I appropriately write this on “Small Business Saturday” and artists and galleries are among the smallest businesses around. But, as I say in the essay, few seem to know how this small business works on either the production or marketing sides. In my art education no one ever told me and I’m willing to bet that business or dental college didn’t either. So, I call it:
“Ignore the Man Behind the Curtain”
Many years ago, at a Texas Accountants and Lawyers for the Arts (TALA) workshop, a lawyer in the audience was amazed at the most common business practices of the visual art world. The lack of contractual obligations was merely the first of many revelations to most of the legal and accounting professionals attending the event. Since it was common knowledge within the art world, it seemed odd at the time that these professionals were so surprised by the commercial practices. But, since there is no transparency in the business of art, probably many of the practitioners (especially the younger ones) and most of the consumers of art don’t have such information either.
First we have to agree on the fact that Art is a business activity. It has many concerns beyond the business, but never forget that it is a commercial activity, at all levels. The recent due(l)(t) of Art Fairs here in Houston should have convinced even the most altruistic of us of that fact. Money is made and lost; who gains or loses depends on “whose ox is gored”. If we agree on this initial fact then we can explore how it works.
But first a question (directed mainly to the consuming public), how many artists who live and work in Houston earn their living solely from the making and sale of their art? It may surprise many that you won’t need your toes to count them, probably not all your fingers either.
Making the art is a given, artists make art because they have to, it’s more addictive than any of the drugs that they may use to relieve the pressures of the profession. And it’s not an inexpensive addiction either; I estimate that most artists spend at least 40% of their GROSS income (from whatever source) to make what you see.
Once the thing is made it becomes a marketing problem; the initial assumption is that it’s simply a matter of going to a gallery and having an exhibit. Fame and fortune follow, along with the rock and roll lifestyle, and the social dissipation of the traditional Bohemian existence.
There are far more artists, making wonderful work, than all the galleries, alternative spaces, museums, or art consultants in town can possibly exhibit or offer for sale. The next obvious question is: How are the artists who are exhibited chosen? Remember, art is a business – if the dealer doesn’t have a base of collectors who implicitly believe the gallerist, no matter what the product, they have to choose work that they hope they can sell. The “art-ness” of the work is strictly a secondary concern to keeping the doors open, the lights on, and the dealer’s lifestyle maintained. This is not to say that the dealer doesn’t have an individual, personal, nurturing and continuing relationship with the art and artists they represent; but the initiation of the relationship is based on a strictly business judgment rather than only an aesthetic decision.
This business decision is based on many concerns: Does the artist have a history of sales and a collector base? Does the artist have “art institution” support? Is there a positive “critical” history? Are the prices the artist commands high enough to guarantee limited sales will support the gallery? Does the artist have a high enough profile in another context to generate sales? Does the work “fit” into the gallery’s profile? Do the prices fit the demographic of the gallery? It is the “Catch 22” situation that nothing succeeds like success.
Assume that the artist is fortunate enough to garner representation, how is the business conducted? First off, there is a tremendous difference between a “dealer” and a “gallerist”. A dealer “makes the market” and expands the opportunities for the artists they represent, a gallerist sells things to whomever walks into their space. Most of the galleries in Houston actually fit both descriptions, depending on that month’s exhibit and irrespective of the prominence of the artist.
The artist was paid for the art before the exhibit, right? Just like the shoe store on the corner, they had to buy their inventory. Well that was the way it used to be 150 years ago; in my 36 years in Houston only ONE gallery EVER owned all their inventory and Gerhard Wurzer died years ago.
Assuming that you are a potential collector and you walk into the exhibit, how does the business proceed? There is a price listed somewhere, either on a wall label or a price list. That is the MSRP of the gallery. Depending on your status as collector, or if you are a frequent buyer, you may be offered a discount, since a prominent collection is a spring board to sales to other collectors. Owing to the present economic situation, galleries are more amenable to discount a price and, in the best of all possible worlds, the gallery absorbs the discount, usually both the gallery and artist share the discount, often it is only the artist.
