Desperate Times

 

I have never seen a reputable gallery ever hold a gallery sale, so I was curious when I started to see this happen.  I asked myself a number of questions. “Gallery Sale” - Maybe the wording is just a come on…i.e., the works in the gallery are always on sale. But then, are they creating an expectation of lower prices that will not be fulfilled? Are artists discounting their own work or is the gallery prepared to reduce the prices on the stock of work they own outright?  Does creating open discounts diminish the value of works already sold and undermine collector confidence? Does this mean slashed prices? That sounds like someone is going out of business! Unusual times call for unusual policies, so this is a confusing subject.

To understand this, you need to know that galleries have an understanding with the artist when sales prices are set. There is usually a percentage of discount that can be given without contacting the artist for permission to sell the works for less than the asking price. The gallery could also reduce its commission, but the artist, in the most optimal arrangement has final say on the sales price paid.

And many galleries have their own private collection of works of art. Some stock is acquired of artist that they think is a good investment. They might hold on to the work and wait for it to escalate. Or they might buy work by their own stable of artists that comes up for sale on the secondary market. They may even have been buying work in auction in order to protect the value of works by artists they are selling. They have complete control of the final price for any of these works that they own outright.

The gallery may also be holding work on consignment for clients who are placing them at the gallery to try to resell work that they previously bought. It could be those clients need the money quickly and are willing to reduce their prices, or the gallery is prepared to reduce its commission charge for this second purchase.

So, in most cases at high end galleries, the word “sale” can simply be a case of negotiating on the final sales price. Maybe before a sale, the greater discount is discussed with the artists. Maybe the gallery is prepared to take a lower price than they previously had decided for certain of their works in private stock. Or maybe a client has reduced his asking price for a work on consignment to the gallery.

In none of these instances, should you see dramatic drop in prices as that could indeed trigger a crisis in confidence in the artist’s value.

Are there other ways to drive collectors into galleries at this desperate time, without announcing a sale? Of course, and I can think of just a few:

·        Buy a work and get a discount on a work in another less expensive media, a print perhaps.

·        Ask artists to consign less expensive works to the gallery for example a special one off run of monotypes.

·        Get groups of collectors to buy large works together and rotate them from home to home from year to year

·        Rent out works for a rent to own price.

·        Hold dinner parties in the gallery so collectors can meet the artists and we can all finally get out of the house!