Artists Need To Be More Business Savvy

Part of what I have tried to do for the last 15 years is to help my fellow artists become more business savvy.   Even artists that seem to have their acts together astonish me in their lack of understanding of how the art business works.  One of these artists that I rep recently got involved in having a few giclee prints produced.  I just got one of them in for my gallery and had not yet had a chance to inventory it when a client came in and showed interest in buying it.  I quickly called the artist to get a price and she came back with a sum that I thought was not very saleable.   I explained that for its size of 18×24 inches I thought that $750 was way too high.  I said that I’d try $650 but was not too hopeful.

It didn’t sell so I took the time to send her an email in which I asked if she could come down with that price.  She answered my email by sending me a full break-down of all the costs involved in getting the print produced. Besides the printing and stretching costs, she also included the setup charges such as the initial scanning, color-corrections, and a fee for developing the museum-wrap, border design.   Thus, it became clear to me why her pricing was too high.   She had taken all her costs including all one-time setup fees and doubled them to come up with her wholesale price.  Setup charges should never be considered when  calculating a saleable price for your prints.

There are two ways of looking at these setup fees.  One is to determine how many prints are to be in its edition and then divide the costs by that amount.  The second way, and one that I find to much easier, is to think of these one-time fees as the cost of doing business. However, since you can never be sure how many prints you will actually sell in any given edition it is always better to base your pricing on your printing costs alone.

The following is a reasonable example.  If an 18×24 inch print costs $110 the suggested retail price should be 4x that amount, which would equal $440 or slightly more depending on your shipping costs.  Thus, your commission on a gallery sale should be approximately $220 to $230.  Two sales should allow you to recoup all of your setup costs.  After that you will be making a net profit of $110 on every future sale of that particular print.  Further, if it’s a saleable image and you manage to sell a dozen of them, then you will have earned $1,000 for simply ordering a print!

When I related this story to my son, who used to run my fine art giclee printing company, he was kind of taken aback by this kind of thinking.  He came up with a great analogy, one that really helps to bring this argument home.  He said, “Well if you follow that line of reasoning then I would hate to think what the first hamburger served by a newly opened restaurant would cost?!?”