For most of my life, I SUCKED at negotiating.
I was too scared to even try and I had every excuse in the book, especially for negotiating my salary:
“I’m afraid they’ll say no.”
“They will give me a raise if I work hard.”
“I can’t negotiate.”
Negotiating even a $5,000 salary bump would have been life changing for me. I was really struggling to pay the bills and I was helping put my brother through college. An extra $400 a month would have made a huge difference!
Not only that, but I also knew that a person in my position could make up to $10,000 more than I was making at the time. Even then, I wasn’t negotiating my salary. I was leaving thousands of dollars on the table.
I started wondering how many times I left money on the table by letting fear stop me from negotiating. TImes like buying my first house, buying my first car, and raises for 3 promotions.
And, there are countless more situations in which a negotiation would have gotten me a better deal.
That’s when I finally realized that to live the life I want to live, free of worry about money, I had to become a better negotiator.
Since that time, I’ve devoted countless hours to becoming a great negotiator. And guess what? I LOVE negotiations now. It is weird to hear myself say that, but I do. I love that by taking a small risk, there can be such a HUGE reward.
In this article, I am going to show you exactly how to shift your mindset and battle the biggest mental roadblocks in negotiation as well as the 5 most important rules to becoming a great negotiator.
How do I know it works? Because after years and years of convincing myself otherwise, this is exactly what I did to get over $50k in raises over a period of 4 years.
Shifting the Mindset
Excuse #1: “I’m afraid they’ll say no.”
It is so easy to fall into this trap. Why are we so afraid of someone saying no? If I told you to call your credit card company right now and negotiate your annual fee, I’m sure it would make you uncomfortable to do so. But if you really look at it, what is the worst thing that can happen? They say no. That’s it! And you’re not even face to face with the person.
This fear is not only a hindrance to your negotiation skills but everything we do in life. Starting a business, applying for a new job, and countless other potential improvements to our lives that we don’t try just because we’re afraid it won’t work out.
The best thing is to start with small situations that make you a little uncomfortable but get you some small wins. Start by buying a couple of things on craigslist and force yourself to negotiate the price. Do you really care if you get that used coffee table for five dollars less? Probably not, but it’s the first step towards building your confidence, and then you can move on to bigger things.
Excuse #2: “I’m just grateful I have a job.”
I knew so many people that were looking for jobs, either because they were unhappy with their current one, or they were unemployed. Meanwhile, I felt like I was sitting pretty with a job I actually enjoyed. I felt grateful just to have a job.
At the time, during the 2008 recession, there were constant reminders that we all should just feel lucky to have a job.
The truth is, I agree that you should feel fortunate to have a job you enjoy… but, it is important to understand that the company is also lucky to have you. You do great work, and that work should be appreciated and fairly compensated for.
Excuse #3: “They will give me a raise if I work hard.”
If you just work hard, they’ll pay you what you deserve, right?
When I was promoted to a management position, I realized just how wrong this mindset was. Your manager has a million things going on, and giving you a raise is not near the top of that list, unless you make it so.
It is up to you to show your value and make sure you’re paid for the massive value you bring to the company. If you keep waiting for the raise you deserve to just fall in your lap, I guarantee it won’t happen.
When was the last time you got a significant raise without asking? I thought so.
Excuse #4: “I can’t negotiate.”
I’ve never negotiated before. My boss wouldn’t go for it. Sure, I’ve heard of others negotiating but their boss appreciates them… they had a few more years of experience… my industry is different…
And while you’re stuck thinking about all these excuses, others are negotiating and getting paid what they deserve.
The truth is, You CAN negotiate, you just don’t know it yet. Up ahead, you’ll see The 5 Essential Rules, and once you put those into practice the doubt about negotiating will disappear.
Excuse #5: “We didn’t hit our goals as a company, so it wasn’t the best year. I shouldn’t bring it up.”
There will always be something going on in the economy or the finances within the company. The company may not have hit their financial goals… the economy may be in a recession… those are all things that you can’t control.
What you can control is your value and how much that is worth. During any type of downturn, the most important thing for a company is to keep the best of the best. That is where you come in. In order to keep you, they have to pay you fairly.
The 5 Essential Rules
Has your mindset shifted yet? Are you fired up about getting what you want? Good, you’re on the right track. Now all you need is a few simple tactics to sharpen your skills:
Rule #1: Everything (well, most everything) is Negotiable
The belief that you need to truly understand is that everything is negotiable.
Now, you may be thinking ‘that’s not always true,’ and you might be right, to an extent. The important part is that for any situation, you need to learn how to ask ‘what can I negotiate?’
Once you start thinking about it that way, it will open up a world of possibilities.
Leasing a new apartment? You can negotiate monthly rent or amenities.
Getting a new credit card? You can negotiate the fees associated with it.
Getting car insurance? You can negotiate the rate.
