The Secret of Fair Market Value and Social Capital in Entrepreneurship

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I’ve decided to embrace my inner bitch.

Here’s why:

A few weeks ago I was sitting down for a negotiation and the company asked me to throw out a ballpark figure of how much it was going to cost them for me to perform a service. In business school at Syracuse University I learned that the price for something is whatever the market will bear so instead of making the first offer, I let them. They waffled. I told them to think about it and let me know and we could negotiate from there. After a few moments they tossed out an obscenely low figure. I asked about terms and they said it was firm and had to be their way.

Now I learned a long time ago that everything is up for debate—even the things people claim are non-negotiable. Those spots are often the areas that have the most wiggle room.

I countered, offered the value I brought to the company and sat silent for a long period of time.

I was amazed at how quickly the company started touting the value of what I brought. They started selling me on why I ought to work with them. Their figure came up but just barely. It translated to pennies on the hour and I know from research that women are often paid .75 cents to the $1 of what a man would be offered for the same gig.

Needless to say the figure wasn’t at what the market would bear.

I know first hand people who pay are always looking for a cheaper price whereas the person performing the service wants the highest price. Because of this, there’s always tension. I didn’t get upset.

I just declined the offer.

Later, I told a man about my experience. He said I was being “bitchy” and I should just have taken the offer because half a paycheck is better than no paycheck at all.

I didn’t want to devalue what I do, so I didn’t take the pay cut.

A few weeks later I listened to the same man negotiate a pay raise. He said unless he received the number he had in his head he would neither move nor perform the duties asked of him. His boss said this was a smart move. I told him it was bitchy. He told me it was just smart business.

I know because of the lessons I learned in business school that price is determined by whatever the marker will bear. I learned from experience that the trade off for fair market value is a loss in social capital.

About the Author

Named Top 100 Leaders by 2012 Magazine, Jasmine Grimm has been nominated for Central Penn Business Journal’s “Top 40 Under 40,” and The Lancaster Chamber’s ATHENA Award.

Jasmine founded Ruby, Inc. a personal styling business that teaches women how to dress for their body types and became a two-time nominee for Inc. Magazine’s Top 30 Under 30 Top Young Entrepreneurs in America. She won the 2013 SCORE Business Development Award, won the Central Penn Business Journal’s Top 25 Women of Influence Award in 2013 and the 2013 Leadership Award from the MS Society.

She has been a popular guest lecturer at the Maastricht Institute of Entrepreneurship and has been featured in Under 30 CEO and Productive Magazine, was the cover story for Harrisburg Magazine and her writing has graced National Geographic Television and Film, Harvard University and more.

She’s a 5,3,8,3 on the Kolbe A Index and her strengths include input, relator, learner, responsibility and achievement.

For more information visit her Google + Page.

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