You've found the perfect candidate. They're interested. You're about to make an offer.

Then salary negotiation happens, and one of three things goes wrong:

1. You lowball them and they walk away insulted
2. You overpay out of fear of losing them
3. You play negotiation games and damage trust before they even start

Here's how to handle salary negotiations professionally without losing great candidates or wrecking your budget.

The Biggest Mistake: Not Discussing Salary Early

The number one salary negotiation mistake happens before negotiation even starts: avoiding salary conversations until offer stage.

What happens:

• You spend weeks interviewing a candidate
• They spend hours in your process
• You make an offer
• They say "that's way below what I'm looking for"
• Everyone's time is wasted

Fix this: Discuss salary expectations in the first conversation. Not as a "gotcha" screening question, but as an alignment check.

How To Bring It Up Early

In the first call, say this: "Before we go too far, I want to make sure we're aligned on compensation. The range for this role is [actual range]. Does that work with what you're looking for?"

Not this: "What's your current salary?" (illegal in many states and irrelevant anyway)

Not this: "What are your salary expectations?" (without telling them your range first)

Give them your range first. Then let them tell you if that works. If there's a gap, you know immediately instead of after three rounds of interviews.

Stop Playing The Lowball Game

Some recruiters think the winning strategy is:

1. Figure out the lowest number candidate will accept
2. Offer that number
3. Save the company money

Here's what actually happens:

The candidate accepts your lowball offer. Then:

• They feel undervalued from day one
• They keep looking and leave within a year
• They tell their network you lowball offers
• You're recruiting for the same role again in 12 months

Winning strategy: Make your best offer upfront. Price the role fairly based on market, experience, and internal equity. Make an offer you'd be proud of, not the minimum you think they'll accept.

The Offer Conversation Structure

When you're ready to make an offer, don't just send an email. Have a conversation first.

Step 1: Frame the offer

"I'm excited to extend an offer. Before I send the formal details, I want to walk through it with you to make sure it makes sense."

This sets up a conversation, not a take-it-or-leave-it moment.

Step 2: Present the full package

Don't just lead with salary. Break down the full compensation:

• Base salary: [amount]
• Bonus/commission structure: [details]
• Equity: [if applicable, with actual valuation context]
• Benefits: [highlight what's actually valuable]
• Other perks: [only mention things that matter]

Pro tip: Know what candidates actually value. For a mid-career professional, 401k match might matter more than a ping-pong table.

Step 3: Give them space to respond

"What do you think? Does this align with what you were hoping for?"

Then stop talking and listen. Don't fill the silence. Let them process and respond.

How To Handle Negotiation Requests

Candidates will negotiate. That's normal and expected. How you respond matters.

They ask for more money

Don't say: "That's our final offer" (unless it actually is, and even then, there are better ways to say it)

Don't say: "What number would make you say yes?" (you're just negotiating against yourself)

Do say: "I appreciate you being direct. Let me see what I can do. That range is above what we initially scoped, but I'll talk to the team and get back to you by [specific time]."

Then actually go figure out if there's flexibility. Come back with a specific response, not vague maybes.

They ask for way more than your budget

Sometimes candidates ask for compensation that's genuinely outside your range—not just a stretch, but a real mismatch.

Do say: "I appreciate you sharing that. To be transparent, that's significantly above where we've budgeted this role, and we don't have flexibility to get to that range. Our best offer would be [your top of range]. I understand if that doesn't work for you, but I want to be upfront rather than string you along."

What happens: Either they adjust expectations because they really want the role, or they pass. Both outcomes are better than wasting more time.

When You Have Flexibility vs. When You Don't

If you have flexibility (you can move up 5-10%):

• Be honest that there's some room to move
• Ask what it would take to make it work
• Come back with your best offer
• Make it clear it's your best offer so you don't keep negotiating back and forth

If you don't have flexibility:

• Be clear upfront: "This is our best offer given the role level and internal equity"
• Don't pretend to "check with leadership" if you know the answer is no
• Help them understand why (internal equity, budget constraints, role level)
• Let them make a decision with full information

The Internal Equity Problem

Sometimes you can't match what a candidate wants because it would break your internal compensation structure.

Be honest about this: "I'll be transparent—the number you're looking for would put you above people in similar or more senior roles here. We can't do that without creating equity issues across the team."

Candidates might not like it, but they'll respect the honesty. And if they push back on that, it tells you something about how they think about fairness and team dynamics.

What To Do When They Have Another Offer

"I need to let you know I have another offer. I'm more interested in your role, but they're offering [amount more]."

Don't: Immediately match or beat the other offer out of panic

Do: Ask questions to understand what they actually want

"I appreciate you letting me know. Help me understand—is the other offer attractive because of the compensation, or are there other factors? What would make our role the clear choice for you?"

Sometimes it's not about money. Sometimes they just want to feel valued. Sometimes the other offer isn't actually as good when you break down total comp and role fit.

Then: Make your best decision. If you can increase the offer and it makes sense, do it. If you can't, be honest. Don't make promises you can't keep just to win the negotiation.

The Red Flags In Negotiation

Some negotiation behaviors are warning signs:

Moving the goalposts: You meet their number and they ask for more. Then you meet that and they ask for more again.

Only caring about money: They never ask about the role, the team, the growth opportunities—just comp.

Using other offers as leverage constantly: "Company X offered me [amount]" for every element of the package.

These might be signs of a candidate who'll be difficult to manage or who's just shopping offers without real interest in your company. Proceed carefully.

How To Close The Deal

Once you've negotiated and landed on final terms:

1. Confirm verbally: "So we're at [total package details]. Is this what you need to accept and give notice?"

2. Set clear timeline: "I'll have the formal offer letter to you by [specific day]. How much time do you need to review before signing?"

3. Stay engaged: Don't go silent after they verbally accept. Check in, answer questions, keep excitement high until they sign and start.

4. Send the offer promptly: Don't make them wait days for paperwork. Get the formal offer to them fast while momentum is high.

When To Walk Away

Sometimes negotiations reveal the candidate isn't the right fit:

• They're asking for comp that doesn't match the role level or market
• They're playing games or being dishonest about other offers
• The negotiation feels adversarial instead of collaborative
• Your gut says this is how working with them will feel

It's okay to pull an offer if negotiation reveals red flags. Better to do it now than after they start.

The Bottom Line

Good salary negotiation isn't about "winning" or paying the least amount possible. It's about:

• Discussing compensation early so there are no surprises
• Making fair offers you're proud of
• Being honest about what you can and can't do
• Treating negotiation as problem-solving, not combat
• Closing deals with candidates who feel valued and excited

You'll lose some candidates to higher offers. That's fine. You'll keep the candidates who are the right fit and who value transparency over games.

And you'll spend way less time re-recruiting for roles because candidates leave after six months feeling underpaid.

The Fast Version:

• Discuss salary range in first conversation
• Make your best offer upfront, don't lowball
• Have an offer conversation, don't just send an email
• Be honest about flexibility (or lack of it)
• Ask questions when candidates have other offers
• Don't play negotiation games that damage trust
• Walk away if negotiation reveals red flags
• Close fast once terms are agreed