When negotiating a new job, everyone wants the highest salary they can get. But most employees do a terrible job negotiating. Many people simply accept whatever salary offer is given. And employees who want more usually do such a poor job that they receive minimal additional compensation. I think 2 issues drive this negotiating ineptitude: fear and lack of know how.

Fear. I get it, you’ve just been through an intensive interview process, perhaps with many companies. The last thing you want to do after you receive a job offer is sour your new employer. But try to see it from your employer’s perspective. They have also endured a lengthy and costly process to find the right person for the job – you. They also don’t want to blow it. And depending upon the position, they may want you more than you want them (even in scary economic times).

Now let’s address the know-how mechanics of the process, or “What to do”:

Acknowledge the Offer
Unless you have a good indication of what the offer is before you receive it, I would not start negotiating the salary immediately after you receive it. The employer has had all the time to formulate the offer and plan. You should give yourself the same time to think about it. Thank the employer for the offer and ask if you can think it over for the afternoon or until the next day. Set up a follow up phone call – this is when the negotiating will happen.

Assess (yourself and the situation)

Is this a fair offer? Why do you want more (other than everyone wants more?)

How much do other employees performing similar work at the company or at competitors earn?

This is where Jobnob salaries come in handy. (Yes, a little self promotion never hurts.)

Can you ask friends or other co-workers who had similar roles what they earn? While you may feel uncomfortable asking, it really does help employees to share their salary information. Employers try to dissuade this behavior, but really only for their benefit. Knowledge is power.

How challenging is it for the company to fill this position? Does this require precise knowledge e.g. SAP Business Warehouse Architect or is this a generic job like customer service rep or marketing coordinator. You’re clearly in a much better position in the former, and may have no negotiation position in the latter.

How banded is the job salary range? This is very company dependent. Small companies usually have much more flexibility in what they can pay, as you may be the only person in this position. This benefits you greatly. Larger companies have very specific salary bands they can pay for a specific role, which can severely limit the hiring manager’s flexibility. But even in these strict cases, there is still a range. You can be at the top end of the range (see the Product Manager salary ranges for over 200 companies).

In part 2, I will discuss compensation strategies and how to ask for more.