Once you really imprint this into your mind, you will start to see everyday situations in a whole new light.
Noah Kagan, the founder of 2 multi-million dollar businesses, came up with a great exercise that you can apply to this first rule. Next time you’re paying for your daily cup of coffee, ask for a discount. Does that scare you? Good. But you can do it. And you’ll survive.
This isn’t designed to help you save money on coffee, it is actually the opposite. This challenge is all about failure; it is designed to put yourself in an uncomfortable situation and learn more about yourself and the fears you have about rejection. Try it out, many people have even gotten the discount!
Rule #2: Research, research, research.
Preparation is the single most important aspect of a negotiation. If you haven’t done the research you’ll be going in blind without knowing exactly what you’re negotiating for, and this is the case for any type of negotiation you are going into.
When you first start thinking about what you can negotiate in any given situation, it is understandable that doubt starts to creep in. This is why you start small. First, convince yourself to just do the preparation aspect of it, even if you don’t plan on following through.
I started with a negotiation on some outdoor furniture that I wanted to buy on Craigslist and instead of going into a negotiation cold, I started my research.
I looked up the prices for the chair swing, new and used, and figured out the market rate for the item. I made sure to get details on the condition of the chair, by looking at pictures and asking the seller. Then, I felt comfortable with the price I wanted to negotiate to and had some facts to back it up.
After this prep work, it became hard not to go ahead with the negotiation because I felt confident about what I was asking for and why I was asking for it.
Not only that, but I succeeded! If you start small, you can see what the result could be with just a little preparation. This is where your confidence will grow and you start seeing that this formula will work, whether it be negotiating for a raise or a new car.
Rule #3: Patience IS a virtue.
Yeah, yeah, I know it’s a corny statement. But this one is really important. You’re going to find yourself getting into negotiations and before they even start, you’re going to be wishing that they were over and you were at home, three episodes deep in Narcos. But every good negotiator knows that patience is extremely important in a negotiation, and you will gain the most by not rushing it.
The first time I bought a car is a prime example. I went to the dealership and as soon as I saw the car I wanted, I just wanted the process to be over as quickly as possible. All I wanted was to walk out with a car that day. Because of that, I didn’t negotiate one cent.
What if I negotiated the price down by a few thousand bucks, but maybe it took one more day? It would have been totally worth it.
Don’t let anxiety or your emotions about the matter at hand cloud your mind during the negotiation. Take a step back and realize that there are a lot of cars and dealerships to choose from, and the person on the other side of the table knows that as well.
Don’t be afraid to walk out of the dealership when the salesman doesn’t budge. Most of the time they will call or stop you before you leave to give you a better offer. It may take another day to get it done, but it will be worth it in the end.
Rule #4: Understand who is on the other side of the table.
We’ve talked a lot about our side of the negotiating table, but what about the person facing you? You must understand who it is you’re talking to in order to figure out how to best approach the conversation.
For example, if you are negotiating salary for a new job, are you talking to HR or your future boss?
With your future boss, you need to make sure that your selling point is the value that you bring to solving his problems. That way he will fight to pay you what you deserve because he knows that you’re going to kick ass for him in the future.
For HR, it may center more on the market and the data supporting the raise. This conversation will be more data driven and less emotional.
As you begin to understand the other person, you have to understand what is important to them. What are their needs, hopes, aims, and concerns? By understanding their interests, you can figure out how to make sure the negotiation satisfies at least some of their interests as well as your own.
Some people think that in a negotiation someone has to get screwed. That couldn’t be further from the truth.
When you negotiate your bills, the company you’re talking to is happy to offer you a small discount in order to keep you as a customer. An employer wants to keep a high performing employee like you, so a bump in pay will be a drop in the bucket.
Rule #5: Practice, practice, practice
The only way to become a better negotiator is to practice. Whenever you are preparing to do a negotiation, try it with with a friend first. Call someone up or do it at home. It doesn’t matter as long as you’re spitting the words out and getting a feel for how the conversation will go. Imagine how confident you’d sound going into a negotiation if you could recite your plan in your sleep.
Also, start looking for ways to practice negotiations in general. Buy a $10 item on craigslist, do it at the local farmer’s market, anything! The more you get yourself to flex this muscle, the easier and easier it will become and the more your confidence will grow.
What you can do right now
Once you start shifting your mindset and following these simple rules, you will develop a love for negotiations. It will become something you will be good at, and you’ll want to do it more and more.
In order to get you started on your journey to becoming an awesome negotiator, try this:
- Pick something to negotiate – this could be a Craigslist purchase, Farmer’s market, credit card rate, your next Airbnb stay.
- Do your research – figure out how much cheaper you can buy that chair or eggplant somewhere else, and figure out your plan.
- Complete a simple negotiation before the week is over.
This small action can be a big step toward getting the salary you deserve, and thousands upon thousands in future income. Don’t put off getting paid what you deserve and living the life you want to live!