Should you make the first offer in a negotiation?
AB
by Andy Bell · Partner, Lane Neave · 12 July 2026 · 2 min watch
The short answer
Usually, yes. The first credible number anchors the whole negotiation — every counteroffer gets measured against it. Waiting politely hands that advantage to the other side. The condition: you need to know the market range before you speak. Go first when you have done the homework; stay quiet only when you are guessing.
Why does the first offer matter so much?
Most people treat the opening number like a trap: say it too early and you have shown your hand. The psychology says the opposite. The first credible figure in a negotiation becomes the reference point for everything that follows, and both sides start reasoning from it whether they mean to or not. That is the anchoring effect, and it is one of the most consistently replicated findings in negotiation research.
Anchoring is not persuasion. The other side does not need to believe your number is fair for it to work. Once a figure is on the table, every counteroffer is framed as a distance from it. A negotiation that opens at $100,000 and one that opens at $70,000 tend to settle in different places, even on identical facts.
When should you make the first offer?
When you know the range. Going first is an advantage you earn with preparation: what similar deals settle for, what the market pays, what the realistic best and worst outcomes look like. With that picture, opening first lets you plant the anchor at the ambitious end of defensible.
If you genuinely do not know the range — a market you have never dealt in, a role with no comparable salaries — the anchor can work against you. That is the one situation where letting the other side reveal information first makes sense.
How ambitious should the number be?
Ambitious but defensible is the test. An opening figure you cannot justify collapses the moment someone asks how you got there, and a collapsed anchor is worse than none. Pick a number at the favourable end of what the evidence supports, be ready to explain the reasoning once, and then stop talking. Do not negotiate against yourself while the other side sits in silence.
What if the other side anchors first?
Do not counter from their number — that accepts their frame. Name the figure for what it is, put your own researched number on the table with the reasoning behind it, and re-centre the conversation on yours. An anchor only holds if you negotiate against it.
Key points
- The first credible number sets the reference point for the whole negotiation — the anchoring effect.
- Going first wins when you are prepared; it backfires only when you are guessing at the range.
- Open ambitious but defensible, justify the number once, then stay quiet.
- If they anchor first, do not counter from their figure — re-anchor with your own.
Frequently asked questions
Does going first work in salary negotiations?
Yes, with the same condition: research the band before you name a figure. If you know what the role pays in the market, opening with a defensible number at the top of the band anchors the conversation. If you have no idea what the role pays, ask questions first.
What if the other side opens with a lowball figure?
Don't counter from it — that accepts their frame. Label it for what it is, put your own researched number on the table with your reasoning, and negotiate from yours.
How much higher should my opening offer be than my target?
High enough to leave room to move, but never past what you can justify out loud. If you can't explain the number with a straight face, it's too high to hold.
Does this apply to employment settlement negotiations in New Zealand?
Yes. Settlement discussions are negotiations like any other, and the first credible figure shapes the range. Get advice on what comparable cases resolve for before anyone names a number.
Read the full transcript
Andy Bell:
You've been told never to make the first offer. That advice is quietly costing you money.
Here's what actually happens in a negotiation. The first real number on the table is the anchor. Everything after it — every counter, every "let me think about it" — gets measured against that number. Name it, and you've set the ceiling. Sit quiet, and you've just let the other side set it for you.
We've all been taught the opposite. Don't tip your hand. Let them go first. Play it cool. So two people sit across a table, each waiting for the other to blink, and whoever speaks first supposedly loses. It's the reverse.
Psychologists call it the anchoring effect, and it's one of the most tested findings there is. The first credible figure drags the whole negotiation toward it. Every number that follows is just a reaction to yours.
Now, the obvious objection: won't I lowball myself? Only if you walk in blind. That's the real rule. Don't avoid the first offer — earn the right to make it. Do your homework. Know the range. Then open with a number that's ambitious and that you can defend.
Because that first number isn't a guess you're scared to get wrong. It's the peg. The whole rope gets tied to it.
So next time, stop waiting to react to their number. Make yours land first. Name it, aim high, back it up — and then say nothing.
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