Introduction: What is the Value of Your Artwork?
Art is a form of expression that can be used to convey a message or tell a story. It can also be used to express the artist’s feelings and emotions. Artwork is not just something that you hang on your wall; it can be an investment.
The value of art depends on many factors, such as the artist’s reputation, the size and quality of the artwork, and how much time was spent creating it. The price of art also varies depending on where you are selling it; for example, if you are selling your artwork in an art gallery, then you will get more money than if you were selling it at a flea market.
What Defines the Price of Art?
When it comes to quantifying creativity, the price of your art does not equal the size of your talent, nor should it be a reflection of your self-doubts. Ultimately, the market determines the cost and pricing of your artwork. If we look at art history, we can see how supply and demand, as well as the rarity of an artwork, affect its price.
Costing and Pricing Your Artwork
As an artist, you must be able to approach costing and pricing your artwork in such a way that you can make a profit. Not only that, but if you approach it in a consistent and logical manner, you can avoid it turning into a frustrating experience. There are a number of factors to consider when doing this, including the cost of materials, the time it takes to produce the piece, and any overhead costs.
The Complete Guide to Costing and Pricing Your Artwork aims to be a resource for artists who want to make sure they are pricing their work correctly. It covers all the basics of costing and pricing and provides helpful tips and advice. If you are looking to sell your artwork, this guide is a must-read. So please read on!
What is Costing?
Costing is the process by which an artist calculates or determines how much each individual artwork costs to produce or sell. It is critical to consider cost before pricing a product in order to set a fair and competitive price.
Cost is typically the expense incurred when an individual or company manufactures and sells a product or service.
Some of these costs include some or all of the following:
- Direct or Variable Costs: Vary directly with the number of items made or sold. This includes all money spent for supplies and materials to make the product or provide the service. For example, the cost spent on materials, packaging, and labour.
- Indirect or Fixed Costs: The business expenses or overheads that must be paid whether or not its products are sold. Indirect costs include items such as rent, electricity, telephone, salaries, insurance, and depreciation.
What is Pricing?
Pricing means deciding what to charge for your goods or services. Price is typically the amount a customer is willing to pay for a product or service. The cost of producing a product has a direct impact on both the product’s price and the profit earned from its sale.
Some of the factors influencing pricing include some or all of the following:
- How your competitors price their artworks.
- Sales and expense projections.
- What kind of income the artist needs or wants to achieve.
- Market tolerance. While an art collection can symbolise success, investing in art requires time and a thorough understanding of the market.
Deciding What to Charge
One of the most important decisions you will face as an artist is how to price your work. The reality is that you must earn a living in order to survive, but you do not have to alienate your potential customer base in the process.
Consider the time it took to create the piece, the cost of materials, and what the customer is willing to pay when making this decision. You must also strike a balance between your estimated value of the artwork and what the market is willing to pay.
In making the best decision for yourself and your creative work, the amount chosen must focus on these factors:
- Knowledge of what your costs are and a budget high enough to cover all production costs.
- Allow the artist to earn a reasonable profit.
- Knowledge of the prices your competitors are selling at and what customers are willing to pay.
- Low enough to entice people to keep buying and inform others about your art.
A business can use a variety of pricing strategies when selling a product or service. To determine the most effective pricing strategy for a company, or in our case, as artists, we can consider the following approaches:
- Cost-plus pricing: A percentage profit is added to the price of the product to determine the price.
- Demand-oriented Pricing: Calculating the price of goods or service based on what customers are willing to pay.
- Discount Pricing: The use of promotional or sales methods to introduce a brand-new product or service.
- Penetration Pricing: The reduction of the price of your product is a tactic to attract or keep customers.
- Prestige Pricing: In order to maintain the status or image you want to cultivate, you want to charge more than your competitors for a high-quality product.
- Pricing for the market: Using your competitors’ prices as a guide to set your product’s price.
Target market share: By lowering the prices of products, businesses can gain exposure, gain market share, and possibly gain long-term security.
Break-Even Point: Review your Pricing and Expenses for Success
A break-even analysis is a tool used by businesses to determine the point at which they will start to make a profit. It is a financial calculation based on the concept of fixed and variable costs, with the break-even point being the point at which the two types of costs are equal.
This point can be used to inform pricing decisions and help artists to ensure that they are making a profit. In addition, a break-even analysis can be used to assess the financial viability of a business venture and its ability to meet its expenses.
Calculating the break-even point can assist entrepreneurs in determining whether:
- The price of an item should be increased or decreased.
