Book report: Management of Art Galleries
If you're in search of art for your home or collection it may be helpful to take the viewpoint of the gallerist, who struggles to operate in a hugely competitive art market that's actively shifting online. The book, "Management of Art Galleries" by Magnus Resch provides such insight and inspiration to the gallerists willing to face such a challenge.
Art has always been considered as a store of value and an investment. Notably, people buy art because they like it, however, the social construct around the piece may prove to be more valuable than the art itself. In the art market, Resch describes that the most valuable client to the gallerist is the art lover, a personal collector who amasses a personal collection over the years simply because they like art and find it as “a source of inspiration.” This is followed by one-time buyers, art dealers, investors/speculators, and finally museums and foundations.
Revenue challenges to art galleries are more intense than ever and 30% of them are running at a loss, according to Resch. Their largest expense is the rent followed by salaries and events. Art is sold on commission and often split with the artist evenly. Sometimes the gallery buys art directly from the artist providing them a stable source of income while sheltering them from the risks of no buyers. Galleries also face challenges when artists sell directly to consumers via Instagram and artsy. Private deals and auctions houses pose additional threats.
Galleries are more than a reseller of art, they are a central part of the art community and are “part of an industry that runs on trust and personal interaction with artists, customers, and colleagues.” If you’re collecting, consider supporting local galleries as they face growing online competition, rising urban costs, and low foot traffic.
At Eureka Wealth Management, I believe that wealth management is more than just owning stocks and bonds but that an art collection should also be considered and treated with the same prudence as any other investment. I also do retirement planning and give strategies on taxes and estate. Call for a free, initial consultation at (760) 537-0791 or online at eurekawealthmanagement.com.
"Management of Art Galleries" by Magnus Resch