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5 steps to turning your art into a business – MarketWatch

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4 years ago

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This article is reprinted by permission from NextAvenue.org.

Transitioning from someone who creates art to someone who sells his or her art for profit can be difficult. As David Deeds, Schulze Professor of Entrepreneurship at University of St. Thomas, wrote in “To Turn Your Art Into a Business, Learn to Manage Your Time,” you may want to find a partner to help run the business. But in his new book, “The Paid Artist: How to Make Your Art Into a Business,” artist and self-proclaimed business geek John Endris offers five steps to get started on your own. Here is an excerpt from the book about them.

It may be painful to reflect on the financial aspects of your undefinable contribution, but by doing so you will take the guesswork out of your livelihood. This way, you can determine how much you need to earn or save to cover your expenses and create your goals and milestones around.

A few questions you’ll want to answer to help you begin making your art into a business: What do comparable artists charge? What is the minimum you can pay yourself? What have you sold your art for in the past? How much does it cost to produce one piece of art?

Five steps to launching your art business

Now, here are five steps to really begin your process of launching your art business:

Step 1: Profit and Loss (or P&<). This sounds difficult but is quite rudimentary. First, list out all of the art you have sold. Then total it and label it “total revenue.” Next, list all of your expenses to create it. (Fixed Costs are expenses that must be paid no matter what and do not fluctuate with demand. Variable Costs increase or decrease with demand.) Then total that and label it “total expense.” Next, deduct the total expenses from the total revenue. This is called your Net Income/Profit.

If you have more expenses than income (negative Net Income), you are a normal artist. Becoming established is challenging and requires intrinsic fortitude and motivation that impatient businesspeople do not have and can’t buy. Seeing the loss makes it real, which is good.

Pretending to be successful when you have massive losses will never help you turn things around. If you intend on doing projections or a budget, add a contingency for wasted materials and mistakes.

Step 2: Funding. You could list all the things you need, and then determine how you will pay for those things. You may not need to fund your business and be totally fine with everything you have got so far.

If not, this section can still help you explore your goals.

Getting a loan will be a challenge because you will be soliciting funding on speculative earnings. Will you use your savings? Or a grant? Are you seeking a grant or do you want to find one? How much do you need? Where will you get that funding from?

Here are some popular sites for artist grants:

Step 3: Profit Projections. This is an explorative puzzle to determine how many units you must sell at what price. The word break-even is scary, so use the word scoping instead.

By doing the competitive research, you will know the pricing for each type of business model and be able to guess at a potential income stream. You can also see what offering makes the most sense to spend your time on.

Hypothetical Art Sale Per Piece: $1,000

Desired Profit: $80,000

How do you make $80,000 in profit from a $1,000 piece of art?

Just like the Sales and Expenses Exercise from the P&<:

  • Sales: $100,000 (you tracked and totaled all of your sales)
  • Expenses: $20,000 (you tracked and totaled all of your expenses — $10,000 for studio rent/fixed costs and $10,000 for art supplies/variable costs)
  • Net Income: $80,000 ($100,000 – $20,000)
  • $80,000/$100,000 = 80% Margin
  • Margin = 80%

Test Equation:

  • Amount you want to make divided by your margin (80%).
  • $80,000/0.80 = $100,000 in Revenue is needed to make $80,000
  • Divide $100,000 by $1,000 = 100 art pieces sold (100/12 = 8 or 9 a month)

You maintained an 80% margin and sold 100 pieces at $1,000 to make $80,000

Step 4: Break Even. How many pieces of art do you need to break even? This is by far one of the most important aspects that nearly every artist leaves up to someone else to determine for them but shouldn’t. Doing this helps an artist understand what they need to charge for their work. It is also how you get paid to do what you love the most.

