Salary Negotiation Process: tips that will guide you

In the end, negotiation is often simply about exchanging variables (in proposals) where it is often the case that the variables do not have the same value for the parties at the table.  But doing it in the right order will help your chances of success. 

One good tip is to write down all possible variables and arrange them according to the importance for yourself and the other party. You can learn more about that here.  If you’ve come up with a variable that is less important to you but is important for them, then you might want to place this as an important variable for you too as chances are, the other party is not going to drop it when the negotiation starts.

Also, here’s a table of the salary negotiation process that you can use. We have more tools like these in our negotiation course for procurement professionals, so feel free to check that out.

Salary Negotiation Process

1. Collect information before the negotiation
2. Let the other party propose first
3. Determine your break point
4. Determine your opening bid
5. Ask as many questions as possible
6. If necessary, give out important variables in small details
7. If the deal leads to what is below what you want, then consider your future options

Salary Negotiation for the Currently Employed

All the tips in this article are about salary negotiations for applicants and for the current employees as well. Current employees always find it hard to re-negotiate their pay rates because they either feel ashamed for doing so or they are not prepared to do so, but remember: not asking for anything, won’t ever bring you anything. 

For the currently employed, here are some of the things to consider if you’re aiming to get better pay with your current job and position: 

• Is the salary rate placed in the hiring contract? If that is the case, then the only way that you’ll be able to re-negotiate your salary rate is when you’re going to renegotiate the terms of your contract as well. It will also be legally impossible to change your rate if your contract is still ongoing.
• For those who are currently employed and want to take a shot at changing their rates, you should check your performance compared to the other staff. If you’re a team leader, then how would you rate your team compared to the other teams in the company? If you (or your team) are performing well, then you can certainly justify the need to reward you by upgrading your current salary rate.
• Again, for the currently employed; think about your place in the company. Can the company easily replace you? If your company finds it difficult to replace you because of your value in the company, then you have a shot at negotiation for a better pay rate.
• You should think in advance about what deal you are going to be satisfied with. Think about the rates. Why do you deserve to get such a rate?
• Also, think about the other side of the negotiating table. Do you have any idea about his/her breaking point? Also, think about what deal would satisfy him/her.
• While it is important to make a point, you also need to be careful about how you convince the other side. You can try to convince the other side without having to negotiate, but this always takes confidence and information that your opponent can’t counter.
• If you’re offered a  promotion without a raise, this article will help you.

Salary Negotiation Case Study

Publisher cuts on writers profit % 

Possible strategies

A large publisher wants to cut on personnel costs: they have sent a letter to all their writers that the profit % per sold book from now on, drops from 20% to 15%. 

What to do? 

If – after pushing back 10 times on your part – it turns out in this negotiation that the publisher must necessarily go to 15% and otherwise cannot close a deal (their goal is: equal % for all employees), you can negotiate the hard or the creative way.

Hard tactics: this is only possible if you are 100% sure that the company relies on you and you & your colleagues are therefore irreplaceable: say that you stop and switch to another publisher if they can change the 20% (can also be a great opening bid by the way). This is going to cause a huge amount of stress on the other side of the table, but this tactic can only work if you know that they are not going to use it against you.

Creative tactics: if the hard variant as outlined above does not work, I would first ask how they want to compensate you for the fact that you as writers of this publisher do so much better than the other branches. However, think for yourself with your colleagues how you would like to organize this route because talking about proposals instead of cannot and/or no’s, always works best. For example, a deal where you achieve something (17% for everyone) in combination with a fixed 3% because of your good performance – could be a route. 

Or they can compensate you in 20 other ways. Can they internally state that all writers have 15% as a profit percentage, they can also give new people who start 15%, but as long as you and your colleagues do this work, you keep the current conditions, or do you now set up the system completely differently because the negotiation is already open anyway? There are countless examples of how you would set up the current system, but always let them come up with a proposal.