It is always an eye opener to see a realistic evaluation of the costs for a work of art. In addition to all of the costs listed above, I have also read that an artists should include a percentage for taxes, income and state. It is a sobering amount that needs to be added to a painting just to break even.

Lori, I was just answering a reader question about this on Monday. It's sometimes tough to account for everything that you spend on a business, and then also account for your time.

Thanks for the kick in the pants on covering all expenses!

Two thoughts:
The concept of adding a percentage for profit is odd to me. When we do our taxes we cannot deduct "labor" as an expense. Our profit for the year will simply be our income less our expenses.
Secondly, I would like beginning artists to realize that their labor(painting time)price per hour will be based upon their expertise at painting and not on what they made per hour in some previous job. In simple terms, a person may have been power level paid attorney, but must start out as a fast food hourly artist.

I'm currently pricing my art with a sliding scale so look forward to your next post. Thanks!

Hmmm. This is a rather sobering article. So now we all need to run out and raise our prices. Just kidding! I guess I need to either reduce expenses or raise prices. Or of course, I can just sell more paintings!
Perhaps it is time to look at additional income options. Teaching, prints, etc. Lori - can you address these additional income opportunities in a future article?

Lori,

Thanks again for a fantastic article. Obviously, pricing is one of the most difficult things to do and stick with. We all tend to forget the little things that need to be added. And when someone wants a "discount" sometimes it's tough to say no, unless that "discount" is built into the price. It was once pointed out to me that if i give a discount, depending on how much it is, i may be paying the customer to buy my work...
We all appreciate your thoroughness in discussing this topic!!!!

The sobering thing is, many artists have to rely on a spouse`s income or a second job to support the household. It has taken me years to climb up in price. The good thing is I can raise them now comfortably, not too hasty though. There`s a balancing act to know when to raise prices enough to actually be able to support oneself as an artist without relying on any other income.
Thanks Lori for telling me that I need to charge for a little profit margin in addition to overhead expenses. I will use your word, 'expertise' to make myself feel validated about adding that percentage. There`s the magic word.

Terry, using Lori's info you now know what price you need for each painting in order to make a profit. This is YOUR business and you set your prices. You should listen to what the gallery owner has to say about prices but in the end, you need to make your own decisions

Thank you for this second part. I'm saving up all of this information. The way you break it all up is very helpful.

Oh boy! Just when I thought I had it worked out!
I think the level of experience and expertise of the artist definitely has to come into it, I see some new artists asking ridiculous prices when they don't even have a Cv or biography to speak of.
the thought that discounting is actually paying some one to buy my art is very sobering.
sometimes the prices accepted in the city areas is much higher than in country galleries. this is when it get frustrating.
I have some recalculating to do.
thanks Lori

Lori,
Thanks for the reality check, just before tax time.
When I was in the design business I became a master at estimating every detail involved in a project through several stages of work. I am yet to achieve my financial goals using these basic principles.

Prolific vs. We Are Not A Factory
I've run numbers on several artists, famous and successful full time artists I know.

Van Gogh, Kahn and Richtner. 120 to 140 paintings a year. 2 1/2 paintings a week. They don't reinvent the wheel for each painting, they will explore different versions in a series.

On average, you will sell 50 percent. Some of the paintings may sell two years later, but they don't factor into the current year numbers. Allow about 12 percent of the work to be on probation or lost in the process.

Pricing of different sizes. Rule of thumb $100 an inch. You have to price realistically against the competition, their reputation or other artists with a similar style. This needs to be reevaluated on a regular basis until we reach a plateau of demand for the work. Research and bookmark a lot of galleries and artists.

Figure out the hourly rate you think you are worth. Plumbers charge $45 to $75 an hour. On average how many hours does it take you to produce a painting of the same quality level of paintings you have sold. Then factor in materials,
travel expenses, mileage etc. Its a rude awakening. The great western painter Howard Terpning may take several months to research, set up and execute a painting, but they sell for $500,000 and the collectors are lined up before he begins. My point is the levels of the game and comparison may be painful and take the fun out of it, but you simply set goals you HAVE to reach with your own work.