- Expenses should be modified.
- The potential for success is high or low.
Expert Advice: How to Price Your Art
As we have discussed above, costing and pricing artwork can be a tricky endeavour for any artist. After all, you want to make a profit from your work, but you do not want to price yourself out of the market. Here are some costing and pricing tips to help you find that sweet spot.
Consistent pricing is key for successful art sales. Nevertheless, how do you put a price on your efforts and artwork? How do you decide on a logical approach?
The best solution for many artists is to select a pricing formula that works well for your art form and is a good fit for the stage of your career. A formula can simplify your life and make it easier to explain your prices to potential buyers.
Let us start with two main assumptions:
- Your work has value, and you deserve to be paid for it.
- Someone out there will like this piece, want to own it, and be willing to pay the reasonable price you set.
In order to determine what “reasonable” means, first look at the market rate for your style of art and research art fair or gallery prices.
Consider using a formula for pricing artwork, from one of the methods below. For the purposes of these examples, I will use monetary values in Euros (€) and measurements in inches. If you prefer to work in metric units, simply adjust your rates accordingly.
Pricing Method 1: Square Inch × Euro Amount
Some artists multiply the size of their paintings (in square inches) by an appropriate Euro amount.
To get the square inches of a painting, multiply the width of the work by the length. Next, multiply this number by a Euro amount that makes sense for your reputation and credentials. Then round to the nearest hundred.
Finally, double the cost of your materials and add it to the square-inch monetary value amount. This covers the standard 50% commission charged by galleries when they sell your work.
(Remember that the percentage rate varies by gallery, and can often add anywhere from 33% to 100%, or more, to your price as their commission.) However, if you do not sell through galleries, you do not need to account for gallery commissions.
Emerging artists should consider pricing their art at more affordable rates, while established artists can charge higher rates. For example, an established artist may charge €6 per square inch, whereas if you are relatively new, you might start at a lower range of €2-€3 per square inch and increase the Euro amount once you start making more sales or working with galleries.
When it comes to larger paintings, however, be careful not to overcharge your customers, and consider using a smaller euro multiplier. In method 3 below, I will explain why this pricing strategy can become problematic as size increases.
Example for a painting with a width of 16 inches, a length of 22 inches, a square inch multiplier of €4, and a material cost of €100:
16 x 22” = 352 square inches
432 square inches × €4 = €1,408
Rounded to €1,400
€100 × 2 = €200
€1,400 + €200 = €1,600
Pricing Method 2: (Hourly Wage × Hours Spent) + Cost of Materials
Depending on your technique, “art is time” and your price should reflect the amount of money and time you put into it. This formula ensures you are being paid for each hour you work and are covering the cost of your materials. It is an especially good formula for artists who are just starting out. When deciding on an hourly rate, consider what comparable artists are charging for their work. If you use this formula and your price is much higher than theirs is, consider lowering your hourly rate.
Example for an artist who charges €20 an hour, works for 15 hours to complete a piece, and spends €100 on materials:
€20 × 15 hours = €300
€300 + €100 = €400
Remember that if you plan to sell your work through a third party, you will need to account for commission fees.
Pricing Method 3: (Height + Width) × Multiplier
Some artists apply linear inch pricing if you have paintings of many different sizes. This is a good approach because it is very simple for buyers to understand, as the optics of square inch pricing can be confusing with a range of sizes.
For example, using a multiplier of €2.50 per square inch, your smallest painting (4 × 4 inches) will be €40 and your largest painting (32 × 32) will be €2,560. That can be hard to explain to a potential buyer and could put them off. Linear-inch pricing is a lot simpler to follow and is the method I personally prefer to use.
Example for a 5 x 5” painting at €20 per linear inch:
5 + 5 = 10 linear inches
10 linear inches × €20 = €200
Example for a 36 x 48” painting at €20 per linear inch:
36 + 48 = 168 linear inches
168 linear inches × €20 = €3,360
Once again, if you plan to sell your work through a third party, you will need to account for any potential commission fees.
How to Price Your Art Commissions
For those of you who have little or no sales experience and have not sold much art, a good starting point for you is to price your work based on time, labour, and the cost of materials.
When determining how to price your art commissions, pay yourself a reasonable hourly wage, add the cost of materials, and make that your asking price. For example, if materials cost €50, you take 20 hours to make the art, and you pay yourself €20 an hour to make it, then you price the art at €450 (€20 x 20 hours + €50 cost of materials).
