22 May 2008

Why I have a day job

I recently came across an old business plan I did way back. It had a nifty formula for working out how to price your goods and services.

Ha ha, thought I, let’s look at the numbers for being a full-time artist. Let’s have modest ambitions and work out how much you’d need to sell to get the minimum wage ($25,000 before tax, about $480 a week in the hand).

You need to add two-thirds of the cost of materials (you get one-third back through tax) and then the dealer’s cut. Let’s say (a completely arbitrary) $2000 for materials and assume a dealer’s commission of 40%. If you were doing this for real, you'd work out the cost of materials properly.

Dividing $27,000 (wage plus costs) by 0.6 (to add the dealer’s cut) tells us that, to get the minimum wage, you need to sell $45,000 of paintings each (and every) year.

What if you have larger ambitions than the minimum wage? What if you'd like to live on the average wage ($45,000 before tax)?

You’ll have to assume that, if you’re producing work with a higher total value, your material costs will consequently rise. Let’s say to $3000, because some materials won’t rise much more than a basic minimum you’ve already factored in.

Dividing $48,000 by 0.6 gives you total sales each year of $80,000.

These totals allow us to work out how many paintings of a certain price you need to sell to meet your target. If the average price of a painting is $2500, you need to sell 18 paintings a year to get the minimum wage, or 32 paintings a year for the average wage. That’s a lot (and I don't sell at that price anyway).

If the average price is $5000, you need to sell nine paintings a year for the minimum, and 16 for the average, wage. At $10,000, you need five for the minimum, and eight for the average, wage. At $25,000, you need two and three respectively.

This seems a lot better, but the problem is that, as your prices rise, so the pool of potential buyers shrinks, especially in such a small market as New Zealand’s. Remember that you need to sell this amount of paintings at these prices every year at least until you’re 65 (assuming that the super’s still around then). For me, that’s 27 years.

So, even if my prices were at the giddy heights of $25,000, I wouldn't think I had it made. I'd be worried about selling all the time.

If, on the other hand, you get a job at more than the average hourly rate, you can work part time for the average wage and be able to paint and show what you like, with no regard to whether they'll sell.

Increased prices limit the pool of potential buyers in a highly unsatisfactory way. They select for ability to pay rather than appreciation of the work. For this reason, I'm strongly considering having an application form for people to fill out before they can buy a painting. I'm thinking that they'd need to disclose their religious and political views as well as explain why they want to buy the picture.

16 comments:

artandmylife said...

Elva Bett said that Rita Angus almost interviewed potential buyers before she would sell - I think its a GREAT idea. Of course she didn't have rent and only had living expenses but it was a fairly meagre existence.

I really hope that people who buy the 30million+ Freuds of the world actually love the work (yeah right)

David Cauchi said...

Good old Rita. That's the story.

I want an application form. We've got to fill them out when entering competitions or applying for funding – with stupid questions like 'Describe the body of work you are currently working on'.

Take the power back, I reckon.

Rose said...

Okay, but why do people's religious and political views affect their ability to appreciate your work. How about asking them to disclose their reaction to the piece and their reasons for buying it? I don't see why they should have to disclose something as personal as this for you to determine if they are appreciative enough of your work. Does this make you a bigot?

Rose said...
This comment has been removed by a blog administrator.
David Cauchi said...

Because belief systems are a crucial component of my work. But you're right, I need to word it better.

When it comes to religion and politics, I am a bit of a bigot, yes. My opinion of people is affected by what they believe. However, it's not what they believe that's important but why. I don't like the uncritical acceptance of received ideas.

That goes for art too. Down with the mindless followers of fashion!

artandmylife said...

Again I mainly agree with Rose "How about asking them to disclose their reaction to the piece and their reasons for buying it?" BUT if a National Front member wanted to buy my watercolour of Irises??? Dunno...

Rose said...

I take it further. What people believe, and why, is important, but even more so is what they actually do – how they live out their lives. Strangely enough, this does not always line up that well. Why? Because what people say they believe is not always so in actuality. The beliefs they express to others can often be about how they wish to be perceived. So can you believe them? Can you believe what they say on your form? Why not insist that you spend a day with them. See what kind of people they are. Make their friends fill in forms.

Come on, really, I find this silly. It's interesting as some kind of conceptual art - that it becomes part of the artwork in itself - but as a means of determining whether someone should own your work it seems absurd. Pointless and absurd, even!

artandmylife said...

Interview them in person I say - like Rita did :-) I hate forms

David Cauchi said...

There is something to be said for the interview option.

Time to rethink this. Damnit.

a camera in the world said...

Interesting idea. But then again, I kind of like the subversion that can happen when someone buys a work and then gains an understanding of the context later. And if that context reacts against there belief system and makes them think for a moment, isn't that a good thing?

David Cauchi said...

Yes, of course it's a good thing, and I don't want to preach only to the choir. I don't think I've explained myself very well.

The two most important filtering mechanisms are already in place: I'm not fashionable, and I'm not a good investment. I'm confident that the people who've bought my work did so because they get something out of it.

This idea started because I was annoyed by the silly questions that are asked on application forms for competitions and funding etc. Then I thought of the expectations of buyers, who often want to meet the artist or at the very least know something about them.

Well, this goes both ways. I would like to know something about the people interested enough in my work to consider buying it.

Rose hit the nail on the head when she said that this would become part of the work. It has definite possibilities.

I also want to retain some control over what happens to it.

Then again, I'm probably just being too precious.

No. 0003 said...

Never meet your heroes - always a disappointment...

No. 0003 said...

Never meet your heroes - always a disappointment...

David Cauchi said...

Oh, I don't know. Here's an exception.

a camera in the world said...

OK. re read your thoughts. I bought some of your work because it's great, I loved it and I know I can live with it on my wall for ever. Not that I have enough wall space for everything, but that's another story. So, can I volunteer to be the first to go through your application process?

And, like you I think that being not "collectable" is good, but sometimes bad. Good in that it means people like my brother in law, who thinks art appreciation is a 25% increase in the value of something he owns, stay away, bad in that people like my brother in law don't get something politically of spiritually subversive looking them in the eye regularly.

I like the idea, of the process of purchase, if that's the right wording, remaining at least somewhat under the artists control. You would be in good company, Rothko returned his commission from Seagrams when he realised that his paintings for the Four Seasons Restaurant would be little more than decoration and wouldn't spoil everyone's meal.

Cheers

David Cauchi said...

You got a couple of particularly hard to part with good ones too.

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