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You’ve either received a job offer or you’re expecting one. How you approach and conduct the salary negotiation are vitally important. Not only will they determine what you’re paid, but they’re also a demonstration of your sales skills to the potential employer.

Rather not negotiate your salary? Consider the data: it demonstrates that failing to negotiate your salary means you will have to work eight years longer to make the same amount as your counterparts who do negotiate. It also costs on average a half a million dollars in earnings by the age of 60. So while you may prefer to avoid a salary negotiation, these stark statistics should make you think twice.

1. Be Prepared

Your salary negotiation actually starts in the first qualifying interview. The recruiter, hiring manager or HR person making the contact is likely to ask what your current salary is or what your expectation is. Many experts recommend simply deflecting the question with a statement like, “I only share that information with my accountant.” You can then shift the conversation to your future expectations. To do that, you need to know your market value. What are successful salespeople in your industry paid? You can find that out by doing some research on sites like Payscale, Salary and Glassdoor. The best time to do this is now, before that first call from a recruiter. You can phrase your response in a non-confrontational way such as, “Correct me if I’m wrong, but my understanding is that people with my skills and experience are paid in the range of $X to $X.”       

2. Extra Research

Once you’re past the qualifying call, you need to know more about the potential employer. Basic facts can be gotten from the internet: Company size, structure and ownership; gross revenues; number of employees; main divisions and products. Through sites like Glassdoor, which includes “reviews” of the company from current and former employees, you may find out about the culture and work environment.  Take these with a grain of salt as many are written by unhappy people who quite or were fired (though perhaps for good reasons). Do you know anyone — maybe on LinkedIn — who worked for that company? Don’t be shy about reaching out to a connection who worked for the company or one of their main competitors in a private message to ask direct questions. Most people are flattered to be treated as an expert and will give advice. You may need to ask your interviewer(s) directly to find out things such as how many salespeople in the company are making quotas, what the average compensation is in their sales force, what their year-over-year sales growth (or decline) has been for the past five years, what the turnover rate is among salespeople. For public companies, much of the financial information will be in their annual report. Read it. This will give you an idea percentage of revenue is spent on sales and a bit about what kind of place it is to work. 

3. Choose a Negotiation Strategy

A study on salary negotiation styles reported in the Harvard Business Review found that there are five basic negotiating strategies: collaborating (engaging in problem solving to reach the best possible outcome for both sides); competing (trying to maximize one’s own outcomes with little concern for others); compromising (trying to reach middle ground); accommodating (putting the other party’s concerns first); and avoiding (dodging negotiation altogether). The study found that choice of negotiation strategy turned out to be the most important factor in determining effective salary negotiation. Those who chose to negotiate salary, rather than accepting the offer on the table, increased their starting pay by an average of $5,000 and most of the “winners”  primarily used either competing or collaborating strategies.

4. Set Your Walkaway Number

Using the research you’ve gathered and your desire to accept a job with the potential employer — which may include considerations such as location, lifestyle and future opportunity — decide the minimum compensation you’ll accept. If the company meets or exceeds that number, great! If they don’t, you can turn them down knowing that you made the best decision for you. 

5. Consider and Counter

When you receive an offer number, ask for time to consider it. Don’t dawdle. A day or two is sufficient if you’ve done your research, and it lets them know that you move quickly and follow up thoroughly — two traits they should be looking for in a salesperson. Your counter will be 10-20% above their offer: 10% if you don’t believe they have a burning need to hire you, 20% if you think they do. Maybe you have a unique experience that exactly fits the role, or you have industry connections they want to tap. Don’t counter by phone. Write an email containing your counter along with a brief but compelling business case justifying the increase. At the same time you’re writing that email, create a negotiation script you’ll use when they call to discuss the offer. Write down their offer, your counter, your walkaway number and your top-three desired non-salary benefits. This will keep you focused during the final stage and — the research says — could get you thousands of dollars immediately. If they’re unwilling to come off their number, consider asking for a signing bonus and relocation allowance to help make up the difference.

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