Negotiating lowball offers
How to respond to a low salary offer when negotiating starting salary
by Josh Doody
What’s your goal in an interview? To get the best job offer possible and to set yourself up to negotiate the best salary possible. You want the company to focus on “What do we have to offer to convince them to join our team?” as opposed to “What’s the minimum we can pay to bring them on board?” It’s a subtle but important distinction.
Occasionally you’ll ace your interviews and still get a lowball job offer, with a salary that’s just too low—way below your minimum acceptable salary. Maybe they simply can’t afford you, or maybe their pay range for this particular job is so wide that they don’t know where to slot you in.
So what can you do to reset the salary negotiation? Here’s a tactic you can use when negotiating a lowball salary offer.
Learn more What's next once you respond to your lowball job offer?
Your minimum acceptable salary makes negotiating pretty easy because it allows you to draw a line in the sand, determine whether a standard negotiation strategy can get you past that line, and counter offer appropriately. Then you know whether to counter offer above your minimum acceptable salary, or just state your minimum acceptable salary as an ultimatum:
“I’m sorry, but I can’t accept this position for less than [your minimum acceptable salary].”
But declaring your minimum acceptable salary should be a last resort—you don’t want to do this unless you absolutely have to.
Fortunately, there’s were a way to significantly improve on a lowball job offer without counter offering at all! Here’s how Joe did it.
I recently worked with a coaching client—let’s call him Joe—who was pursuing a senior position at a very popular, publicly traded tech company—let’s call it ACME Corp.
Joe did really well in his interviews, and we were anticipating a strong job offer from ACME Corp.
“We would like to extend you a job offer…” Great news! But the salary and equity they offered caused us to do a double-take. That’s it? That’s the job offer? We were hoping for much better than that.
The offer was well below the minimum acceptable salary Joe had set before they made the job offer.
They explained that they were cash-strapped and working to grow quickly, so they couldn’t pay a high base salary. They hoped to make up some ground with the equity they were offering, but the equity was underwhelming as well.
Joe had been lowballed. It happens! But we didn’t panic because we had a plan.
But before I tell you what we did, let’s talk about when you should use this tactic.
The first thing to do when you get a job offer is to say something like, “Thanks for the offer! Do you mind if I take a couple of days to think it over and discuss it with my family?” Then you can take your time to consider the situation and plan your next move.
With a lowball job offer, the best move may be to use the very powerful negotiation technique you’ll learn in this article. The trick is to deploy it at the right time like when you get a lowball job offer.
You can sometimes turn a lowball job offer into a more reasonable job offer by giving the company a chance to reset the salary negotiation without making a counter offer. This is key because you really only get one “big” counter offer, and you want to save it until the baseline job offer is as strong as possible.
How do you know when this technique is the right response to a lowball job offer?
If these things are true, then responding with this technique may be the right move:
Are all those things true for you? If they are, then this tactic may be good for your situation.
Rather than counter offering their lowball job offer directly, you will give them the opportunity to improve the offer and reset the salary negotiation so you have more to work with.
It’s best to do that by sending a short email to let them know that the offer is disappointing while asking if they can improve the offer so you can consider it.
The company wants to bring you on board, so they’re thinking “What do we have to offer to convince them to join our team?” They’re probably thinking pretty narrowly—a little more salary, slightly better benefits, maybe a signing bonus.
Your email tells them “You need to think bigger if you want me to come on board.” Your email accomplishes this by doing two things:
Translation: “This lowball job offer hasn’t convinced me to come on board. Want to try again?”
Joe used this technique to respond to his lowball job offer. We didn’t hear anything for a day or so, but then he got a call from the recruiter he had been working with…
“Hi Joe, we agree that our job offer was a little underwhelming. So we went back to the drawing board and here’s what we came up with…”
The new offer was still heavy on equity, but they increased it by 30% by adding a little to the base salary and increasing the equity portion by more than 60%! The best part was that the new offer was strong enough to meet Joe’s minimum acceptable salary and it gave him an opportunity to counter offer and see just how high the company would go.
This technique for negotiating a lowball job offer usually elicits one of two responses, and both are useful.
They may say, “Ok, thanks for considering our job offer. We look forward to hearing your response.” Essentially, they’re letting you know that they’re comfortable with that job offer and it’s pretty close to as good as it’s going to get. In this case, you would just proceed with your standard counter offer.
But sometimes they will try again! “Let us see if we can do better. We’ll get back to you.” That’s what you’re after!
Once they send a revised job offer, then you can proceed with a standard starting salary negotiation.
Beware that companies will often revise their lowball job offer to be pretty close to their best-possible job offer, which means your standard salary negotiation strategy may not yield as big a return when used in conjunction with this technique. The ultimate result is what you want—you’ve determined how much the company is willing to pay you to do the job—and you just got there combining two techniques instead of a single salary negotiation technique.
I'm Josh Doody, a professional salary negotiation coach who helps Senior Software Engineers and Engineering Managers negotiate job offers from big tech companies. On average, Software Engineers and Engineering Managers improve their first-year compensation by $47,273 with my help.
Apply for a free 15-minute intro call to learn how I can help.