Two gallery owners who beat the odds in New Hampshire share their secrets to success. The upshot: work strictly on a consignment basis and turn your stock over completely every month.
In case the link dies down the line, here’s the story, cut-and-pasted from the Seacoast Online.
Susan Schwake laughs when asked what business model she followed when launching artstream, a fine art gallery in Rochester.
A business plan? Yes. A “model?” No. Fine art galleries are not like most other ventures, she said.
As “Artworld Salon” (an analysis and debate Web site) noted, there is a lack of independently verifiable data regarding the art gallery trade. Hence little can be written, and much is guess work. One piece of conventional wisdom, shared in Don Thompson’s “The $12 Million Stuffed Shark: The Curious Economics of Art and Auction Houses” is that four out of five new contemporary art galleries will fail within five years.
Artstream is at year eight; Three Graces Gallery in Portsmouth owned by Kim Ferreira is at six, which gives their insider’s conventional wisdom some weight.
There are a number of things that set galleries apart from other businesses, though they generally share similarities among each other, both women said.
The major common denominator is the need for a near complete change in stock each month, a business practice that drives much of a gallery’s model. It’s the reason its individually selected stock is nearly all consigned, said Ferreira. (The percentage varies, but common practice has it at 50/50).
Due to this arrangement and the personal nature of the product sold, the relationship between a gallery’s owner and its suppliers, as well as its buyers, is more important than in most businesses, Ferreira added.
For its part, a gallery provides its artist with promotion, insurance and, in some cases, numerous points of sale. For example, artstream does corporate sales. Nearly all sell on the Web, and some promote at national art exhibitions.
Many galleries diversify, but both Ferreira and Schwake say at least in their cases it’s by choice, not for the lack of a healthy fine art trade.
When Ferreira bought her business, it was a frame shop with a gallery component. Her business plan was to grow the art. Eventually she stopped framing to focus on the gallery.
In addition to sculpture and wall works, she offers “secondaries,” high end, one-of-a-kind items such as jewelry, pottery, furniture and handbags.
This is a fairly common practice among galleries outside major cities, though a few locally, such as the Banks Gallery in Portsmouth and the George Marshall Store Gallery in York, Maine, are nearly exclusively fine art.
Both Ferreira and Schwake, who also carries artisan crafts, feel they could survive solely on fine works. Artisan items are an enhancement choice and a service to their collectors.
In another model, Nahcotta, now 10 years in downtown Portsmouth, was originally designed as a gifts and specialty household goods shop, with fine art constituting only 20 percent of its business. Today it’s best known for its fine art, with the gallery doing 50 percent of its trade, according to owner Deb Thompson.
Artstream’s business plan always included a number of facets. Schwake and partners Mary Jo Munsky and Rainer Schwake designed it with a gallery, Artstream Media Design and art lessons in a large, bright room to the back of the gallery. Each has increased business annually.
“And yes, the art gallery would survive as a gallery (alone) because of how we do business,” said Schwake.
Ferreira also has a sideline, Olive Tree Web Studio, which she works from behind the gallery desk. It was not part of an original plan, but grew out of her own Web site design. “But I’m not aggressively looking for it, and I don’t know if it’s needed …; to keep the gallery going.”
Computers have become an invaluable tool for galleries. The reason is obvious. Google any gallery and you get a virtual walk-about.
“When I opened, I didn’t even have a Web site,” said Ferreira. “Today I use it all, social networking media, image posting on sites like Flickr, my blog, Twitter, all of it. I’m on it all the time.”
“We do all kinds of networking. …; You have to work every angle,” Schwake affirmed. “I’ve been blogging for five years. That’s a long time. We have a presence (internationally) through that blog because of its age.”
Both confirm gallery sites generate sales, both nationally and internationally.
“If there’s a big trench outside because of construction, or it’s snowing, maybe no one comes through the door, but 10 people from all over the world check you out,” said Ferreira. “You’re still open.”
The computer is also valuable for finding artists. A strong gallery develops an overall, individual look. “You can’t pick a painter up off the street, you have to think about who works with who,” said Ferreira. “You need talent that complements your stable of artists. Surfing the Web works.”
In addition, computers help a gallery keep up the all-important relationship with both artist and collector.
The things galleries share with all other businesses is the need to be watchful and adaptable. For example, a few years back Ferreira noted a drop in large canvas sales. She requested smaller work form artists, rather than lower prices. “Their work is worth what it’s worth,” she noted.
And both Ferrier and Schwake acknowledge that the business requires near constant hands on involvement; gallery owning is not for dilettantes.
If Ferreira were to give advice to someone interested in starting a gallery it would be “be true to yourself and sell only what you’re passionate about.”
Schwake’s advice is “do a business plan, and educate yourself,” go to seminars, research, even check out Etsy’s tutorials. “Get that education …; and love what you do.”