Simple as it is, this formula gets to the heart of beginner pricing, which is that the more you sell, the more your work is worth. Pricing low from the get-go and then gradually increasing your rates over time incorporates skill and demand into your price tag, rather than just dreaming.
The more art you sell, the more your work is worth, which is good news for any artist who is working to ramp up their career.
Pricing Art for Commercial Use
Pricing artwork is one of the most difficult tasks that emerging artists face, particularly when they first start working with galleries and establishing their art business. Reading articles and books on the art market reveals how different even experts’ opinions on how to price artwork are.
There are numerous ways to be compensated for licencing your art for commercial use. Licensing Art entails retaining all copyrights to an image and licensing, or “renting,” the art to someone for either a one-time use, such as in a magazine or advertising campaign, or for a longer term use, such as a t-shirt line or pottery, greeting cards, etc.
You will feel more at ease closing deals once you understand how they work. The following are the three most common methods of payment for art licensing:
- Royalty – the manufacturer pays a royalty percentage of the artist’s gross sales.
- Royalty With An Advance Payable Up Front – There may be an advance payable up front that is later deducted from future royalties.
- Flat Fee – Instead of royalties, a one-time fee is paid.
Pricing art for commercial use necessitates careful consideration of the market, the enterprise to which you are selling, the medium, and the type of art, all of which are affected by a variety of factors and variables.
How to Price Your Art Prints?
For the majority of people, purchasing art is a discretionary luxury item that is highly personal and subjective. That is, it is difficult to establish hard and fast pricing rules, but there are certainly factors that influence its value.
Here are some considerations for how to price your art prints:
- If you and your art are well known, there will be a greater demand for your work.
- The time it takes to create the work has an impact on its perceived value; this includes the time, effort, and thought that went into both the concept and the creation of the artwork. This means that this point is somewhat subjective from the buyer’s point of view. This point, like limited editions, is only valid if the work is already in demand.
- Obviously, the larger the print the higher the cost of reproduction will be, as the size increases you may need to raise your prices accordingly. There are numerous on-demand fine art printing services available, so take your time in evaluating the quality and ways in which the printer can assist you in keeping reproduction costs to a bare minimum.
- One strategy used by many artists is to offer a limited edition of prints. Value tends to equate with scarcity, which is more crucial for in-demand jobs. A limited edition of twenty prints is more valuable than a limited edition of 100 hundred prints, so the quantity of prints in an edition matters. Make sure to note the ‘number of’ on the certificate of certification that will be enclosed with the print.
- Some art collectors have a passion for discovering the next big talent, investing early in their work, and then watching it increase in value. The majority of people who purchase art online do so for aesthetic reasons, such as how it looks in their room, if they have a connection to the artist or their vision, or if the piece of art makes them think of a specific location, such as where they used to live or went on vacation. Only a small percentage of online art buyers purchase for investment purposes.
Price Consistency and Personal Feelings
Pricing Your Art Consistently Pays Off
Pricing your work consistently comes with a wealth of benefits. It allows you to build credibility and establish an excellent reputation among buyers and collectors. Buyers like understanding how art is priced. It will also keep you in your gallery’s good books.
Never Undersell Your Work or Yourself
If a piece was especially difficult to work on, or you are particularly attached to it, you may want to price it higher. However, this can be difficult to explain to buyers and is best avoided. Stick to the measurable, such as the amount of time spent, the cost of materials, or the size, and if you do not want the work to sell, do not list it for sale!
Remember what we said at the beginning of this post, that your work has value, do not forget that.
Many people, however, sometimes get the feeling that they do not belong. That they should not be charging what comparable artists charge, even though they are having success. It is called impostor syndrome (and knowing is half the battle).
Pricing should be based on facts, not feelings. Do not confuse your personal opinion of your art, what you think the art world should be like, or how you think it should respond to your art, with how things actually are.
If you find yourself saying things like “People do not understand my work or they do not appreciate me”, or “Sooner or later I will find the perfect dealer, collector, or whatever and live happily ever after,” you may be making some mistakes in judgment.
If you are not sure where you stand, ask a few people to look at your work and give you feedback. People who will be honest and direct with you, preferably professionals who know something about art, rather than your best friends or biggest fans.
Copyright Law for Artists
When it comes to copyright law, it can be a complex and often-confusing topic for artists, but it does not have to be.
It is simple to understand the basics of copyright law, including what types of artwork are protected, how long your artwork copyright lasts, and what you can do to prevent others from copying or reproducing your artwork.
