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For an emerging artist, selling your work can be a daunting experience. When just starting out, it is often up to artists themselves to put a price tag on their own work, which means having a deep understanding of your market and the art market as a whole.
There are two schools of thought when it comes to pricing art: cost-based or market-led.
Cost-led pricing involves figuring out how long it takes to make the work, the costs of any materials used or overheads, then find a breakeven point for your work. This is the minimum amount that you need to sell the work for – any less and you’ll be losing money.
Name your price
But artists know that money is not the main reason you become an artist – if so, you’re in the wrong job! The wider art market dictates the price of work, so it pays to have an understanding of the market. Pricing artwork should be market-led rather than cost-based, said Daine Singer from Daine Singer Gallery in Melbourne. ‘Most artwork is priced according to demand, or what customers will pay.’
‘Pricing your artwork according to break-even analyses, mathematical formulas, or cost of materials and time would seem fair, but might also mean that the retail price has no relationship to what customers are prepared to pay.’
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Many artists begin their careers by exhibiting at independent artist-run spaces. These spaces usually receive funding through councils or grants, so they don’t rely on the sale of the artists work. This allows the artist to gain a reputation and build their market, without paying a commission.
Martina Copley is an independent curator in Melbourne. ‘Independent artists' spaces put the potential buyer in direct contact with the artist, and let the buyer get to know the artist before make a purchase,’ she said. This means that the artist has to begin to build their market, and manage their prices accordingly.
Market driven art
‘It is so important that artists learn how to manage sales and control their own market,’ said Copley. ‘You will need to manipulate your market so that the price of your work is steadily increasing, so buyers can see that you’re a worthwhile investment. At a commercial gallery you will get the advice, but when you are an emerging artist holding exhibitions at independent spaces, it is up to you to know and build your own market.’
Setting a price can sometimes feel like plucking a number out of the air, but much more research is required, said Copley. ‘Artists can start by looking at market prices for similar work, so if you produce watercolours or charcoal work, then look at prices for similar artists at a similar point in their career. Consider where did you saw the work – was it at a solo show, a public gallery? – and factor that into the market price.’
In order to be successful as a commercial artist and still have the time and money to make more work, artists essentially need to run their own business. ‘Artists don’t know that they have all these other skills. Artists need to book-keep, to have marketing skills, to budget, and be accountable for every bit of money they receive,’ said Copley.
Watch and learn
Seeing shows, monitoring prices and following the careers of artists who make work similar to your is a way to gauge your own market. ‘Often the more common ways is to look at the prices of other artists who are at the same career stage and working in similar mediums and then consider time and "market" value,’ said Brianna Munting, deputy director at NAVA.
Singer tells tell young artists ‘they are better to sell their work for low prices when they are starting out – as low as they can still happily part with it – and have their work out in the world.’
‘After all, you are better to recoup some costs than sell nothing. If you've underpriced at first you can always raise your prices, but you can never lower them. Generally I will set prices for an artist's first solo show quite low with the aim being to sell lots and generate buzz for the artist, before later raising their prices,’ said Singer.
Copley agrees. ‘It’s important that an emerging artist enters the market with room to move. So if someone buys your work for a certain amount, they will want to see that your work is 10% higher next time.’
Buyers like to see a steady growth in the price of the work, which can make the market quite separate from the work itself. Often – but not always – the sale prices reflect a development in the artist’s work. ‘The "market" forces, and these can include gallerists, secondary resale results, auctions amongst others like media, exhibitions and upcoming projects, can affect an artist's price. You would hope to see that as an artist develops that the price of their work would increase as well. Whilst this can happen, many artist are still subject to "market" demand,’ said Munting.
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Once an artist moves from an artist-run space into a commercial gallery, the gallery will take a commission of the sale. This takes the hassle out of researching and managing a market, but it also means that an artist might have to wear the cut for a while, as upping the price of the work to accommodate a commission can negatively affect their market. ‘There needs to be constant, steady growth,’ said Copley.
Commissions are paid to a gallery for the work they do for an artist, said Munting. ‘So, as an artist, what it is about is asking, who is this relationship going to benefit the most? What are your individual needs as an artist and what would support you and your work?’
‘It is really important that up front artists understand what the gallery will deliver, when a commission is applied, how much that commission is and what will be delivered for that commission. In the Code of Practice, NAVA recommends rates of commissions for different circumstances, and these should be agreed to by the gallery and artist.’
Singer said that galleries help build and manage the career of the artists, freeing the artist up to focus on their work. ‘Artists are almost always going to earn more and have better careers with gallery representation than attempting to sell and market their works themselves,’ he said. ‘Galleries take a commission but are able to bring additional buyers and in many other ways build the career of the artist which in the long term helps their prices.’
The big bucks
While the emerging art market might seem like a delicate balance of supply and demand, the secondary art market is a whole other kettle of fish. Once an artist makes the big time, the works take on a life of their own, and prices baffle even the artists. German artist Gerhard Richter told the German daily Die Zeit he had watched the outcome of a recent auction at Sotheby’s in London with horror after an anonymous buyer paid £30.4m for his 1986 oil-on-canvas, Abstraktes Bild. ‘The records keep being broken and every time my initial reaction is one of horror even if it’s actually welcome news. But there is something really shocking about the amount,’ Richter said.
No one who had bought his works in recent years, he said, had ever contacted him to show an interest in him or his work, implying that they were only interested in the work’s investment value. He confirmed that often his works were among those bought as safe, tax-free capital investments and stored in art bunkers in east Asia or Switzerland.
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