Reminds me of the story of a lady on vacation in France. On her own exploring Paris she happens on a small hidden square and recognizes Picasso sitting alone. A once in a lifetime opportunity, she decides to approach him, apologizes for interrupting him, tells him how much she admires his work, but can't afford it. Would he consider doing a sketch on a napkin and signing it for her to cherish. Picasso does a quick dove sketch, signs it and says, that will be $2000. Shocked, she replies, but it only took you 20 seconds to do. Picasso replies, yes, but it took me 20 years to do it in 20 seconds.

Business as usual.

Lori,

Thanks for this. Another friendly wake up call provided by FineArtNews. It is helpful as well to read the other artist's comments. This is indeed very timely as I compile my expenses from last year, it will be interesting to calculate what my prices should have been and compare them to what I actually charged.

Sharon, you left off a zero. 16 x 20 @ $100 psi would be $32,000. I think that would be retail price, don't you? LOL

Hello Mike, I went to your website and saw you just sold a painting that was 19X22, in calculating that you say a minimum of $100 per sq inch should be charged, was it priced at $41,800? Or did you mean $10 per sq inch. Just curious. I do not know many artists in my area that charge more than $10 per sq inch for an original oil painting.

By the way, your art is gorgeous and very upscale. I am not saying your art isn`t worth that, you have a degree and 30 years of being a professional designer. Plus you may have built up a clientele that is used to paying large sums of money for contemporary art. There are art galleries I go to in Laguna Beach that have artist who fetch high sums. I also know an artist named Todd White who reaches $80,000 for his originals, he is a contemporary figure artist.

I have a book The Art of Howard Terpning, love his work! He can ask those prices, I`ve heard people wait eagerly for his next original.

I loved the story about Picasso, heard it decades ago, but it is funny everytime!

An artist needs to reach a top level in awards or have a great agent who champions the artist to receive such sums. They call them Blue Chip Artists.

I'm looking forward to next week's post.

Thank you for correcting my math. I did it in my head and not on my calculator. Better always have one handy.

What we have here is my failure to communicate.
FIRST I decide what I am going to charge for the painting.

For a painting that has a 22x22 inch image.
Sale Price: $2,200

50 percent to Gallery $1,100
Framing - $135 135
My profit is: $ 965

Most of my rectangular paintings scale up and down in direct proportion.

A 14x14 image is $1,400
It is $800 less than the 22x22 because it is
8 inches smaller ($100 an inch)

The price on my paintings is at parity with what other artists charge for similar sizes and style.
I looked at their price increases as they went up in size and found that for each 1 inch increase in size the the price increased $100. I then checked the theory against 6 artists and found it to be a good tool. The goal is to increase your prices 5 percent to 10 percent a year. I did and quickly hit the wall after 2 years. Several artists I follow have not raised their prices in the last two years. They would rather have cash flow.

At the end of the year I add up my out of pocket expenses: Materials, photography, framing, hotels, mileage, meals, shipping, books, studio rent, magazines, computer, web hosting. I deduct my sales and either have a profit or loss.

You can look at the painters price increases over a five year period as shown in American Collector
magazine as a guide.
Some artists hit a ceiling at $6,000 to $8,000 for a 4x6 foot painting. They sell a lot more in the $3,000 range. Minus gallery commissions they (we) must sell 4 paintings a month (Net $1,500 per painting) equals $6,000 a month to make
$72,000. Deduct your expenses of roughly (a guess) $20,000 to end up with $52,000.

Hope this makes sense. I not call me.
574.269.6755.

I'm not using square inches.

Lori,
I’m looking forward to seeing your sliding scale for “by the inch” pricing.
I ran through your list, adjusting for my expenses and labor, and found I am not charging enough for my paintings.
Looks like I need to improve the quality of my art so people will want to buy it. Since it isn’t selling at the current price, I can’t see raising the price.
Thanks so much for sharing!
Donald
PS: The only thing you didn’t add that should be in the mix is cost of advertising. You mentioned it at the beginning, but didn’t include it in your list when you did the math. Advertising can be a huge expense.