Break Even

  • Expenses: $20,000 (assuming the expenses are the same $10,000 for studio rent and the amount of supplies stays the same at $10,000)
  • Hypothetical Art Sale Per Piece: $1,000
  • $20,000/1,000 = Sell 20 Pieces (your art paid for itself)

Break Even and Paying Yourself

  • Expenses: $20,000
  • Your Salary: $20,000
  • Hypothetical Art Sale Per Piece: $1,000
  • $40,000/1,000 = Sell 40 Pieces (Your art paid for itself, and you to do it)
  • If you can sell 40 pieces, you can cover all of your expenses and pay yourself a salary of $20,000 if you sell each piece for $1,000 ($40,000/40). Sometimes, making more art will cost more (variable expenses). What if supplies cost more for more pieces? ($60,000/40) Then, you would charge $1,500 per piece.

Step 5: Tracking Your Income and Expenses. An accounting software called Wave is free, easy to use and has a simple user interface. It lets you enter your income and expenses for each business transaction you make. It is easy to use, and helpful for tracking expenses.

Once your transactions are there, you can make a P&< statement with a few clicks. You can also use Wave to create professional looking invoices.

If you only have enough interest to just track your income and expenses, you can hire someone to ensure it balances.

Related: How entrepreneurs can raise money for a new business—and the advantages if you’re over 50

Obviously, you cannot do everything yourself, and probably shouldn’t. Learning how to do taxes and financial analysis is not the best use of your time, and will take time from your art. As a businessperson, there is no shame in building a team around you.

Artists are usually too afraid to ask for help because they have probably gotten ripped off before.

John Endris is author of “The Paid Artist: How to Make Your Art Into a Business,” an artist and a business geek. He is a business strategy adviser, a serial entrepreneur, an active investor and has an extensive background in the financial services industry. 

This article is reprinted by permission from NextAvenue.org, © 2020 Twin Cities Public Television, Inc. All rights reserved.

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Calvin Lucyshyn: Vancouver Island Art Dealer Faces Fraud Charges After Police Seize Millions in Artwork

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1 day ago

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September 13, 2024

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In a case that has sent shockwaves through the Vancouver Island art community, a local art dealer has been charged with one count of fraud over $5,000. Calvin Lucyshyn, the former operator of the now-closed Winchester Galleries in Oak Bay, faces the charge after police seized hundreds of artworks, valued in the tens of millions of dollars, from various storage sites in the Greater Victoria area.

Alleged Fraud Scheme

Police allege that Lucyshyn had been taking valuable art from members of the public under the guise of appraising or consigning the pieces for sale, only to cut off all communication with the owners. This investigation began in April 2022, when police received a complaint from an individual who had provided four paintings to Lucyshyn, including three works by renowned British Columbia artist Emily Carr, and had not received any updates on their sale.

Further investigation by the Saanich Police Department revealed that this was not an isolated incident. Detectives found other alleged victims who had similar experiences with Winchester Galleries, leading police to execute search warrants at three separate storage locations across Greater Victoria.

Massive Seizure of Artworks

In what has become one of the largest art fraud investigations in recent Canadian history, authorities seized approximately 1,100 pieces of art, including more than 600 pieces from a storage site in Saanich, over 300 in Langford, and more than 100 in Oak Bay. Some of the more valuable pieces, according to police, were estimated to be worth $85,000 each.

Lucyshyn was arrested on April 21, 2022, but was later released from custody. In May 2024, a fraud charge was formally laid against him.

Artwork Returned, but Some Remain Unclaimed

In a statement released on Monday, the Saanich Police Department confirmed that 1,050 of the seized artworks have been returned to their rightful owners. However, several pieces remain unclaimed, and police continue their efforts to track down the owners of these works.

Court Proceedings Ongoing

The criminal charge against Lucyshyn has not yet been tested in court, and he has publicly stated his intention to defend himself against any pending allegations. His next court appearance is scheduled for September 10, 2024.

Impact on the Local Art Community

The news of Lucyshyn’s alleged fraud has deeply affected Vancouver Island’s art community, particularly collectors, galleries, and artists who may have been impacted by the gallery’s operations. With high-value pieces from artists like Emily Carr involved, the case underscores the vulnerabilities that can exist in art transactions.

