Offer Negotiation: A Few Thoughts

Congrats! You’ve made it through the interview process and have an offer on hand. If you’re lucky, the offer will be every thing you want it to be and you’ll want to sign as soon as you get the paper. Chances are however, there will be something about the agreement that won’t fit your expectations and you’ll want to negotiate.

If the offer isn’t perfect, it’s important to decide what you want to negotiate. Remember that an offer isn’t just about the salary a company is offering to pay you. Offers also consist of your title, your health and PTO benefits, your working schedule or location, and equity. Maybe the cash offered meets your minimum but you think this job will require more work than your current one and you think this warrants higher pay. Or maybe you’re moving from a new city and want more relocation assistance. Or you’d like to continue to consult on the side. Or maybe the start date won’t work.

Of equal importance is a gut check. Yes, you went through an entire interview process and are interested in the company but…do you actually want to work for them? If your gut says “no”, it might not make sense to waste energy on trying to negotiate.

Ask yourself if you can negotiate, aka the Laws of Supply and Demand:

Before going back to the company, it’s also important to remember that the labor market is governed by supply and demand. If there is a big supply of a certain skill set in the market, or a low demand for a certain skill, employers don’t have to pay top dollar for that skill. They have a ton of other people they could potentially hire if you decide not to take their offer. Conversely, if the demand for a skill set is high and the supply is low, employers will be willing to pay top dollar to convince a candidate to come work for them. If this you, congrats: you have a lot of negotiation power.

I know that it stinks to think about yourself in economic terms, but asking yourself hard questions about where you sit in the market will help set your expectations prior to negotiating.

Managing the Negotiation Conversation:

If you decide you want to negotiate, here are a few guidelines:

• First thank the recruiter and the team and definitely mention that you’re excited about the offer for X,Y,Z reasons…then outline what you’d like to see changed. Leading with positive reinforcement helps set the right tone.
• Don’t go back to the company or the recruiter with a laundry list of items you’d like to change. Pick one or two things that you truly care about and focus your negotiations on those.
• Include details as to why you are asking for something. Providing your thought process and reasoning is useful information for the recruiter; they may not agree with your reasoning but at least they have the context.
• Make sure you have realistic expectations. If you’re making a lateral move, going to a smaller company, or considering a complete career switch, you shouldn’t expect to see a large increase (or any increase) in salary.
• Make sure to mention, and negotiate on, life things like an explicit WFH schedule so you can care for children. Getting these in writing prior to starting at a company ensures there won’t be any future confusion.
• Understand that it might not make business sense for the company to negotiate specific things. A good example for the startup realm is a Non-Compete Agreement; the terms contained in this document are usually determined in conjunction with the board and require a long, arduous process to change. The company probably won’t want to budge much on this document even if you’re a stellar candidate.

Remember, you can always walk away:

You may run into an employer who won’t budge on something that matters to you. Maybe they’ve offered you a salary that is far below your “need to pay rent” number. Or maybe they have an ironclad policy against moonlighting and this would mean you have to shut down your consulting business.

In cases like these, it may make the most sense to decline the offer. And if you do walk, be sure to be gracious, thank the team that interviewed you, and let them know why you are turning them down. Sometimes the same company may come back to you with future opportunities (that align with your comp needs) so it’s best not to burn bridges.

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