How to Negotiate Salary When Moving to a Small Company

Negotiate Salary When Moving to a Small Company

There are lots of good reasons for moving from a job at a large company to one at a smaller firm.

Small businesses require their employees and managers, especially, to wear many hats and because fast-growing firms must continually add people to keep up with rising demand for their products and services, they are continuously trained, expanding their skills and responsibilities.

You will likely have more of an opportunity to make a real, meaningful impact on the organization that, if you were at a larger company, would probably take much longer and require you to have a much higher position.  There may also be a lot more autonomy and freedom at a smaller company because the bureaucracy is smaller, and that translates to fewer levels of supervision and management.

Also read: Big Jobs Hiding in Small Places

On the other hand one thing to consider—and it’s a big one—is that small businesses usually pay lower salaries and provide fewer benefits than large corporations. But it’s still possible to work for a small company and be compensated at your market value.  Here are some things to consider when you are negotiating your salary at a small firm, when you’ve come from a larger one:

1. Do Your Research

Before you interview with the smaller firm—or any firm, for that matter—it’s essential that you do your salary homework and know what you’re worth in your industry, with your level of experience, in your geographic area and in the current market. Keep in mind that titles can be broadly descriptive but aren’t necessarily a great barometer of your worth. A “senior marketing manager” with ten years of experience, basic coding knowledge, graphic design skills, who has worked in both for profit and nonprofit arenas, is more valuable than a senior marketing manager with five years experience at one company.

Salary information is available in many places—the Bureau of Labor Statistics, from sites like PayScale and, and from talking to those you know in the industry at other companies. It will be especially relevant to your situation to speak to anyone you can at your level and working at a small firm.  Try to find out as much as you can about the company financially, including things like recent expansion efforts or investments in new equipment, to help you negotiate a higher salary that your initial offer.

2. Forget Your Previous Salary

Lots of people determine the salary for which they will negotiate simply by taking their previous salary and tacking on a small percentage increase or they decide to accept a salary that’s at least at their current level. That’s actually not a great way to go into salary negotiations, because it communicates that little has changed about your skills, competencies and abilities over the course of your employment history. And of course, that’s not true, you’ve gotten better at your job and expanded your skills and knowledge base.  Take your old salary out of the equation and instead look at your value to the company and what you believe the company can pay. If possible, avoid talking about your current or previous salary at all during the interview.

3. Aim High But Be Realistic

Negotiations are just that—a give and take—so expect to ask for your carefully calculated, perfectly legitimate salary request to be rejected in favor of something lower. You’ll be more able to handle this back-and-forth if you have a salary range in mind, rather than one perfect price. Start negotiating by asking for a salary at the high end of your range, knowing that you will likely have to come down once or twice. Your high-end salary figure could be accepted on the first go-round, of course, but keep your expectations realistic.

4. Understand That Compensation is More Than Salary

Unlike big companies, smaller businesses have flexibility to negotiate on salary and other components of your total compensation package.  Things aren’t necessarily write in hierarchical stone, so if you’re flexible in your thinking too, you can probably reach a compensation agreement that’s amenable to everyone. Understand that compensation is far more than what’s in your paycheck.

If the firm can’t really afford to pay what you’d like, look at other benefits, like healthcare coverage, flexible work arrangements, vacation and sick days, retirement fund contributions, tuition assistance, stock options and profit sharing. You can also ask for a salary review in six months—as opposed to the usual 12—with a possible salary increase or bonus at that time based on your performance.

Also read: Navigating the Minefield of Knowing Your Worth at Work – Accepting More Responsibilities


About the Author

Eilene Zimmerman is a journalist who writes about entrepreneurship, technology, small businesses and the workplace. She was a career columnist for the New York Times and is a regular contributor to the paper's small business section.