When you tried to negotiate for more money – a raise at your existing employer, a higher offer at a new employer – did you stop when the employer said they just can’t pay any more? At a recent negotiation workshop, one participant insisted that he caved because the prospective employer had no budget. Another participant decided not to negotiate at all because he heard his target employer was hiring more junior, less expensive people. In both cases, the candidate took a constraint for the employer as immutable fact, when it is never that cut and dry. Even if the other party says they can’t pay, they still might. Here are four ways to counter the “no budget” negotiation play:
There is no "can’t." There is only "won’t." So find out why.
The other party might sincerely believe there is no budget. They could have no authority to go higher. They could have pressure from their boss or HR to stay below a certain amount. However, it doesn’t mean that everyone else in the company is similarly constrained. Therefore, every time you hear no, find out why not. Every time you hear “cannot” recognize they are really saying “will not” – companies absolutely can and do make exceptions, so find out why they will not make one for you. One of our clients politely asked why the salary couldn’t be raised and was told that the budget for the year was already closed. Turns out, it would re-open in six months. Our client negotiated for a pay adjustment after six months instead of having to wait the full year. It’s not the same as more money right now, but offering to wait and therefore remove the company’s constraint to paying more is one way of turning a no into a yes. Find out what the constraint is, and solve for that.
There is never only one budget.
Another client was bumping up on the maximum base for her level, and the company was concerned about pay equity with existing employees. But they were able to give her a higher share of the performance bonus pool – that was a separate budget. Other places where employers can add money are the relocation allowance, equity grants, or expense budgets (e.g., for training or travel). When the other party says there is no budget, they may only be thinking of the salary budget or their department’s budget. Encourage them to think more creatively by asking about other pools of money. Even an open-ended question like “Is there anything else we can do?” can prompt the company to think more broadly.
Read two more ideas for how to counter-negotiate in my Forbes Leadership column:
Originally published on March 21, 2017 by SpeakerMatch Speakers Bureau