For many art collectors, the investigation has raised concerns about the potential for fraud in the art world, particularly when it comes to dealing with private galleries and dealers. The seizure of such a vast collection of artworks has also led to questions about the management and oversight of valuable art pieces, as well as the importance of transparency and trust in the industry.

As the case continues to unfold in court, it will likely serve as a cautionary tale for collectors and galleries alike, highlighting the need for due diligence in the sale and appraisal of high-value artworks.

While much of the seized artwork has been returned, the full scale of the alleged fraud is still being unraveled. Lucyshyn’s upcoming court appearances will be closely watched, not only by the legal community but also by the wider art world, as it navigates the fallout from one of Canada’s most significant art fraud cases in recent memory.

Art collectors and individuals who believe they may have been affected by this case are encouraged to contact the Saanich Police Department to inquire about any unclaimed pieces. Additionally, the case serves as a reminder for anyone involved in high-value art transactions to work with reputable dealers and to keep thorough documentation of all transactions.

As with any investment, whether in art or other ventures, it is crucial to be cautious and informed. Art fraud can devastate personal collections and finances, but by taking steps to verify authenticity, provenance, and the reputation of dealers, collectors can help safeguard their valuable pieces.

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Ukrainian sells art in Essex while stuck in a warzone – BBC.com

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2 weeks ago

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September 2, 2024

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Ukrainian sells art in Essex while stuck in a warzone  BBC.com



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Somerset House Fire: Courtauld Gallery Reopens, Rest of Landmark Closed

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4 weeks ago

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August 18, 2024

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The Courtauld Gallery at Somerset House has reopened its doors to the public after a fire swept through the historic building in central London. While the gallery has resumed operations, the rest of the iconic site remains closed “until further notice.”

On Saturday, approximately 125 firefighters were called to the scene to battle the blaze, which sent smoke billowing across the city. Fortunately, the fire occurred in a part of the building not housing valuable artworks, and no injuries were reported. Authorities are still investigating the cause of the fire.

Despite the disruption, art lovers queued outside the gallery before it reopened at 10:00 BST on Sunday. One visitor expressed his relief, saying, “I was sad to see the fire, but I’m relieved the art is safe.”

The Clark family, visiting London from Washington state, USA, had a unique perspective on the incident. While sightseeing on the London Eye, they watched as firefighters tackled the flames. Paul Clark, accompanied by his wife Jiorgia and their four children, shared their concern for the safety of the artwork inside Somerset House. “It was sad to see,” Mr. Clark told the BBC. As a fan of Vincent Van Gogh, he was particularly relieved to learn that the painter’s famous Self-Portrait with Bandaged Ear had not been affected by the fire.

Blaze in the West Wing

The fire broke out around midday on Saturday in the west wing of Somerset House, a section of the building primarily used for offices and storage. Jonathan Reekie, director of Somerset House Trust, assured the public that “no valuable artefacts or artworks” were located in that part of the building. By Sunday, fire engines were still stationed outside as investigations into the fire’s origin continued.

About Somerset House

Located on the Strand in central London, Somerset House is a prominent arts venue with a rich history dating back to the Georgian era. Built on the site of a former Tudor palace, the complex is known for its iconic courtyard and is home to the Courtauld Gallery. The gallery houses a prestigious collection from the Samuel Courtauld Trust, showcasing masterpieces from the Middle Ages to the 20th century. Among the notable works are pieces by impressionist legends such as Edouard Manet, Claude Monet, Paul Cézanne, and Vincent Van Gogh.

Somerset House regularly hosts cultural exhibitions and public events, including its popular winter ice skating sessions in the courtyard. However, for now, the venue remains partially closed as authorities ensure the safety of the site following the fire.

Art lovers and the Somerset House community can take solace in knowing that the invaluable collection remains unharmed, and the Courtauld Gallery continues to welcome visitors, offering a reprieve amid the disruption.

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