Donald, sorry I forgot what I wrote in the beginning. In my opinion, it doesn't make sense to advertise unless you have developed a style and have proven your work with sales.

Any ad campaign needs to be constant, and an artist needs to have a significant and cohesive body of work ready to sell first.

I did do a number of ads about 8 years ago. My paintings were probably good enough, but I didn't have enough of them ready to meet the kind of demand that successful advertising can bring.

It always looks better to have a gallery do the ad anyway - means someone with authority is saying your work is worth buying.

My experience with advertising is different. When I first started out I placed a quarter page ad in an art magazine and was contacted by a gallery in Santa Fe who wanted to represent me. It was the best money I ever spent on my career.

Hi Lori,
I wasn't familiar with John D Traynor so I googled him and got lots of listings for a John C Traynor. His work is wonderful.....Is that who you meant? If not can you post a link to the John D Traynor? Thanks

Casey, since your question was off the topic of pricing, i sent you an email to answer your questions.

I thought Part 1 on pricing was well done covering basics that apply generally. Here are my thoughts...respectfully... on Part 2. My concern is for the person trying to learn that has no idea what the limitations of any advice are. I'm using quotes from the article to make sense out of my reply....though it nmakes it longer. Don;t shoot me...here goes :)


Sometimes statements need qualifying or limiting to be valid or meaningful. If it's correct some times, is 'generally true', an opinion, etc. it should be stated as that. Many painters unique circumstances either allow for or dictate a different approach to some aspect of their career...such as pricing.

Covering All Your Expenses
"Many artists neglect to take all their expenses into consideration when pricing their artwork..." My website is listed so I'll rely on that for some credibility. Given that the material costs of producing a painting (oil or acrylic) are relatively low, what it costs you to paint it is immaterial; unless we're talking about extremely large canvases; and even then, if we're talking about the artwork of professional artists, if the size was so significantly large, the price increase for materials would hardly be noticed as a percentage. Fair market value of an artist's work should dictate the price. Fair market value is based upon many things. Lori covered these well in the Part 1 of this article.

I studied fine art at one of Canada's leading universities and also did a two-year graphic design course specializing in perspective. This education cost a great deal. Many things such as: my success in the marketplace, proven professional track record with leading galleries, sales record, strength of my work, natural talent and technical ability, etc. (along with many other things) affect my pricing, but my work is worth what it is worth. I cannot and should not pass along my educational expenses to buyers of my work simply because that is what it cost me to get to this stage in my career. Imagine having two artists whose works were almost identical in every way (regarding ability, strength of the piece, style, etc.), but one artist had an expensive education, the other was self-taught. Charging to cover educational expenses would have one artist clearly out pricing another artist for something that has nothing to do with the painting itself. If one's educational training has had significant worth in real terms, improving the artist's ability to paint... and therefore increasing the chances for greater price mobility, the reality of the marketplace would automatically reflect that.

Artistic education and increased ability of the artist seldom translate proportionately. 'Artistic education' does not guarantee improvement of ability and should not be taken as being an automatic given in an increase in the value of one's artwork.


Art Associated Travel
If I do a 24" x 36" painting which retails for $4,000, the painting does not become 'stronger' or more valuable because it cost me a few hundred dollars in travel and accommodation costs to do it. The buyer should not have to pay for this. It has nothing to do with the value of the painting.
COST does not equate to VALUE and shouldbn't be reflected in the price.

Miscellaneous Fees and the cost of doing business...other than adding up all of my business related expenses at tax time, I never give them a second thought when it comes to pricing my work. All of our business expenses; membership fees, website fees, etc. do not increase the value of our art. Raising prices relative to all of our expenses sounds great and in theory, but is of questionable soundness in reality. The COST justification argument is an easy one for every to want to buy into. Not to confuse art with manufactured goods, but things in the market have a fair market value and a cost of production. The price of artwork should not exceed the value of the artwork just because of the cost of its production.


