5 Tips to Renegotiate Your Salary

5 Tips to Renegotiate Your Salary Successful salary renegotiation is a complex, multistep process that takes some time. Employees who walk into their boss’ office and baldly ask for more money leave the meeting empty-handed and afraid of losing their job. In reality, roughly 70% of the job seekers whom we encounter are currently being paid less than they are worth and could successfully renegotiate their pay. However, the overwhelming majority avoid renegotiating their salary because they don’t accurately gauge their value and/or they wish to avoid a potentially a contentious conversation. When approached intelligently and methodically, salary negotiation is rarely contentious and is often successful. Consider the following 5 tips: 1.  Measure your value: One of the most frequent mistakes that employees make is that they use competing job openings in order to determine their value. This is not an accurate gauge because it fails to take into account human nature: people are most concerned with themselves. In order to determine whether your request will be met with agreement and how much to ask for, you’ll have much better luck when you consider the metrics listed below (if your employer is smart, this is what they’ll think about, too): The demand for your job. The more people who want your job, the less leverage you have at the negotiation table. The difficulties that the company or division (as well as your direct boss) would endure if you left. For instance, when a sales rep leaves, a company has to notify both current and prospective clients of the personnel change, which often is a highly unpleasant activity. Company recruiting capabilities. In most instances, firms with robust recruiting efforts are less likely to agree to high salary increase demands.  If your boss is going to have to spend countless hours digging through resumes themselves, then they are more likely to agree to your raise. Company profit margin. Revenue generation is only half the story. Estimate how much of each dollar brought in is retained by the company and how much goes to their operating expenses. Company cash flow. Companies are just like people. When they have cash, they are much more confident in spending. 2. View your employer’s perspective: In order to be persuasive, it’s necessary to step outside of your own shoes and begin to see the world as your boss sees it. The more you say the phrase “I want,” the less you chance you have of reaching your goal. Instead, talk in terms of their needs. Taking the time to do so will help you formulate a more convincing argument and anticipate rebuttals. 3. Draw out a logical argument: It’s in your best interest to focus on past performance and future potential. If you attempt to leverage possible job offers (or use competing job openings), your negotiation may be perceived as a threat. 4. You’re in control if you make your boss feel in control: People don’t respond well to pressure. Although you may want a decision made on the spot, he or she won’t respond well to pressure. It’s both fair and in your best interest to give your employer time to think about your request. Conversely, leaving it open-ended is not advantageous, either. Kindly asking, “Does a week give you enough time to assess everything?” allows you to set a relatively firm deadline without being contentious. 5. Use time to your advantage: Make a request for the meeting via a respectful email. Doing so is advantageous for a multitude of reasons. First, you show respect your boss’ time (when people feel you don’t appreciate their time, they are less likely to be persuaded by you). You also receive a focused audience. Remember, you are there to discuss a raise, not compete for your boss’ attention. Each time that person diverts their attention to an unrelated call, text messages or email when you spring the question in an unscheduled meeting, you become less persuasive. When it comes to time of day, most individuals are more readily persuaded in the afternoon hours. Mental fatigue depletes willpower. In the end: People who know how to negotiate are paid more for no other reason than that they know how to negotiate. Just like in anything else, proper preparation and intelligent execution yields results.