It is not necessary to register a work in order to enjoy legal protection, as copyright emerges naturally during the creation of a work.
An original painting, for example, would typically be protected by only one copyright. It is, however, possible to have multiple copyrights on the same work. In the case of a recorded song, the music, lyrics, and sound recording all have their own copyrights.
A film contains a plethora of copyrights, which are typically held by a number of people, at least at the time of creation. Typically, they are assembled by the producer and sold to the film’s distributor.
Copyright protection on literary, dramatic, musical, and artistic works lasts for the creator’s lifetime plus 70 years. The term of protection for sound recordings, film, and broadcasts is 50 years from the year of creation.
It is legal to copy anything; however, it is unlawful to sell, publicise, or publish a copy of an artwork unless prior permission is obtained from the copyright holder. It is also illegal to publish and sell a work of art that is significantly similar to another original work of art.
Protect your Intellectual Property
In the unfortunate event that your artwork is copied or reproduced without your permission, there are a number of options.
With foresight, the easiest way to protect yourself is to send a sealed envelope via registered post that contains your idea, picture, script, music, lyrics, etc.
However, if you are concerned that someone has already infringed on your original work, the best way to protect your rights is to register with a copyright authority in your jurisdiction. For example, in Ireland, there is the Irish Copyright Licensing Agency (ICLA) and the Irish Visual Artists Rights Organisation (IVARO).
If all else fails, you may need to seek the advice of a copyright and intellectual property legal expert.
Recap: Costing and Pricing Your Artwork Fundamentals
- Step 1: Define your market. Where do you sell your artwork? Do you sell locally, regionally, nationally, or internationally? The art, artists, and research the prices in your market should be your primary focus.
- Step 2: Define your artistic style. What kind of art do you create? What are its physical characteristics? In what ways is it similar to other forms of art? How do you classify it? For example, if you paint abstracts, how would you describe them? For comparison purposes, you should generally concentrate on this type of art.
- Step 3: Find artists whose work is similar to yours by conducting online research or physically visiting galleries, open studios, or other locations and viewing their work. Pay close attention to artists with similar career accomplishments and résumés to yours. For example, artists who have been creating art, exhibiting it, and selling it for roughly the same amount of time.
- Step 4: Check out the prices of comparable artists charge for their work. Their prices will be good starting points for determining how much you should charge for your art.
When To Raise Your Art Prices?
If sales are good, demand increases, and your artwork starts to sell quickly or faster than you can produce it, you might think about raising your prices slightly, perhaps in the 10% to 25% range. You might even think about donating a portion of this profit to worthy causes.
When To Lower Your Art Prices?
To gain traction as an artist, the public must see what you create and be given reasonable opportunities to own it. You can stand behind your price if you take the time to properly and realistically price your work. Unfortunately, people have become so accustomed to low-cost, mass-produced art that they believe original; one-of-a-kind art should be priced similarly. Artists create unique, one-of-a-kind works, which command a higher price. Do not feel bad about the prices you have chosen.
When Discounts Are Appropriate In Your Art Career?
It is possible that by offering a discount on creative work, you are inadvertently devaluing your product or service, but it is sometimes appropriate to offer a discount to a customer.
For example, you may want to reward customer loyalty or if you make a mistake and need to make it up to the customer in some way.
The only other time I might offer a discount is if it is a family member or close friend, but the discount is usually the same across the board, such as buy the original painting and get a print free!
Conclusion: Sell Your Artwork with Confidence
I get it. You are an artist, and you would rather be spending time in the studio. You can always pay someone else to manage your website and even your social media, but when it comes to costing and pricing your artwork, only you can set your prices.
To summarise, the following factors should be considered:
- Costs incurred
- Break-even point.
- Your reputation.
- Your goal in producing the work.
- Whether you work in one-offs, multiples, or batches.
That said getting started is the hardest part. After your first few sales, you will have the confidence to know your prices are all right. You will find the pricing formula that works for you and coming up with prices will not take so much effort. Soon enough, you will be raising your prices as clients invest in your work. Good luck!
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Thank you for reading.
The Value of Art
Adrian Reynolds ‘Ren’ is a contemporary Artist/Designer based in Dublin, Ireland. His paintings are a response to the world that surrounds us. A world that is changing faster than ever before. His work is an exploration of colour, form and texture, placing his work at the intersection between abstraction and representation. His work has been featured in Ireland, the UK and the US.