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Say I receive an offer letter from a potential employer. They state clearly the offered salary, and I have a good idea how to value the benefits. With all that, it's less than I'd like.

How can I successfully negotiate the salary upwards? How long should I wait? What language should I use?

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This question might be more suited for careeroverflow.com. –  Ether Aug 16 '10 at 16:50

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up vote 14 down vote accepted

There is no proper way, but I think you have decide before you even try what the minimum you will accept for the job and be ready to decline the offer if you don't get it.

Further, don't just go into the conversation with the attitude "I want more money, give it to me." Be ready to restate your qualifications and the value they will provide to the organization. You have to justify why you are worth more than they are offering.

For example: "As we discussed in the interview, I raised sales by $100K in my last firm in the first year. With that in mind, an additional $10K in your offer seems very reasonable, what do you think?"

As someone who has been on the employer side of this conversation, I can say that one of the most annoying things you can do, and I see it a lot, is ask me whether my number is negotiable. Of course it is, but depending on what else I have lined up and how badly I want to hire you, it might not be for you. It is just a silly question and makes you come off as a weak negotiator that can easily be taken advantage of. I usually just say "no" when people ask this. It's not like I can't back off on this position later on if they actually do try to walk away from the deal.

Best advice, come up with a good justification/story about why you are worth more, and ask for a specific number.

Update:
As requested in the comments, here is a generic guide to negotiating successfully. Here's one specifically geared towards salary negotiation.

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Having said that, though, the offer would have to be truly awful to turn down in this economy. Bird in the hand and all that. –  mbhunter Aug 13 '10 at 6:48
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@mbhunter - It depends on the position of the job hunter. For someone out of work or under employed, I would agree. For someone looking to switch jobs, the offer may be just too low to make it worth moving. It is always a good bargaining position to be in when you don't need the job. –  KeithB Aug 13 '10 at 13:48
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Precisely. The whole point of negotiating is the fact that you are willing to turn them down. If you are out of a job, the odds are you won't turn them down without a really good reason. If you're out of work, only haggle if you absolutely have to or if you believe you can get a bump. If you still aren't satisfied, accept the job and keep looking. Being employed, i.e. not desperate, will give you a much stronger stance when further offers come your way. –  theo Aug 13 '10 at 16:24
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Okay, so say I do my research and conclude that I deserve $10K more than they are offering. Is it really appropriate to say it the way you have given? That seems more like a speaking tone, and I am communicating mainly by writing email. My concern is with things like how to say it, whether to reply immediately or wait a week, etc. –  Anonymous Aug 14 '10 at 0:06
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It's negotiation, so all the best practices for negotiation apply. You're much better doing it face-to-face or with IM or other immediate communication tools than over email. You should have done your homework and have facts to back you up, and you should have objective or independent metrics to base your negotiations on. This means salary surveys and knowing what other people in similar situations make. –  lucius Aug 14 '10 at 8:02

Is the existing offer low because the employer's expectations aren't realistic with respect to the position and salary range, or because you are much better than the average employee for that position and the hiring manager has failed to recognize how wonderful you are?

Whatever the answer is, that tells you what you need to address - e.g., explaining how/why the market is not what the employer thinks it is, or why you're so special that you ought to be paid above average wages for the position.

Neither of those is necessarily an easy sell, but you should at least be able to identify the basic difference between your view of the situation and the employer's.

Also, make sure you really want what you're asking for - when a candidate wants to negotiate with me to come in at the top of the salary range (or beyond), if I agree to the higher number, I will have correspondingly increased expectations regarding productivity and reduced time to get to that level of productivity after starting. If you're going to ask for more than what's standard, you had better be prepared to give more value than what's standard.

When money gets tight, the people whose perceived value is low relative to their perceived cost will get let go first.

It might be better to have a job at 90 or 95% of your desired salary where you're performing at your employer's expectations and your job is not at risk, than a job at 100 or 110% of your desired salary where you're in a constant struggle to justify your continued employment.

Also, your salary needs to make sense in the context of the other people in the organization - if you are going to ask for more than your supervisor makes, you'd better have something really special going on. It also might be political suicide for you (or your supervisor) to cross some unknown (to you) line in the sand related to someone else's salary. I remember sitting in on an interview when some random sales monkey announced that he expected to be paid an amount that was around 2x what our CEO was making, and after a good laugh all around the table the interview ended more or less immediately, to the great surprise and disappointment of the sales monkey. What the sales monkey wanted was probably reasonable for a really good salesperson on a commission/performance basis at a big company - but it was ridiculous for a fixed salary for a new hire at a 15-person startup where everyone assembled their own particle-board desks and wore jeans to work.

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A very nice treatment of the topic. Being a realistic about expectations is an important notion for many things in life. –  George Marian Sep 4 '10 at 19:21

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