TEFAF joins Sotheby's in China

March 27 2013

Image of TEFAF joins Sotheby's in China

Picture: The Economist/AFP

Like most art dealers and auction houses, TEFAF [The European Fine Art Fair, at Maastricht] has for some time been trying to 'get more Chinese' to come and sample its wares. Now, however, they've decided to have a TEFAF fair in China itself, and in collaboration with Sotheby's. Not so long ago, TEFAF members used to resist vigorously any involvement with the main auction houses. But the new partnership is a sign of how things have changed, and the increasing dominance of auctioneers. More details on TEFAF Beijing in the Antiques Trade Gazette here

Meanwhile, China Daily has an interesting take on a recent selling exhibition at Sotheby's New York of Chinese art, seeing it as a move by the auction house into dealer territory:

The art work with fixed prices rather than being offered in the traditional auction is an attempt by Sotheby's to gain new business at time its auction revenue has declined. It's also a move into an area traditionally run by private art galleries: sales exhibitions. And it's drawing criticism from some gallery owners who deal primarily in Asian art.

"This will be an uphill battle," said Martha Sutherland, principal of M. Sutherland Fine Arts gallery. "We are in the bespoke business and we offer the personal touch." [...]

In 2012, Sotheby's reported total revenue of $768.5 million, which included auction and private sales. That was a decline of $63.3 million, or 8 percent, from 2011. The decrease was mainly caused by a $79.4 million, or 11 percent, drop in auction-commission revenue. Private sales were a record $906.5 million, an 11 percent increase from $814.6 million in 2011.

Henry Howard-Sneyd, Sotheby's vice-chairman of, Asian art, said the auction house doesn't see its move into sales exhibitions as a threat to galleries.

"There are new galleries being formed and galleries closing down all the time," he said. "It's a constant cycle. I think Sotheby's is being one of those new faces in that market place. It's just part of the ongoing innovation and creativity of the contemporary art market. "

Finally, in the Old Master world, dealer Johnny Van Haeften (in an interview with Art History Abroad) also sees increasing auction house dominance, and says the future is bleak for Old Master dealers:

Auction houses are doing so many private treaty sales now; what sort of impact do you think that has on dealers?

I think it’s one of the greatest threats to the dealing world.  Christie’s and Sotheby’s have both announced that 20% of their turnover comes from private sales, which is quite scary.

Do you think it’s affected the quality of their auctions?

Certainly the quality of the sales has reduced considerably, as has the quantity.  The availability of pictures is diminishing, and it’s difficult for us to compete with them.  There is an attraction that Christie’s and Sotheby’s offer – they say, ‘if you sell with us, it will be totally discreet and private and it won’t go to auction’, but if you go through a gallery, that would happen anyway.  I suppose their main argument is that they have access to more clients.

What about the future of Old Master dealers?

I think it’s fairly bleak.  As the availability declines, the cost price gets higher.  But I think there will always be Old Master dealers and there will always be people who prefer to buy from dealers – as soon as they realise that at auction the price can only go up and at galleries it can only go down.  We’ve noticed already this year, that buyers are starting to come back to galleries, because the intensity of the pressure to make up your mind by a certain time is not present in a gallery – you have a little bit longer, you can try it out in your home and you don’t have to take a risk, like a dealer buying a very dirty picture that doesn’t clean well and then being stuck with it.  There always has been huge competition between the dealers and the auction houses, and there always will be.

As I've said before, there is only one way dealers can continue to compete with auction houses, given that we cannot out spend them or out market them, and that is to out think them. That's what makes it such fun.

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