It's been weeks or months on the job hunt and your search is finally coming to an end.
You've gone through all the hoops and whistles and you finally have a job offer in had.
You're even excited about the role and can't wait to start ASAP.
There's one last thing to do, though, and it's crucial to your career success that you do it right: negotiate the job offer.
Millennials are making the costly mistake of not negotiating their starting salaries, which inform future pay increases and result in higher lifetime financial gains.
But no one has ever taught you how to negotiate and, anxiously, you fear that making any overt demands for high pay and excellent benefits might alienate your potential, future employer just as you want to seal the deal.
This couldn't be further from the truth. And it is this type of thinking that leads many Millennials astray.
Employers actually expect you to negotiate. The issue is nailing down the how. With proven steps, proper preparation, and well-practiced communication, anyone can negotiate a job offer like a boss.
Step 1: You got to do the research
The salary research, and the information you find, will be used as leverage in the negotiation. Realistic, credible data must be used to back up your value proposition, as your future employer will expect you to know what your skills and talents go for in the free market.
Your geographic location
Your years of experience
The title of the job you'll be entering
If you're one of those Millennials with a cool new title like Growth Hacker or Director of Happiness, and scant data exists, you might say to yourself:
"There's no data to back up my role as it's too new..."
If that's the case, don't fret. You can negotiate instead based upon a variable "what is my value and the return on investment I'll be bringing to the company" mindset.
It's a bit harder to negotiate from here, as it requires trust and transparency with your potential employer, but it can be done.
If it's an early stage startup, most likely they aren't able to pay you a lot. But as the venture grows, and becomes more successful, hopefully they can.
You should write an agreement that reflects that understanding. Sliding scale salaries are nothing new. Given the risk you'll be taking on, and the low starting salary, you could also negotiate for equity of the company.
Remember, it's all based upon the value you're bringing and, as I like to say, everything is negotiable.
Step 2: What's the lowest number you'd be willing to accept
Your research will define your salary range, which also tells you the lowest number you're willing to accept.
This will be known as your walk away point.
As your floor, your walk away point anchors your expectations during the negotiation process so you don't inadvertently take a deal that is lower than what you would expect.
And, should your employer quote you a number lower than that, your job is to bring them up. If they cannot, you simply walk away - simple as that!
Employers have this tactic, though, for trying to figure out what is the lowest number they can offer you: asking you what you previously made. The logic is that what someone paid you before for your skills is in the ballpark of what you will accept now.
Usually it's 10-20% of what you previously made.
Most people believe they have two options when it comes to answering that question in a interview:
"I need to give up that information because, if I don't, I don't want to disadvantage myself and not get the job. They may even think I'm hiding something."
Actually, you're under no obligation to give out that information. It's your own personal financial history and it should stay that way. While there are some exceptions to this, like if you're in a commission based pay scale, the moment you give up this information you significantly decrease your negotiation leverage. And you really don't want to do that.
Or people think this is their other option:
"I should just lie and say I made significantly more than I actually did, right? Because how are they ever going to find out?"
Well, not only is that unethical but it can also be illegal and grounds for dismissal from the company later on if they ever found out. Do you really want to start off your employer-employee relationship with a lie? Trust me, it's not worth it.
Instead of using either response, why not reframe the question back to your research and value proposition while staying honest:
“I’m actually not comfortable giving out that information. I will tell you that I have been looking at roles in the 50-60k range and I believe that is the value I’ll be bringing to the company. So far, it seems like this is a great fit for both of us. If that makes sense to you, I would love to continue the conversation and we can negotiate the particulars of the deal when the time comes. What do you say?”
Basically you're punting the salary compensation question to later.
Once you've received a job offer, and there is no doubt that you want to go forward, the employer will have every incentive to engage in a meaningful conversation regarding your salary requirements and benefits.
Step 3: Learn whom you'll be negotiating with
One of the first things I tell clients is that people make deals, not companies.
The person you'll be negotiating with, as well as the people you've been conversing with throughout the job interview process, will ultimately be the person that says yes or no to a deal.
Take for instance Disney's Purchase of Lucasfilm and the behind-the-scenes negotiations that allowed the $4.05 billion deal to go forward:
"According to Walt Disney Chairman Robert Iger, a famous negotiator in Hollywood, he and Lucas conducted the negotiations personally, beginning in early 2011. Speaking of Lucas' decision to hand over his creative legacy to Disney, Iger told the New York Times, "There was a lot of trust there."
This took about a year and a half to build. For Iger and Lucas to forge the billion-dollar agreement, the people dimension of creating trust and confidence in the relationship was what ultimately helped seal the deal.
So what does this have to do with your salary negotiation?
Whether you're negotiating with an HR representative, your next boss, or an executive of the company, you have to try and understand their constraints and interests within the negotiation and build trust along the way:
HR might not have that much latitude in terms of the salary they can offer you but could be flexible with benefits and perks to sweeten the deal.
Your potential boss may not want you to nitpick every last detail over the offer, but could be flexible on salary and other perks.
An executive could offer lucrative perks, equity in the company, and travel benefits but their time is precious - so don't waste it - and will want a deal sooner rather than later.
Come prepared and build that trust along the way; it might just be what you need to secure an agreement you'll be happy with.
Step 4: Remember that the negotiation is a dance
Like any good dance, there are a number of moves either partner can do that can make themselves and the other look good. One person will lead (most likely your future employer) and the other follows (i.e. you).
You'll need to come prepared with different moves that leave your leading partner happy, but that also satisfy you.
Think creatively of the different incentives the employer could offer you to sweeten the deal. These include:
Flexible start dates;
Increased vacation time;
A one-time signing bonus;
Flexibility in work hours;
Opportunities for growth/promotion;
Support for continued education;
If you're looking to get a starting salary of 65k but your boss says that he can only come up to 62.5, cut your losses and take it BUT look for other ways that they can sweeten the deal and bridge the gap:
Perhaps after three months of employment a one time signing bonus of $2,500
Maybe they can offer you a one-time tuition credit for continuing education of $2,500
Or maybe even a salary review in 6 or 12 months from the start date of your employment.
When an impasse occurs, think about what incentives to use that leave you happy with the deal.
Step 5: Always look at the big picture
You've made it this far in the process and your potential employer obviously made you an offer because they want you.
What wonderful news!
So don't waste their time or energy haggling over the small stuff if it isn't that important to you.
Show them you mean business. Rank the issues that are important to you from most important to least. And, when you begin the negotiations, tell them which are most important to you.
One of the worst mistakes you can make is not letting your potential employer know what is most important to you. There's only so many moves that the other side will make in a job offer negotiation, and after one or two concessions they'll most likely think their work is done and give you a modified offer that may or may not include those important issues.
However, you also have to go in knowing that you might not get everything you want.
And that's okay!
Part of being an adult is learning how to trust when a good deal is presented to you that offers room for growth and opportunity, a great working environment, and other attractive benefits.
So meet your potential employer halfway.
Learn to gauge for yourself what is important, when to drop an issue, and how to stay firm but respectful with what you want. Trust me, your potential boss will respect you a lot more if you come in with this attitude and don't resort to the entitled Millennial stereotype that is so vehemently thrown at us.
Most importantly, though, is that the end result should leave everyone happy - including you.
Bottom Line: job offer negotiations can be tense, and for Millennials with no experience in negotiation they can be downright stressful. That's why through this five-step process you too can negotiate that job offer like a boss. All it takes is a bit of preparation, some trust, and understanding it's a give and take process that requires everyone to leave happy. Happy negotiating!