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Print Sales and Pricing Techniques
To continue with the Peter Lik story, he has several galleries operating: twelve in total as of this writing in 2016. What he did and still does, is hire a sales team that he trains to sell his work. Since everything he does is photography in limited editions, he used a system that galleries have been using for years. If an artist creates a photograph or any work on paper for that matter, they are usually in limited editions of seven or twenty-five or a number that is determined by the artist depending on the process for printing. In most higher-end galleries there is tiered or “elevator” pricing, which means that if a photograph is made in an edition of seven, the price increases as the photo sells.
For example, if the photograph starts at five hundred forthe first print in the edition, the second one might be six hundred and the third seven hundred until the last print is more than double the price of the first. All the prints are virtually identical, but the reason that the pricing goes up is carefully calculated. In one sense, the buyer who is first, is taking the biggest risk—he or she does not know if this will be a popular print or an investment, so they get the bonus of a lower price for taking a risk and being the first. The second buyer still gets it for less than the rest of the buyers, but the last buyer of the edition pays the most because they are taking the least risk of all and are jumping on a bandwagon that is already rolling, so to speak.
The reason this sale is effective and used by many photography galleries is because once someone is interested in an image, it is easier to sell them that image by saying it will be worth more the next time they come in. Peter Lik trained a team of sellers in all his galleries toemploy this method aggressively. When someone was interested in a print, the salesperson would explain how wonderful it is, what good taste they have, and if they didn’t buy it right now, it would cost more the next time they came in. That is his whole sales technique which you can read about if you search the New York Times online for his name. Again, the New York Times pokes fun at him because he is a millionaire artist that is not known in the museum world or the at world, at all. However, whatever you think of his images or his sales techniques, this is one method that truly works.
My Own Gallery
When I opened up my own gallery, I didn’t know any of this. I wasn’t really sure how to sell anything, I just knew what I wanted the gallery to look like and I hung shows that looked good and had a price list available. My experience in terms of making sales was mixed. While I didn’t actively “sell” people, what I did do was hang plenty of work in the gallery and in most cases, about two-thirds of the work would sell, but not always. Since it was in a community that had a lot of traffic in the summer, I had openings every two weeks which was a lot of work, but also kept the sales coming in. The irony was that even though I was selling a lot of work at my gallery in the first year, I wasn’t paying all the bills or making much of a profit!
The reason I wasn’t making a profit was because my overhead costs were high. The rent on the gallery for the summer, which included spring and fall, was seven thousand dollars. The spring and fall were not as active as the summer. So I had about ten shows each season and the artwork was priced between $300 and $1500, which seemed like a reasonable range to me. What I didn’t factor in was how much I actually needed to make in order to thrive. I was not alone in my naïve thinking, because many new entrepreneurs and store owners make this mistake. Instead of actually figuring out how you are going to make a profit, you just get excited and fill up your space and start selling and base your sales sense on what you see in other stores or galleries.
Here is the financial breakdown of why the gallery wasn’t profiting. The rent was $7,000, then the costs of openings (ten of them) was about $150 an opening for wine and snacks, then there was electricity and sales tax, and I didn’t include a salary for myself or my girlfriend who were the owners—I just figured we would split the profit.
So the total overhead was about $10,000 for the season, and I sold about $2,000 worth of art at every show (which seemed good to me, that’s $1,000 a week). Most of the work sold, as I said—about two-thirds of what was on the wall. I found that when a show was more than half sold, people tended to think that the best pieces were taken, and maybe they were right.
Back to the figures—I was totaling about $20,000 in sales, and my overhead was $10,000 without salaries. After the artists got their cut (50%), my profit was a little more than $10,000 since I always showed and sold my own artwork, as did my girlfriend and partner at the time. So I was left with $10,000 profit which just paid for my overhead—I had broken even. Then there was sales tax and other minor costs like repainting the gallery regularly to make it look good, and I was now losing money. I ended the year in debt even though the artists made money and the gallery appeared to be successful.
My error was that I needed much more work to sell! In every show, I should have had twice the amount of work as I had to sell. That means I should have been able to pull work out of the back room or take it down as soon as it was sold and replaced it. I wanted the gallery to operate like ones I had seen in New York, where the work stayed on the wall until the end of the show. The problem with that model is that you need to either sell work for high prices or have much more in the back room.
This was a big lesson for me because when I saw work selling every week, I assumed I was doing very well, but in fact I wasn’t. The next year of the gallery did better. The prices of all the art was raised, and there was much more on hand to show people. I began to earn a profit and the gallery lasted for several years.
As you can see, there are many ways to engage a gallery, and this last way is one where you can start your own gallery, and is a very different model that is being used more and more these days. If you look up the story of Peter Lik in the New York Times, you will see his recipe for success in this arena explained quite clearly. If that is something you are interested in, I would suggest you consider having a partner or two in the business.
For all the other methods of finding a gallery that are mentioned in this chapter, keep in mind that it is ideal to have several galleries showing your work and not just one. I often hear artists saying a version of, “I have sent them work and am waiting to hear the response,” but do not wait to hear the response of one gallery: keep following up until you get a response. As I have said, there is nothing uniform or regular about what galleries want, so don’t hesitate to walk in and just begin talking to people and asking if they look at the work of new artists. There is no harm in asking, and the truth is, the more ambitious you are and the more you ask, the better your chances will be at showing and selling work through a gallery.
Be bold, get out there, and don’t ask for advice from galleries or ask if your work is good; just be enthusiastic, use your charm, and know that your work is good already and the only question that has to be answered is if the gallery wants to sell it.
If you are still wondering if having “the right introduction” is what you need, or “knowing the right people” or something like that, then you might be waiting a long time. To get a gallery now, and see things happen soon, you need to pursue the galleries you want; and if you want an introduction, then become friends with an artist in that gallery—otherwise you might be waiting a long time, and who has time to wait? You need to exhibit now!
To learn more about Brainard Carey and his services for artists, or to take a class from him, click here. To join one of his free weekly webinars, click here.