" Let's say that I sell approximately 100 paintings a year. By the way, if I sell only 50, my prices will need to be higher to recover my costs. This is why artists new to running a business need to be prolific." Again, in general, for pricing to mean anything to the public, a certain size piece of any given artist's work must have an approximate value; we all know about the time arguments... some paintings take far longer to do, this is true and that should be handled independently of everything here. Arbitrarily pricing some paintings higher to compensate for weaker or failed paintings is not good pricing practice. The buyer should not be paying for failed paintings. This lost time/lost potential revenue is the nature of the beast. This is one among many factors which are often the decisive factors separating those who choose, and are able to paint professionally from those who do it recreationally.


"Since I'm selling this painting at a gallery, I'll need to double this figure so that when the painting sells, I'll get the cost of my materials and business costs back. What this means is that the painting price has climbed to $400 and we haven't even paid me yet for my expertise. This is why original paintings are not cheap. We are not factories." One of the biggest mistakes I see today in pricing, especially among amateur artists, is the following: Jack's painting is worth $200. He has a hard time getting his mind around the idea that he could possibly end up with less than $200 ... the worth of the painting. He's going to put it in a show where there is a 50 percent commission. Even though Jack's painting is only worth $200, Jack decides to ignore the reality of the worth of the painting and double the price so that after the gallery takes its commission he gets his $200...its worth/value. Ignoring all the other costs that Jack could add onto his $200 painting (which is only worth $200) to drive the price even higher, he raises the price to $400. The buyer is now expected to pay double what this painting is actually worth...based on the caliber of the art and the ability of the artist; yes, that means, based on the actual artwork not an endless list of miscellaneous costs associated with creating it.

Artists need to understand that there is a price to be paid while getting established. Starting out, it's seldom does seem to pay. That's a reality that is the nature of the beast. As artwork improves and demand increases, prices will reflect that. The higher prices go, the greater the margin for being able to offset expenses to some degree. That the painting should be sold for what it is worth and that the artist will only receive half of the value of the painting is the reality of the cost of having someone else sell your work. Gallery owners are usually the ones having the higher expenses; renting a building, lighting it, heating it, and all other business related expenses. Please don't mistake this as being justification or support for gallery owners. Having shown with some of the top galleries in Canada, it was always understood that the 50 percent commission (10 percent higher than normal/non-high end galleries) was not just about paying them for selling the painting. Fully appreciating all the added expenses that come with the locations of these galleries, it was more about the fact that these galleries due to their market positioning, have the ability to establish artists and 'put them on the map'. And that is a reward worth paying for.

Pricing isn't simple. I think one of the biggest problems anyone has in trying to write about pricing is of perspective.

Kindest Regards,

David

OK so I just read David's comments again. I've worked with galleries who have huge expenses - like $30,000/month rent. Sometimes that rent can be much higher. So I understand why galleries need their 50 percent commission. Many galleries have lower rents. They can afford to carry less expensive works.

However, even ten years ago, the galleries who though my work was good enough to show, didn't price retail for originals at $200. If an artist's work is worth $200, then I advise them to start out at outdoor shows, or other less expensive venues - in order to begin to gain a following. If no one follows, then it becomes obvious that the artwork needs improvement.

The obvious thing about selling artwork is that the work needs to resonate with collectors. In other words, it needs to knock someone's socks off. The better your artwork is, the easier it will be to gain a following, get into galleries, and raise prices.

I have a client who entered galleries selling with bottom prices at $1500 - upwards toward $7000. His work is as good as many established artists, but he needs to start at the lower end of the gallery prices. If his work was not fantastic, he would not have gained entry into the galleries in the first place.

OK... I'm a ramblin' here now. If I think of anything else, I'll type it up, but in the meantime, what do other artists think about some of the issues that David brings up. He has good points.
Lori

K and Lori,
I would also be interested in the answer to Casey's question. I'm in agreement with Lori that others probably would as well.

Thanks for all the great info!

