The Role of Art & Antique Dealers An Added Value 4.3 The Retail Gallery
The traditional shop front retail gallery is in decline, while event-centred and online business has increased.
One trend emerging from the research, particularly in larger art markets, is that a number of dealers have closed their shop front premises and now deal privately from offices or homes. The main reasons given for this shift in business practices were:
i. The fixed and running costs of maintaining a retail presence in a visible high street of many cities have become prohibitively high versus low and variable volume of sales. Some dealers commented that this was part of a general trend for slow moving goods to move off the high streets, while others felt that it was driven by underlying changes in property markets, which made rents unsustainable and premises were being taken over by other fashion-related luxury brands.
ii. Foot traffic was too low to justify a retail presence. Many dealers observed that people do not visit galleries nearly as frequently as they did 20 to 40 years ago, therefore having a visible and central presence was less useful. (“Serious buyers never drop into the shop”.) In the 1960s and 1970s in markets such as the UK, it was common for the middle classes to go “antiquing” at the weekends and most buyers rarely bought directly at auction. Now, on the other hand, it has become much more difficult to get people away from their homes and offices to visit galleries, and many are happy to buy direct from auctions.
iii. The market is becoming “event-driven” and now centres on events such as fairs where dealers are making sales and meeting clients. Many dealers commented that the expenses to run a gallery (especially when travelling and attending fairs) are not justified relative to the sales made via this channel. (Some dealers reported that their gallery sales had fallen to as low as 5% of total sales.) Some also felt that buyers’ loyalties were shifting to fairs rather than dealers, therefore these events were becoming the new global loci for sales.
iv. The growth in the online medium has made galleries less important for some dealers. Many dealers conduct business with buyers and sellers via websites and email (and also by phone). It was felt that this reduced the need for a retail presence and prompted some to move to smaller, less expensive offices or lower rent premises.
v.
Some dealers felt that the move towards focusing on dealing services rather than simply stock was encouraging the decline of the retail presence of dealers. Increasingly for many dealers, knowledge, discretion, expertise, and intellectual value added were their key selling points, therefore “a brightly lit frock shop” added little to the offering. Dealers also required the freedom to work by appointment rather than being tied to a shop, so that they could devote time to travelling to fairs, visiting clients in different locations and searching for new works.
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In economics, the price elasticity of demand measures the responsiveness of the quantity demanded of a good or service to a change in its price. The demand for a good is said to be inelastic when changes in price have a relatively small effect on the quantity of the good demanded.
30 Historical & Future Perspectives
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