Running an art gallery during a global recession requires a set of unique strategies that are not applicable to the average small consumer-based business. Since art spending is discretionary income, an economic downtown can hit galleries, dealers and artists hard.
Here is how you and your art gallery can climb out of the recession with these top 10 recession-proof strategies for art galleries.
1. Cut Overhead
In tough times, you need to spend less. Cut out unnecessary expenses and lower your overhead. Rethink your printing, shipping, advertising, and daily costs. Cut framing costs by having artists frame their own work, for example.
Some basic business advice regarding payroll taxes and business assets can apply to art galleries. About.com's Business Finance Guide Rosemary Peavler provides wise tips in her article: How to Keep Your Business Out of Bankruptcy - Tips to Help Your Financially Distressed Business.
Modern and contemporary art tend to follow market trends which can be unstable at times, while Old Master paintings do not.
London-based art dealer Charles Beddington recommends dealing in Old Master paintings. He says, "Old Masters, while not enjoying the periods of dramatic growth evident in many other fields, also do not suffer the downturns in the same way. During recent periods of recession the perceived reliability of the Old Master field has led many collectors in other areas to redirect their interest in this direction."
Traditional methods of running a gallery do not seem relevant in today's economic climate. According to Katherine Don, the co-founder and director of the RedBox Studio in Beijing, "Now, following the change in the global economies, the arts industry is forced to innovate and provide creative solutions for creating sustainability in the market, in production, in museum programming, in collections etc."
She advises that a gallery cannot be "merely sustained by investment and short-term financial gains, but needs to be sustained by patronage and long-term investment in the fostering of a cultural community."
Speaking about her private organization, she says "We provide graphic design and art advisory services. We work with artists, collectors and institutions to facilitate acquisitions, exhibitions, art programs, and publications. Our services include bespoke art experiences, collection management, exhibition organization, art publications and public art initiatives."
4. Print on Demand
Bangkok-based gallery owner Jorn Middelborg recommends a novel way to beat the recession. He says, "Books and catalogs are an integral part of a gallery's work, but expensive to print. Thus, we have found that publishing catalogs on the website as pdf-files is a way both to save costs and also the environment. The files are easy to view and download, and can be stored in the computer for an infinite period of time, without taking up much space."
Not only is it a cost-effective solution, it can reduce storage problems. He says, "In addition to the low resolution pdf-files on the website, we make high resolution pdf-files which can be used to print copies of the catalogs. They are printed in digital offset, which means that we can print as few or many copies as we like, such as e.g. 20, 50 or 100 copies. It is a system - print on demand - whereby we print more copies when there is a need for it. This is better for us than printing 500 or 1,000 copies which is often done, and one is left with a large stock which takes time to disperse."
5. Show Your Money Makers
A recession may not be the best time to exhibit your most experimental or controversial artists, nor is the time appropriate to show your emerging artists that are yet unproven in the marketplace. A conservative business choice is to stick with your tried-and-true strong sellers. This strategy of exhibiting your popular and best selling artists is to ride out the recession without going bankrupt.
The Princeton Review describes the job description of an art dealer.
6. Become a Private Online Dealer
You have the connections: the Internet and collectors. Maximize them. As more people are getting comfortable with doing online business transactions, it is a good time to set up an online art gallery.
A Bloomsberg Businessweek article highlights the story of one such profitable online art gallery.
The American Association of Museums describes the online business strategies and partnership of NY's Museum of Modern Art (MoMA) and the UK's Tate Gallery.
Refocus your mission statement and business plan. Rethink what works and what does not. Trim the excess and make your gallery stronger and leaner.
About.com's Business Finance Guide Rosemary Peavler advises how to develop a new business plan in her article Tweak Your Business Plan in a Recession - Presenting your Business Plan to a Bank in Troubled Economic Times.
8. Run Exhibitions Longer
Reducing your yearly schedule by a couple of shows helps to save on operating costs. Instead of having an exhibition run for the typical 4 weeks, have it run for 5 or 6 weeks instead. Your advertising, publishing and shipping costs will be reduced.
This is a subtle strategy as most gallery visitors will not realize that your longer exhibition has a cost-cutting purpose.
To learn more gallery strategies, Sotheby's Institute offers courses in art business and gallery management.
9. Be Innovative
Stand out from your competitors. Do not drastically lower prices as you will only destabilize the market; instead, be creative in expanding your business and connections.
For example, the owners of Kings Framing and Art Gallery in Ontario not only exhibit and sell art, but they offer art classes, create public art works, and run a framing and art supply store.
Rethink your priorities. Is this a good time to retire, take a sabbatical or even get into a new line of work? How about returning to school and updating your job skills?
About.com's Job Searching Guide Alison Doyle suggests viable choices in her article Changing Careers in Midstream - Career Change Options. She explains how taking a risk may not be so risky after all.