, but paragraphs are indented (usually by half an inch) for a more traditional look.
Modified Semi-Block: Combines elements where the sender's details are indented, and paragraphs are also indented.

Choose a format based on your organization's style guide or the letter's purpose. For example, conservative industries might prefer modified block for its balanced appearance.

Key Components of a Business Letter

A standard business letter includes several essential parts, arranged in a logical order:

Sender's Address/Heading: At the top, include your company's name, address, phone, and email (if not on letterhead). Skip if using pre-printed letterhead.
Date: Written in full (e.g., September 5, 2025), placed below the heading.
Recipient's Address (Inside Address): The full address of the receiver, including name and title.
Salutation: A formal greeting like "Dear Mr. Smith:" or "Dear Dr. Johnson,". Use a colon for formality.
Body: The main content, divided into paragraphs. The first introduces the purpose, middle ones provide details, and the last calls for action or summarizes.
Complimentary Close: Phrases like "Sincerely," or "Best regards," followed by a comma.
Signature: Your handwritten signature above your typed name and title.
Enclosures/Attachments: Note any included documents, e.g., "Enclosure: Resume".

Additional elements might include a subject line for quick reference or typist initials if applicable. Margins are typically 1 inch on all sides, with single-spacing and a professional font like Times New Roman, size 12.

Types of Business Letters

Business letters vary by purpose. Here are common types, based on professional guidelines:

● Cover Letter - Accompany a resume for job applications, highlighting qualifications. (Tailor to the job; include specific examples of skills.)

● Letter of Recommendation - Endorse someone's skills for jobs or education. (Provide concrete examples of achievements.)

● Interview Follow-Up - Thank interviewers and reaffirm interest post-interview. (Reference discussion points for personalization.)

● Offer Letter - Formally extend a job offer with terms like salary and start date. (Be clear on deadlines for acceptance.)

● Sales Letter - Promote products/services to potential clients. (Include a strong call to action and benefits.)

● Letter of Commendation - Praise an employee's performance company-wide. (Highlight specific accomplishments.)

● Resignation Letter - Notify employer of intent to leave.

(Keep positive; mention last day and thanks.)

● Thank You Letter - Express gratitude after meetings or assistance. (Be timely and specific about what you're thankful for.)

● Complaint Letter - Address issues with products/services.

(State facts calmly and suggest resolutions.)

● Apology Letter - Acknowledge and rectify mistakes.

(Own the error without excuses; outline fixes.)

● Office Memorandum (Memo) - Internal updates like policy changes. (Keep concise; use bullet points for clarity.)

● Welcome Letter - Onboard new employees or clients (Convey enthusiasm and provide key info like orientations.)

Inquiry Letter -

● Request information about products or opportunities.

Be specific about what you need to know.

Adjustment Letter

● Respond to complaints with solutions. - Empathize and (detail corrective actions.)

● Acknowledgment Letter - Confirm receipt of documents or orders. (Reassure the sender and outline next steps.)

These types help in various professional scenarios, from HR to customer service. For more on types, see Indeed's guide on business letters.

How to Write a Business Letter: Step-by-Step Guide

Follow these steps to craft an effective business letter:

Research and Plan: Understand your audience and purpose. Gather necessary details like the recipient's title.
Choose Format and Layout: Select block or modified based on preference; ensure professional formatting.
Write the Header: Add addresses and date.
Craft the Salutation: Personalize it to build rapport.
Develop the Body: Keep it concise—one page ideally. Start with intent, provide support, end with action.
Close Professionally: Use an appropriate sign-off and sign.
Proofread: Check for errors in grammar, tone, and facts.

Tips: Maintain a formal yet approachable tone; avoid jargon unless industry-specific. Use active voice for directness. Common mistakes include being too verbose or forgetting enclosures.

Examples of Business Letters

Sales Letter Example: "Dear Ms. Lee, We are excited to introduce our new eco-friendly packaging solutions, which can reduce your costs by 20%. Contact us by October 1 for a free demo. Sincerely, John Doe, Sales Manager."
Resignation Letter Example: "Dear Mr. Patel, I am writing to resign from my position effective two weeks from today. Thank you for the opportunities. Best regards, Jane Smith."

For templates, refer to Purdue OWL's business letter resources.