Artist & Gallery Pricing

[Dave W.]

I'm a new framing shop owner (well, I'm not new and neither is the shop) and am curious how others approach the artist and gallery community from a pricing/discounting standpoint. The previous owner did nothing in this regard. I read somewhere that an artist would expect 10% discount but that seems very thin since they're trying to resell the work and in many cases the frame can the majority of the cost. I'm in a very "artsy" area and believe this is a market I need to play strongly in.

Sure would appreciate any help y'all can provide. I've been lurking in the background on the Grumble for a couple of months and the info/help here is wonderful. Hope I can contribute as time goes on.

Many thanks,

Dave Whitaker

 

[Ron Eggers]

Hi Dave,

Welcome to The Grumble. Let's play with some numbers.

Let's say your average ticket is $100, for the sake of simplicity. Let's say your net profit - your take-home before taxes - it 30% of your sales. (That would be good, I'd say.) And let's say you do 1,000 of these each year for a gross of $100,000 and a take-home of $30,000.

Then let's discount those orders a rather conservative 10%. I think you're right. The artist probably isn't going to be thrilled over a 10% discount. Remember that the discount is going to come out of your profit (your take-home.) Your overhead and materials are going to stay the same unless you're doing so much volume for the artist that you're buying better.

If you do enough 10% discounting, your net profit goes to $20,000 per year and you've taken a 33% reduction in profit. That's because you're still doing $100,000 per year in framing, but you're only charging $90,000 for it and your materials and overhead are still costing you $70,000.

On top of that, the artist is probably going to cause you more grief than 10 regular clients who are paying full price.

The only way you can discount for this or any other type of customer is if you track the discounts and build it into your pricing. If you discover that your discounts are totalling $5,000 per year on $100,000 in sales, you need to raise your prices 5% <U>across the board</U> to compensate.

 

[Jason Maranto]

My approach to this is to have a "value" line which I buy in bulk and can therefor sell at a lower price point than regular custom framing.

Some customers don't like the small range of choices I provide in my "value" line but if you want custom framing choices then you pay custom framing prices... nobody, not even my own wife gets a discount from me -- but then my prices are pretty good to begin with.

Jason.

 

[Ron Eggers]

Jason's idea reminded me of something I do that artists sometimes like - though it's not limited to artists. I keep a couple of rows of corner samples of moulding that are available from my regular vendors - Evald and Gemini, in my case - as ready-made frames. Both these companies deliver weekly, so I'm no tempted to inventory these. I get a decent mark-up on these and the artist is saving money, provided they work in common sizes (which is typical for those working on canvas.)

I've stepped back quite a bit from the days when I inventoried a bunch of ready-mades, but I make them available for those who are more concerned with price than with selection.

 

[Dave W.]

Thanks for the input. Ron, I don't argue with your math, but I'm looking at this market as purely incremental. That is, I've got virtually 0% share today, so any profit, albeit reduced, would be incremental to existing work. My volume is such that I can absorb the extra work without additional operational cost.

Do you not discount to artists or galleries at all? What % of your business is that market - I gather it's fairly small from your comments.

Again, many thanks for the help!

Dave

 

[Ron Eggers]

Dave, I give legitimate artists a 15% discount. To qualify, they should have a Wisconsin seller's permit, actually be showing and selling somewhere and have already established a buying pattern in my shop.

It IS a small percentage of my business, but the cost of this discount is considered part of my overhead and my prices are adjusted accordingly across the board.

 

[Jon]

Hello. I thought I would share, as I have been on both sides of the register here. I am a professional photographer that now has a gallery and frame shop. I started this because I found I couldn't afford to go to retail framers locally and keep many of my clients. I have now delt with several artists who had big jobs. They actually were able to buy the materials with their resale license and then bring it to me to do the production. I don't deel with them being picky about materials. I simply charge them for my time and expertise, and they don't have to purchase equipment and rent space. Obviously we try to make money on materials, but this is a solution for a few customers that can produce income with no cash outlay, perhaps when its slow.

Jon

 

[Reynard]

The bulk of my business is from artists.Many of whom are full time and a couple of whom are "big" names certainly in Britain and definitely in Scotland.One in particular was using my old boss when he was a student and has continued to use me many years down the line.He was looked after way back then and he looks after me now.I appreciate that it doesn,t always work out that way but t depends on what type of framer you want to be.I enjoy art and talking with artists and whatever.My wife went through art school and enjoys knoking ideas around with other artists.Most professional artists in Scotland are requiring the highest quality hand made frames now.There has been a big resurgance in the past ten years or so to the point where many galleries refuse to hang a machine finished moulding.I hear a lot of the framers in here saying not to touch artists with a barge pole but frankly without them I would have a pretty lame businessI work with my wife in our shop and we have a good standard of living.We want for little and we enjoy what we do.Its flipping hard work but we feel its worth it.What we do sets us far apart from the other framers in town and we have bulit a good reputation for being quality framers (if a little slow at getting some orders out)who can produce something a but different.

All the framers I know in Scotland who have gone for the artist target market are busy to the point of pulling their hair out.I offer discounts depending on quantity ,time scale,type of framing required etc etc.There are a lot of timewasting folk who call themselves artists and I never discount them at all.I only discount students or professionals or people who are seriously into it.On average I frame an exhibition a week varying in size from maybe half a dozen pieces to maybe thirty or so.

Its all repeat business as well.Once they hit a winning formula with you they come back.And they keep coming back
Sorry about the ramble here.I,m tired and going to my bed.