You’ve recruited the perfect candidate to fill a client’s job. They have the skills, the right attitude, and they’re ready to move. You’re down to the final item on the list: salary. Get it right and you can wrap up a job well done. Get it wrong and you may be starting over with a new candidate.
Your time is valuable. You can’t afford to waste it. Here are the key things you need to know when it comes to negotiating salary.
Be Prepared
Your clients are coming to you because you have expertise in finding, assessing, and bringing quality candidates to the table. You need to do enough research to live up to their expectations. That means having a firm grasp on the current marketplace as far as talent and salary. You also need to have enough conversations with your client to know their bottom line.
If the money they are offering isn’t enough to get the candidate they want, you need to let them know – and back it up with numbers. Many companies are still approaching hiring as they did 10 years ago when there was a bigger talent pool. For job candidates, it’s currently a seller’s market. 86 percent of the most qualified candidates are not actively looking for a new job. Finding them and attracting them to make a switch takes a different approach and possibly a different compensation level. You need to make sure your client understands that, and you manage their expectations.
Probe for flexibility in salary and non-cash compensation. You want to have a firm understanding of where the company will negotiate and what is not possible. In essence, your salary negotiation starts with the client before the candidate.
Timing It Properly
Great recruiters know timing is critical when negotiating salary. If you ask too soon, you run the risk of driving strong candidates away before they know what the job is all about. Don’t use salary too early in the interview process as a way to weed out candidates. You may think it will save you some time, but you may lose some of your best prospects. Using salary is a filter may also cut short what could be valuable conversations that can build a relationship. Even if the fit turns out not to be right, you never know when your next recruiting mission might be the right one for this candidate. That relationship can be important for the future or for getting valuable referrals.
Save the salary talk until after you’ve built a relationship and sold the candidate on the job itself. After all, it’s really not just about the salary. Career growth, challenges, flexibility, benefits, vacation, perks, incentive plans, and bonuses all play a role. Remember to think of it as a total compensation package. While candidates will initially react to the salary, there is real value to the other parts of the package.
Use Trial Closes
Trial closes tell you where you are in the “selling” process and when it’s the right time to ask for the sale. In this case, closing the deal with a candidate. Sales experts use this strategy consistently during the sales process.
You should be seeding your interview process with a series of trial closes. A trial close is a diagnostic tool used to assess a candidate’s interests and where they place value. An example of trial closes might be after discussing a company’s great benefits package. For some people, it might be a key component. For others, it may not be a consideration. Asking an open-ended question about what they think about the benefits package can help you gauge how valuable the candidate thinks it is.
After describing the position and the opportunity, you might ask something like this: “A lot of candidates tell me this position sounds like a really exciting opportunity and that it will further their career. How would you assess it?”
Knowing which parts of the total job package they value can help you properly frame an offer. Before you ever get to salary, you want to get buy-in and acceptance to various pieces along the way. If there is an objection to the salary offered, you need to find it and attack it.
Sell The Intangibles
When thinking about how to negotiate salary, remember that 90 percent of candidates are willing to trade some portion of their salary for more meaningful work, according to a study done by the Harvard Business Review. In a survey of 2,000 workers, workers said they would be willing to give up an average of 23 percent of their lifetime earnings if they believe the job would provide meaningful work and they could make a difference. While that doesn’t mean they would take a job offer that’s 23 percent less than market value, it does show that the intangibles in a job are important.
In a survey of 2,000 workers, workers said they would be willing to give up an average of 23 percent of their lifetime earnings if they believe the job would provide meaningful work and they could make a difference. While that doesn’t mean they would take a job offer that’s 23 percent less than market value, it does show that the intangibles in a job are important.
Can you position the job in a way that provides meaning? If you can frame the opening in the right way, this can be a powerful tool.
Try Taking Salary Out Of The Equation
Before making an offer, an effective technique for recruiters can be to remove salary from the package. You might ask the candidate something like this: “Assuming we can put together an acceptable salary package, would you take the job.” Another way to phrase this might be: “Let’s take salary out of the equation for a moment. After everything we’ve discussed, would this be a job you would want?”
Listen carefully to the response. If the answer isn’t a quick yes, there’s likely an issue you haven’t addressed yet or an objection you haven’t overcome. If they hesitate, it typically means there’s something else you don’t know. You’ll need to dig in and find out what it is. In recruiting, it’s not uncommon for new information to be uncovered during this stage. Rushing to the salary negotiation risks missing this critical step.
If the answer is no, you need to immediately find out why. There may be a competing offer that you need to know about. There may be concerns the candidate hasn’t brought up previously that you can address. If you narrow down the no to a particular issue, you may be able to counter their objection. For example, if they express concern about lack of upward mobility, you may be able to point out that the last two people in this job were promoted within the company.
Emphasise Non-Salary Compensation
If the company you are recruiting for has special perks or unique benefits, it can be effective to hold one or two of them to the end. If you sense there’s a hesitation on the salary, adding in an additional benefit may help mitigate that. “Did I mention that company allows employees to work from home two days a month?” you might ask, or “I’m not sure I mentioned this, but the company does a retention bonus once you complete your first year of employment.”
Presenting The Final Offer: How To Negotiate Salary
Before presenting a formal offer, you want to get acceptance on each aspect of the total package. Getting a verbal yes is the last step before laying it all out. This allows you a final opportunity to tackle any objections.
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