What does that mean to the artist? Your motivation may be to support an artist that you are familiar with, or friends with, or consider a viable investment; how much of that purchase price can you assume goes to the artist? In truth it varies, an artist who has a “international” or even “national” reputation and sales will get a larger percentage, but the artist who needs it the most will be lucky to get 50%. For their 50% they will have to support the cost of production, perhaps framing (sometime the gallery will provide this, but not often), and the “overhead” of operating a studio. Profit can get pretty minimal; the larger the discount, the smaller the artist’s potential profit. Strangely, sculptors sometimes get their cost of production “off the top”, since the foundry casting process is so expensive.
The artist has made a sale, HOORAY! but, the gallery has the money and very few cut the artist a check upon the sale of their work. Many galleries, depending on the gallery and the “informal arrangement” they have with the artist, keep the money derived from the sale for an indeterminate period of time. Remember, there are very few galleries and artists that have an actual, written and signed, contractual responsibility to each other. I have anecdotal evidence of galleries owing artists five figures for months, but sometimes this is because the artist is trying to help keep the gallery stay open. But, generally, it is to maximize the gallery’s profit margin. Again, remember this is a BUSINESS.
What do you as a consumer and collector do to minimize your expenses? Or as an artist who needs the mortgage payment this month? One of the first actions is to cut out the middleman and go directly to the artist. This has some unforeseen ramifications: if the artist sells directly to a collector, they are usually responsible to share the purchase price with the gallery, depending on the agreement (perhaps contract) with the gallery. If the artist sells “out of the studio”, especially with a major discount, and does not give the gallery their share, invariably the gallery will learn about it. I’m sorry, but those of you who are collectors are notoriously prone to brag about the “cheap” work you got from (substitute your favorite artist here) and “loose lips, sink artists”. Desperation often leads artists to abrogate their responsibility, only to lose the representation they need. There have been artists in Houston who have done this and survived, but not many. If you can’t trust each other it’s tough to keep an active relationship (it’s like cheating on your spouse that way, you may still love ’em, but you just can’t live with them).
Similarly, an artist may have a geographic restriction on how many galleries, in what area, they can exhibit in without an agreement between the galleries. Ambitious young artists sometimes make that mistake, and, again, collectors will let the secret slip to the “primary” gallery. However, sometimes geographic separation will generate sales; anecdotally, I know of collectors who will not deal with a particular local gallery and prefer to buy the same work at a gallery in another city.
Remember this is a BUSINESS!
How does an artist gain the representation they seem to need, or at least exposure to the public, without conforming to a gallery’s “format” or other, more destructive, compromises? And, how does a collector, with altruistic intent, find art that speaks to them and artists they would want to support?
Well, first off, REMEMBER this is a BUSINESS, a “quid pro quo”. Both producer and consumer have to work at it. I’m pretty sure that the internet isn’t the answer, but it might help both sides. Personal contact and “networking” is more pleasant, especially over a drink.
Talk amongst yourselves. Artists, talk to people about collectors and share information, you could even tell a collector about someone else that they might prefer to yourself. Bert Long once compared the Houston art scene to a “basket of crabs, as soon as one gets to the lip of the basket, the others drag him back down.” Art as a business isn’t a zero sum game. Make that which is most important to you, not “what sells”. Someone will like it, don’t overprice your work, but don’t starve yourself either.
Collectors, ask artists leading questions; artists LOVE to talk about their work, if it seems interesting, go visit where ever the work is, gallery or studio. The studio may not be an upper-class showplace like the pristine white walls of the gallery, but generally you won’t get cooties. If you like something, buy it, if you don’t like it, that’s OK. Probably, someone you know would like it, tell them about it. Talk amongst yourselves and compare your experiences with artists and galleries, and realize artists’ prices amortize their materials, time, and experience, they’re not just gouging you.
And to quote the Bard, “To thine own self be true.”
& Let’s be careful out there.
also by Meredith Jack
- Eventful in FotoFest - March 11th, 2014
- Passion, or How You're Responsible for What You See - March 10th, 2013
- Copyright, The Dark Side - December 13th, 2012
- Visual Artists and Copyright Rights - November 27th, 2012
- Politics, Religion and Abstract Art - November 18th, 2012