Collecting Art and selling art for, and from your collection, can pose some challenges, from time to time. I’ve recently been contacted by several people with an interest in art collecting, or in selling works that they’ve collected, or inherited. As far as collecting and buying art, I have a few suggestions.
Collecting and buying art
Number 1. But what you like. Buy what you can live with, and share your home, or business with. Because the artwork that you buy for your collection may be with you for a very long time. Maybe, for years. Maybe, for your entire life. So buy what you like.
Number 2. Never pay retail. Never pay full price. Always negotiate with the seller. If you’re dealing with an art dealer, there’s room to negotiate price. They have a markup that they are working with. See if you can get the dealer, the artist, or the present owner of the art that you want to buy, to negotiate a lower price. It doesn’t hurt to ask. Don’t be nasty about it. Don’t be rude. And don’t accept those kind of attitudes from the other party in the deal, either. Just ask. Most of the time the seller will deal.
Number 3. Try to focus your collection on unique, one of a kind, originals. But if you’re collecting limited editions, focus on artwork with small edition sizes. In other words, how limited is a limited edition if it has more than a few hundred copies in the edition ? Even if it has more than a hundred copies in the edition? If the edition size is so large that it’s run outnumbers a poster edition, than isn’t that limited edition from a large edition size just a poster with a number assigned to it ? From a supply and demand point of view, when you get ready to sell, if that work isn’t very limited in the first place, you’ll have a hard time getting back what you originally paid for it several years, or decades, before. That’s OK, if you’ve received years of pleasure and enjoyment from sharing your home, or business with the artwork, and it doesn’t matter to you what you get for the work when you need to re-sell it. But if you want to have a better opportunity to get what you originally paid, and maybe more, for the work, buy wisely.
Which brings me back to collecting unique original works of art that you enjoy. By unique original, I mean One of a Kind original works of art. You may pay more for the work than a limited edition, but being a unique original, if you need to sell it later, and someone else wants to buy it, they can only get that unique original from you. Why? Because there is only one, and you own it. So you are in a better position to establish a price that you want for the work, and not worry that your buyer is going to get the same piece from someone else that has a copy just like yours, or hundreds, or thousands, of other collectors with the same artwork. They can’t, because, once again, you have the only one. If they want it, they have to buy it from you.
Selling artwork from your collection.
When you get ready to sell, do a little homework, and don’t believe the hyped values for artwork that you may see at some galleries. Most of those dealer prices are full retail, and a price that most savvy collectors would never, ever pay. Why? Because they follow rule number two of buying. They NEVER pay retail. They negotiate. The art dealer knows that too. So they present a high retail price, knowing that they may have to negotiate a lower price in order to make the sale. and even after they’ve negotiated the sales price with the buyer, there will still be a profit margin for the dealer. That’s just the way of things. So, don’t look at those inflated values and think that you’re going to get that for your artwork when it comes time to sell. Think wholesale. Check auction records for prices paid at auction for works by the artist whose work you’re going to sell. Many times art dealers, and galleries will buy at auction, and markup the price in their place of business. If you want to compete with them for a buyer, then price your work accordingly. Be ready, and willing to negotiate. And understand this. Just because you paid x number of dollars 10 years ago for a work of art doesn’t mean that the market for that artist, or work of art, is the same now, as it was when you bought it. The art market fluctuates with the economy, and the value of your art will fluctuate too. Sometimes the value will be greater than what you paid. Sometimes it will be far less. Understand that. Accept that. and if you need to sell, take what the market gives you in value, and move on.
More than a couple of decades ago I had a very wealthy client who had invested a great deal of money with a company I was with. He was very good at making money, so I was surprised when he asked me to sell artwork that he paid more for, a few years before, for less than what he paid. He looked at me in a matter of fact way and said very plainly, without any emotion. “Not every investment makes money. ” It was a lesson that he had learned over a very successful business career. And it stayed with me. Not every investment makes money, so when they do, be happy. But when they don’t, make the best of the situation, sell for what the market is bearing now, and move on to your next adventure.