LONDON: While art businesses are finding new ways to function despite coronavirus lockdowns, a new study suggests that galleries worldwide are expecting to lose an average of 72% of their annual revenue.
The Art Newspaper conducted its research in conjunction with Maastricht University professor Rachel Pownall on 236 international art and antiques dealers and galleries during the second and third weeks of April.
The survey found that around a third of galleries globally (33.9%) do not expect to survive the economic fallout of the global COVID-19 pandemic, although outlooks vary across regions.
Respondents in the United Kingdom predicted the worst drop in their financial activity — by 79%, followed by Asia (77%), North America (71%) and the rest of continental Europe (66%).
Additionally, the study reported that two-thirds of small galleries were the most likely to close their doors due to the health crisis, while larger galleries with more than ten employees were expecting to get through the pandemic.
“Liquidity is key in surviving commercially. Business schools have long taught that ‘cash is king’ for business success, and short-term access to cash and availability of low interest loans are vital to ensure solvency.
“It is imperative that governments and financial markets provide cheap and plentiful access to additional financial support to all those who need it,” Pownall told The Art Newspaper.
While professionals in the art world are envisioning a post-pandemic slump, galleries of all sizes are collaborating to financially support each other.
David Zwirner has recently invited 12 independent New York-based galleries to use its online viewing room, without charging anything for their participation nor taking commission on sales.
“Platform: New York” allows selected galleries to put forth two works by a single artist that they are currently representing, most of whom have seen their spring shows canceled in the wake of the coronavirus outbreak.
Meanwhile, Sotheby’s is partnering with eight prominent New York galleries to launch the new digital marketplace “Sotheby’s Gallery Network.”
Among them are Gavin Brown’s Enterprise, Lehmann Maupin, Jack Shainman Gallery, Luhring Augustine, Kasmin Gallery, Petzel Gallery, Sperone Westwater and Van Doren Waxter.
Participating galleries will select works from artists they represent for purchase exclusively through Sotheby’s new platform, with the auction house receiving a flat commission based on sales.
Transactions of works priced up to US$150,000 can be completed immediately on the newly-launched platform, while collectors are invited to “enquire” with Sotheby’s for pieces above that price.
“As the art world continues to grapple with and acclimate to the circumstances of our current moment, we are proud to be able to support our gallery peers with this online sales platform, as well as offer Sotheby’s clients new and exclusive works of art through this partnership with many internationally-renowned galleries,” Sotheby’s contemporary specialist Saara Pritchard, who spearheaded the initiative, said in a statement.