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Sunday, July 11, 2010

Setting and Raising Your Prices

How to Sell Paintings, Sculptures, Photographs, Digital Prints - Setting and Raising Your Prices
Q: My goal is to work full-time as an artist selling my paintings. Currently, I work at an unrelated job during the day and paint during the evenings and weekends. Please give me some strategies for increasing my income, particularly methods that I can use to periodically raise my selling prices.
A: The most important point to keep in mind when pricing and selling your paintings, photographs, giclees, watercolors, sculpture, or whatever kind of art you make is that you are one of many, many, many artists out there. No matter what kind of art you make, other artists make it too. Even though in theory you have complete control over how much you charge for your art and when to give yourself a raise, you must always consider the competition. Artists who ignore the big picture either price themselves out of the market to begin with or raise their prices so often and without adequate justification that they lose credibility with dealers and collectors.
Best procedure is to let the marketplace determine your selling prices and the intervals at which they increase. For starters, figure out how much artists with similar credentials and exhibition experience to yours charge for their work. For example, if you've been painting for three years and have had four shows, see what artists with similar experience and resumes sell their paintings for. Other variables to consider are the length of time you take to paint a painting, costs of materials, and other incidental expenses like framing and transportation. Using those values as a base point, experiment with offering your work at varying price levels and evaluate the results.
Basic marketing strategies may help you sell more art. If you underprice the competition, for instance, your art becomes more attractive to collectors. How much you decide to underprice depends on factors like overhead, the rate at which you make art, and the rate at which you sell. The less your work costs, the faster it sells; the more it costs, the slower it sells. Somewhere along that continuum are price levels at which you maximize your gross annual income and minimize turnover time (the time interval between completing and selling a piece of work). You decide through experimentation what those levels are.
As an aside, if you take inordinate amounts of time to create your art or find that it's costly to produce, you might explore ways to reduce those liabilities. I occasionally speak with artists who report taking weeks to complete works of art that only sell for several thousand dollars each. For these people, making decent livings is difficult if not impossible. Add to this the additional problems they have producing large enough bodies of work to interest galleries in giving them shows. One option here is to reduce production of the time-consuming expensive art and add selections of smaller, easier to create, more modestly priced work.
Once you settle on a comfortable price structure, a good point at which to raise prices is when at least half of what you produce sells within a relatively short period of time after completion, say six months or less. Another good time to think about charging more is after you have a show where at least half of your work sells. A ten percent increase would be reasonable under such circumstances, twenty-five percent would probably pushing things a little. (Reasonable price increases keep your biggest fans in the game-- those who've been buying you art the longest-- an important long term objective being to steadily increase the numbers of people who buy your art.)
If you raise prices too much too fast, you risk scaring off your most serious dedicated collectors, pricing them out of your market. Instead of continuing to support you, they stick with what they've got, get all giddy about how much it's gone up in value, and search out new and more affordable artists in hopes of duplicating the good fortune they experienced with you. Remember that these collectors are the ones who are most responsible for whatever level of success you enjoy today-- they kept you in the game-- so don't forget to return the favor and to keep them coming back for more. You might even think about offering your longest standing supporters special price breaks or buying opportunities from time to time.
Some artists raise their prices a fixed amount per year, say ten to twenty percent. Arguments in favor of this practice center around offsetting increased costs of living or receiving annual raises like other working people. These are not necessarily good reasons. For one thing, employees whose job performance does not improve over time do not get regular raises. In fact, they may even lose their jobs. If you don't visibly improve your work, your exhibition record, and your sales volume to the point where the art community takes notice, raising your prices becomes arbitrary and unjustifiable, and could jeopardize your chances for success. When you up your prices, you'd better be able to demonstrate that those increases are justified. Experienced dealers and collectors expect tangible proof that your art is actually worth more.
Through all this, remember to provide different but consistent price structures for wholesale and retail buyers. In order for dealers or galleries to represent you in any way, you have to offer them discounts they can work with. If a gallery shows your art, for example, then collectors who buy directly from you, with the gallery's permission of course, should pay the same prices that the gallery sells your art for. No dealer will show your art if you sell privately at prices below what they ask at their galleries.
As for quitting your day job, that's a luxury few artists can afford. Hopefully you understood the level of difficulty involved in establishing a successful art career before you got involved and did not overfocus on that small percentage of artists who are fortunate enough to sell their paintings, sculptures, photographs, giclees or whatever types of art they make full-time without supplementing their incomes. The most important thing for you is to hang in there and keep painting. Sooner or later, perseverance, sensible pricing, public exposure, and consistent sales translate into recognition and profits in the art business.

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