When to do it? Most of the time, this only comes up at the end of an interview or in the second or third interview. The reason being that it only becomes a discussion point when both parties are pretty sure they will be working together. So don't bring it up prematurely until you get a good feel that you have the employer very interested in you, or they bring it up first!
Being prepared and having information is vital in negotiating your salary and other terms of your employment. You should note that employment negotiations are not like bartering or buying a car. You may end up working with your negotiator on a daily basis if things go well, so even though you'll want the best deal possible, you should proceed in a diplomatic manner.
Figuring out where you stand relative to other candidates for that position is vital to your negotiation strategy. If you're at the final interview and feel you're top in the running for the position, you should be able to negotiate according to your terms. If, however, you know you're only one in a pool of potentials, salary terms could be the deciding factor in hiring you, so think carefully before you aim too high.
Lie during your negotiations and you have a potential of getting caught and losing all your credibility. Even if you get hired, you will jeopardize your future career as the employer knows that you had lied. Always be prepared; determine which areas may be problematic before you get to the negotiating table. Practice on your negotiation arguments.
During negotiations, consider the value of the whole package and not just your salary. Be creative about making tradeoffs to increase the value of the entire compensation and benefits package, for example, flexi-working hours, stock options, annual leave, medical coverage, etc. You may be able to trade something rigidly regulated (ie, pay level) in the company for something with which the company is more flexible (ie, working hours).
Don't approach negotiations with the objective of winning a game. Take control of your competitive streak in case your drive to win clouds your ultimate goal, which is to get the job for the right compensation. Even if you win the negotiations, make sure you leave the interviewer with a sense of "win-win" - getting your talent and skills for a fair rate.
Salary negotiations are essentially the prelude to your career in that company. How you manage your initial contact via the negotiations will be the start point of how you will be perceived in that company. If you negotiated effectively, you can start your new job confidently knowing you've achieved the best deal for both you and the company. Further, there will be increased opportunities for negotiations of your package in the future if you excel at your job.
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