Since you asked, here's the email I sent to Casey. This could start a whole new discussion because i'd like to hear what others have to say about this

Did you travel to each one before you signed on? Nope. I've never been to most of the galleries that represent me. I researched the galleries over the internet or they contacted me. and then i researched them.

Do you have a system for checking on your inventory in out of state galleries? Not really. I limit the number of paintings I allow each gallery to have (6) especially when I am first starting out with them. I try to stay in contact with the galleries and if a painting doesn't sell within 6 months or so I ask the gallery to return the painting and I replace it with a new piece

I know artists often worry about getting involved in galleries beyond their immediate geographical area. Yes, it can be scary to hand over your work to virtual strangers. But even a gallery down the street from you can close up over night and take all your work. I live in rural New Mexico and there are no galleries in my immediate geographical area. You need to keep your ears and eyes open. If a gallery isn't communicating with you are you start to get an 'icky' feeling about them, you should get out! It's really a matter of trust. If in doubt, contact other artists in the gallery BEFORE you place your work in their hands. Have a good contract (although contracts are hard to enforce if you don't have the money to pay a lawyer). I've had galleries wanting me to sign really poor contracts which just showed me that they were not 'professional' galleries. I give those galleries a pass.

K. Thanks for taking the time to add your email reply. It's very helpful and your advice is always right on.

Lori, or anyone else who might have experience with this. I have one more question about pricing but it's pretty specific.

I'm wondering if anyone has found a need for a considerable difference in pricing or acceptance in galleries of oil paintings versus acrylics.

I know people who have worked in both, pretty same style where possible, and have had varying experiences. I'm just curious what kind of market people are seeing for each and if it's maybe genre related.

Thanks,

Michael

Hi Carole,

Thanks for responding. I paint with oils and have never tried acrylics but can see a number of advantages to them. I'll go as far as to say I did ask one gallery that handles a lot of maritime paintings if they found the pricing different between the two and they said no. Having said that I've spoken to artists I know who have gotten exactly the opposite reaction and feedback.

Inquiring minds want to know...

Hi David,

Thank you. Not that I'm worried much about the pricing personally but I was curious. By the way, I was on your site and like your work very much.

Michael

Hi David, thanks for your reply. I do understand quite well everything you've explained about oils. In fact, I used oils for over 20 years. I don't find acrylics look plasticky (sp?) though if quality paints are used and the artist is adept at using them. In fact, most people have no idea my work is acrylic and don't believe it when I tell them. Like oils being properly used, the same applies to acrylics.

I have heard several times in the past though, through various articles, websites, forums . . . that galleries frown upon acrylics because clients do. Perhaps this was something that was more true in the past and is less true today. There are a number of well known artists who use acrylics and have above normal sales, and use acrylics (asides from Bateman).

So, hopefully this oil vs acrylics when it comes to pricing is a thing of the past.

Oh, and did I say I love acrylics? ;-)

Hi Lori,

Thanks for answering this one. I guess because most of the painters I know paint in a more traditional or representational style I think that way by default. I'm all geared up (quite literally!) to paint plein air and have never done so. I purchased some water soluble oil paints since they are supposed to dry faster and clean up easier than traditional oils but I'm wondering if I should have just jumped in with acrylics. Guess there is no reason not to true both. Thanks again.

Hi Lori,

Thanks again. Your reasons for the water solubles were pretty much my reason for trying them but I have to admit I probably fell victim to the hype about them drying quicker. Oh well. I do have a couple of mediums but thanks for the heads up on thinning with water because I'm sure I would have tried that too. Now if the snow, cold and wet will cooperate I can get out and try this... (and yeah, I know some people paint outside in all kinds of weather but ah, not me...)

Hey, I am enjoying all this discussion regarding oils versus acrylics. I love acrylics.. And, I am glad to hear that others like using them, too. Most people cannot tell if my paintings are acrylic or oils. I am teaching beginning and experienced artists to successfully use acrylics.
Oh and did mention "I love acrylics"!!!
I paint fast and appreciate the speedy cleanup.
Teddy