A Beginner’s Guide to Consigning Your Art for Sale
Photo by Stan Honda/AFP via Getty Images.
To “consign” a painting, according to Merriam-Webster, is to send or address it to an agent to be cared for or sold. In the art world, the term is used when collectors, artists, and galleries entrust other galleries or auction houses with artworks, hoping to make a sale.
Simple in definition, more complex in actuality. Anyone interested in consigning must make key decisions: Do you want to consign to an auction house or to a gallery? Under what terms should you consign the work? What kind of paperwork and agreements are necessary?
Collectors → auction houses
Thomas Rowlandson, Christie's Auction Rooms, 1808. Courtesy of The Metropolitan Museum of Art.
Collectors can’t just hand an artwork over to Christie’s, Sotheby’s, or Phillips; well-established procedures are in place to protect all parties involved.
To kick off the process, a Christie’s spokesperson explained, a potential consignor should request a complementary auction estimate. Auction houses are selective about which artworks they opt to sell—they want to make sure, before you consign your work, that it’s something that fits into their larger sales strategy.
Sellers can submit details about their artworks online or request appointments with auction specialists. “We always try to see the property firsthand before communicating estimates—particularly for unique works of art where surface, texture, condition, vibrancy of colors, and the like are integral to a work’s estimate,” said Nicole Schloss, Sotheby’s head of contemporary art day sales in New York.
If you opt to send a photograph, the auction house requests “good, current color images of the front and back,” along with full details: artist, title, date, medium, dimensions, and provenance. These details all contribute to how the auction house prices the work. Sending a hastily shot iPhone pic, in other words, will not cut it.
Sam Gilliam, Ray VIII, 1970. Courtesy of Sotheby's.
Online consignments are becoming increasingly popular. According to Sotheby’s, the aggregate total for 2019 sales that came through the house’s “consignment platform tool” totaled $74.3 million. “In my category in particular, some highlights to come out of the platform were a Sam Gilliam 1970 beveled edge painting sold for $1.1 million, a Jonas Wood canvas that sold for $596,000, and a wonderful Joan Mitchell that achieved $860,000,” said Schloss.
Once an auction house opts to accept your work for a sale, a specialist will explain the seller’s agreement and the structure used to determine the auction house’s commission. The former refers to the contractual terms of the consignment. Seller’s agreements detail what happens if property is lost or damaged, who’s responsible for shipping costs, and what percentage of the sale the auction house will take in the case of a successful auction—what’s called the vendor’s commission.
This sliding scale commission, which is often negotiable, depends on how much the consigned property might be worth. Typically, the higher the value, the lower the commission percentage. If a work is of high quality and estimated at a high price point, Sotheby’s, Christie’s, and Phillips may compete for it, compelling sellers to consign to them by lowering the vendor’s commission further than usual.
Seller’s agreements can also outline guarantees, which ensure that a consignor receives a certain amount of money, no matter how well a work fares at auction. There is, of course, a downside to taking this more risk-averse path: If a work achieves a sale price above the guarantee, the consignor receives a smaller percentage of the margin.
Before an auction, the house and the consignor will agree on a “reserve price,” the lowest price the consignor would accept for the work. If bidding doesn’t rise above the reserve price, the work will not sell.
A seller’s agreement will also establish the type of sale a consignment enters. A consigned work can either head to the auction block and seek the highest bidder, or go up for private sale. In the latter case, the auction house finds a buyer behind closed doors. This option promotes discretion: Price estimates and results won’t be published. If the work doesn’t sell, that will stay private as well. That can be critical to an artwork’s reputation—if it fails to sell at auction, or gets “bought in,” the work’s value can diminish and prove unsaleable in the future.
On the other hand, private sales don’t generate the excitement, competition, and spectacle that can lead to protracted bidding wars and drive up prices. Private sales also put auction houses in direct competition with galleries.
Collectors → galleries
Galleries can also make private sales, connecting buyers and sellers through their own channels. Some galleries work exclusively with secondary market works consigned by collectors, especially those dealing in modern art and Old Masters. Others simultaneously make secondary market sales and represent living artists and their ongoing outputs.
“A collector would likely prefer to consign a work directly to the gallery if it were made by an artist that we work with or represent,” said Elizabeth Denny, founder of Denny Dimin Gallery. Galleries maintain client lists for their artists and can spend more time trying to place work. In her experience, Denny said this type of consignment could last between six months and a year.
Yet Sotheby’s and Christie’s, with their large and well-heeled departments, are also able to compile powerful Rolodexes and lure consignors. What auction houses don’t have is access to artists themselves and primary market pieces. If collectors are regularly trying to buy work fresh from an artist’s studio, they’ll need to build a relationship with the artist’s gallery. Consigning work to that gallery, instead of to an auction house, can help build favor.
Artists → galleries, and galleries → galleries
William Hogarth, The Battle of the Pictures, 1745. Courtesy of The Metropolitan Museum of Art.
When a gallery wants to mount an exhibition of an artist’s work, the artist typically consigns their work to the dealer, or one gallery can consign work to another. “Nearly all artwork that enters the gallery is on consignment,” Denny said. Alternatively, galleries can purchase artwork with the intention of reselling it. That’s a riskier proposition, however, which leaves the gallery more financially vulnerable.
Denny was candid about the Wild West nature of artists’ consignments to galleries. “Like so many things in the art world, terms are often agreed to verbally or informally (i.e., via email) first,” she said. Contracts sometimes follow.
Galleries work on consignment, instead of outright purchase, to aid their cash flows. “We have millions of dollars in inventory at the gallery, and if we had to acquire this work by purchase, it would not be possible to hold this much inventory,” said Denny. “Working on consignment also gives us the option to return unsold works to the artist.”
Denny noted that consignment agreements with artists typically outline pricing, gallery commission, dates of consignment, payment schedules, exclusivity (whether a consigning artist may show with other galleries), and which party is responsible for costs associated with artwork production, framing, packaging, photography, shipping, travel, insurance, and marketing. Mounting a small gallery show is much pricier and more complicated than it appears to viewers wandering in off the street. It’s a gallery’s job to make it look easy, but artists may also shoulder some of the financial burden.
Artists are often vulnerable when they consign works to galleries. Horror stories abound about gallerists holding artists’ works hostage or paying them late. While collectors’ consignments at auction may feature multi-million dollar stakes, artists’ consignments at galleries are no less important: It’s the artists, after all, who transform burlap, oil, and stretcher bars into meaningful, valuable objects in the first place.