Negotiating Your Package Can Be a Game of Brinkmanship. But it Doesn’t Need to Be.
Setting a positive tone for negotiating your contract begins with the first communication you have with the company.
Every conversation you have is demonstrating who you are and what you stand for.
Remember that everything you say and do, including all communications, emails, phone calls, interview and contract negotiations, demonstrates the kind of person you are, your professionalism and your worth as a candidate.
Everything you say and do, is an example of your communications skills, particularly how you relate to others, most importantly how you will relate to your future clients.
Your first communication with the company might be on the phone for a quick chat or more formally at interview. Wherever it is, do not bring up the salary for the job, unless you’re asked.
If asked, give a range between what you currently earn and your realistic expectations. Emphasis here is on the word realistic. I’ve known candidates to request their expected salary to be an increase of 50% on their current earnings. Is this realistic? Particularly in this economic climate – but at any time – 50% is ‘in your dreams’ and not realistic.
Please don’t embellish your current or expected salary.
If you embellish your salary expectation you’ll lose the job offer, due to an over inflated perception of your worth. It’s your ego speaking. Leave your ego out of the negotiation or your negotiations will be over before they’ve even started.
Likewise, it’s really important to provide accurate current earnings when asked. I have known candidates who inflate their current earnings – only to be found out – and of course lose the job.
Got your first offer?
When you receive your first salary offer this is the first step in negotiations. Expect that your first offer will be much lower than you thought it would.
Why is it so low?
Because companies tend to make the first offer at a minimum salary rate, hoping that you want the job so badly, that you’ll take the offer. Some candidates aren’t aware of their worth to the company, or what the going market rate is for their salary and may fall for the trap of naively accepting a lower salary.
Don’t undervalue your worth to the company.
I’ve mentioned that embellishing expectations is not appropriate – nor is undervaluing your worth. A good rule of thumb is an increase in salary of upwards of 15 %.
If the salary is offered verbally – please don’t accept – ask for it to be emailed listing all benefits and you can consider and get back to them.
Received your formal contract?
Go through any package offered carefully reading every detail. If you’re not good at detail – as many big thinkers aren’t – get someone else to go through it with you. It is essential you know all there is to know about the contract.
Remember that your salary is only one component of the package. All extras included in the package need consideration too, as these are all included in the bottom line. The total cost to the company, is the bottom line.
Big salary vs big bonus?
Some companies are prepared to offer a lower salary but with a big bonus. I’ve known bonuses to be offered between 10 % and 50 %. If you achieve the results you’re rewarded, if not, you aren’t. This is good for some and not for others. This is good for those who can see that the targets could be achieved, but not so good if the targets are unrealistic.
How do your know if it’s a good option?
Know the market well, do your homework on recent company growth in their market sector. Ask for information on what bonuses were paid in the last couple of years in the company and in which market sections these bonuses were achieved in. Are you replacing anyone in this job? If so, what bonus did they achieve? Why?
Write down all that relates to the package offer, including bonuses and any other extras – then compare with your current package. Calculate the bottom line in each. This is apples vs apples. This is an objective way to compare. It’s an unemotional realistic comparison of each offer.
If yours an expat role, include other built in additions such as relocation, accommodation, children’s school fees, flights home. All of these, and any others related to moving to another country, need to be included in the bottom line.
However, there is more to consider.
- What other benefits are there to gain in the job? It may be a more senior role with increased responsibilities – a good step in the right direction, but the package isn’t what you’d like. Is this offer worth refusing because of the salary? Increasing your skills and experience could be a very good platform to step up your career now, and with great potential. It’s not all about the salary.
- If you’re currently in a small company, is it worth refusing an average offer from a large multinational? The aim for many of my clients is to get into multinationals, as in the long term they offer enormous scope for growing careers both locally and internationally.
The above two points are extras that don’t necessarily add to the immediate bottom line. However, you need to consider these options – or any others that enhance the offer. They’re not providing rewards now but great potential for the future.
Back to the negation table:
After comparing your current package with the offer (keeping in mind all other benefits mentioned above) you’re now in a better position to return to the negotiating table with a counter offer. This offer can now be a considered with all relevant information for now & and for your career in the future.
You have all the information needed, you’ve investigated all that is required for an informed approach to negotiations. You’re in a very positive position. You’re in control of negotiating your future.
How long will negotiations take?
In my experience negotiation can take as little as a week or many months.
The size of the job, or the seniority, reflect the length of negotiations to some extent, but the length of negotiations mostly, reflect the company’s openness and flexibility to offering contracts at or above market rate.
Some companies are difficult negotiators as they want the best talent at an absolute minimum cost. Unfortunately, this works against them in the long run, as they become known in the industry for providing low salaries. The long term outcome for them is that a very small pool of talent is willing to consider a career with them.
Realistically, many recruiters negotiate contracts regularly. But some don’t.
We negotiate all contracts on your behalf. To find out more about what we can do for your career click on the link in this picture or contact me [email protected] We’re happy to help you.