50 – 50 Split by William Dolan

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The creator of the Rolls-Royce, Henry Royce got second billing to his business partner that sold them, Charles Rolls. The businessman that saw potential got top billing and the car is often referred to as a “Rolls.” Does that mean that the seller is more important than the creator? If you ask many people in the art world, the answer would be yes.

Throughout history, art dealers have taken advantage of this situation. Artists are grateful that dealers would give them the opportunity to sell their work and in return the artist may have a career. The artist thinks that a 50 -50 split isn’t such a bad deal, especially when there is a preconception that artists would live in obscurity and be lucky to get “anything” for their work.

However, is this the way it should be?

Well, no and yes. The value of art is not fully determined by the amount of labor, time, experience or knowledge of the artist. It also has a lot to do with the reputation of the artist—this equates to the résumé. And this also brings up some important questions: Where has the artist shown? Who is the artist? Is this artist growing in stature?

It would be nice if those buying art had intuitive judgement and would buy “serious” art simply on the fact that they know good work when they see it. But sadly most of the art sold amounts to framed posters, furniture store paintings, prints from IKEA and Target, etc. We want the buyer to be inspired by “serious” work, to get the “message”, to understand the quality. Viewing the work should be as important to the buyer as making it is to the artist. The buyer/collector HAS to have it just as the artist HAD to make it.

Unfortunately, this does not work in the real world. Most buyers and collectors do not have a natural instinct when it comes to art. Moreover, most don’t really have any real knowledge about art-making in general. They need help when making decisions. They look for advice and seek guidance. The person they look to is the art dealer.

The dealer has a reputation for knowing what is good and what is not. It’s assumed that he or she has a keen eye and understands art. The Dealer is the Gate Keeper of the Art World. For better or worst, the dealer is like the man behind the curtain in “The Wizard of Oz,” Like the “Wizard of OZ”, though, it’s a sham, but like other aspects of humanity, most look for someone to lead them, even if the leader is incapable without hiding behind a curtain of bullshit.

Like it or not, (and until things radically change in the art world system) artists still need the dealer/gallery to establish a “serious” career. Buyers, collectors, curators, critics, etc. still put too much emphasis on the dealer/gallery. Until that paradigm changes, the art dealer/gallery system and the 50 -50 split are here to stay.

However, as time goes on and the artist’s career is established, collectors buy a work based on the artist’s reputation rather than the dealer’s credibility. Therefore, the 50-50 split seems to make less sense. If the artist is doing the work and the reputation and trust has now shifted to him or her, why should the dealer continue to take half of the proceeds. At this point, the dealer is acting mostly as an agent at best, a facilitator, if you will. As an agent, the commission should be more in line with other forms of agencies; more like 10 – 20 percent.

It wouldn’t be a bad idea to continually examine the dealer-artist agreement. As the artist gains in stature and the importance of the dealer’s influence in the artist’s career changes, there should be more of a sliding scale in terms of splitting the proceeds. Perhaps the artist can even leave the relationship.

This could be healthy for the art world. Even though the agreement is changed or dissolved, the fact that the dealer gave a start to an important artist adds to that dealer’s credibility. As a dealer makes less on a veteran artist through reduced commissions, there is incentive to bring on newer artists to make up for any loss in revenue. Though as prices rise for an artist works, the smaller percentage later on may be equal or greater than the larger percentage early on. I would think that in most cases, the value of the work doesn’t rise fast enough, leaving room for new talent.

I think this may be at the crux of why there is a perception among artists that there is not enough room for new artists. Dealers can continually make a handsome sum off of a few artists and do less work as their established artists almost sell their own work just by reputation. There isn’t a need to open up new slots.

Supposedly, the art market has been growing in the last few years, so I think there is room for new artists. With a constant flow of artists through the gallery system, we can supply the demand for art for decades to come and everybody gets their fair share.