An art gallery is a business where works purchased from various artists are resold. It can be paintings, sculptures, drawings, jewelry and even applied arts. The specific type of artworks in a given gallery is determined by its owner and tailored to the expectations of the target group. How does an art gallery work?
The owner of an art gallery should first of all define the profile of his activity. Its task is to select works that will be on offer and to adapt the premises to the expectations of specific recipients. If the gallery includes contemporary and classical artworks, abstract and folk, the result will be an unattractive mixture. The gallery will turn into a shop where, instead of admiring art, only home accessories are selected.
Refined art, targeted at a narrow audience, is presented in galleries in exclusive buildings, ensuring peace and privacy. For this group of customers, the most important thing is the ability to freely interact with art and discretion. Buyers of exclusive artworks usually want to avoid publicity and meetings with journalists, fans or paparazzi. The artworks of less known artists, dedicated to a wider group of customers, can be presented in an art gallery in an office building, at a train station or at an airport. It might as well be operating in another part of town or offering artworks for sale online.
The business model in the case of art galleries is to earn money on resale of artworks by various artists with a certain margin. The commission on sales, depending on the value and interest in a given work, can range from 10 to even 50%. It is the main income of the gallery. If the gallery has valuable paintings or sculptures from ancient or medieval times in its collection, it can also earn money for the possibility of viewing them by visitors. In such a case, even a long period without the sale of any art work does not mean the bankruptcy of the gallery.
The art gallery derives the greatest profit from the sale of valuable artworks by famous artists. Sometimes you have to wait a long time for the buyer, but valuable works are a good investment, even if they are only viewed for several years. Their price increases over time, which is why they are an interesting alternative to traditional methods of investing capital. Thanks to this, you can achieve profits of several dozen percent. In the case of lesser known artworks and creators, the art gallery limits the amount of commission to maintain continuity of sales. Otherwise it is difficult to stay in the market.