03/01/2007: "The Fine Art of Negotiation" by Barney Davey

Let us never negotiate out of fear. But let us never fear to negotiate. – John Fitzgerald Kennedy

According to the Wikipedia Encyclopedia, NEGOTIATION is the process where interested parties resolve disputes, agree upon courses of action, bargain for individual or collective advantage, and/or attempt to craft outcomes which serve their mutual interests.

In the art patch, my commodity consists of my knowledge, experience and industry contacts packaged in the form of consulting, seminars and book sales. That said, I’ve always been available and happy to answer a simple question to help an artist out. If, however, what is being asked is complex or involves more than a few minutes to type out an email reply, a consulting session ensues.

Frequently, I am contacted by artists who have read my book, How to Profit from the Art Print Market, with variations on the same question. That is, they are pondering an offer to license their work, some for traditional fine art reproductions, some for using their imagery to embellish such items as linens, coffee mugs and so forth. Most are inquiring about the fairness of a deal offered and how to get involved without being hosed in the process.

My reply is knowledge is power and attempting to short circuit the learning curve by tossing a question to me is not the best solution. Most often, I point them to any number of good books written specifically about the question they have, or direct them an expert in the field of art licensing.

In every case, I’ve reiterated to them what I hoped they learned in my book. That is beyond acquiring knowledge about the basics on typical deals are structured, it is imperative to learn negotiating skills because this skill will be an enormous help in their careers on multiple levels.

For their convenience, I direct them to my Web site at www.barneydavey.com, which has a page of suggested reading with many books on business and the art business. The selections include several excellent books on negotiating. I suppose this is a variation of give a person a fish and feed them for a day; teach them to fish and feed them for a lifetime.

The reason I emphasize learning negotiation skills in my book, in my consulting and seminars, in email advice to artist’s questions and now in this blog is it is a skill as critical to success for an artist’s career as is color theory or perspective. When adroitly applied, negotiation enhances the desired outcome. For artists, whether negotiating with a publisher or licensor, a gallery or a printer, a landlord or a publicist, better ability results in a better life.

Imagine your rent 5% lower, your tradeshow space enhanced with extras you might have otherwise paid for, or an extra ad page or publicity item or both added to a schedule. What if you got an extra percentage point from a gallery, from an art publisher, or what if your fine art printer came down on price or threw in some extras? Most advertising these days is negotiable, so are many other things that many people fail to comprehend.

You don’t have to be in a pawnshop to negotiate a price. Next time you are in a retail-buying situation, you can open a negotiation by simply asking, “What is the best price you can give me for this item?” You may be surprised with a quick acquiescence by your sales person, or you may be told the price is firm. Either way, you have started a negotiation. If the latter is the case, then perhaps free delivery or some other sweetener may be available. You can be persistently pleasant in looking for a bargain. If you find such tactics distasteful, bless you for you help the retailer maintain a higher profit margin.

How often is art in a gallery sold at a negotiated price? More than you think. When I worked the floor in a fine art gallery in Scottsdale, Arizona, selling originals priced from $1500 - $50,000, I had a leeway of 14% without having to contact the owner for permission to make a deal. Her standard deal with her artists was she could drop 15% without having to contact them. Now, granted neither she nor I nor the artist wanted to give a nickel off as the cash flow all meant something to each of us. And it was rare to have a deal go further south than 10%. Often we would bargain with free shipping or some other service to keep the asking price intact.

Still, late in the day on a slow week and a discount and free shipping might be had. On the other hand, if we had pieces from a popular artist that we knew would sell quickly, there were no deals to be had. Rather than let a disappointed buyer attempting to negotiate such a piece leave empty handed, we would endeavor to show them some items that we thought held great value and were under priced.

We might make that transition like this, “That artist’s work is in great demand and the firmness of the prices shows it. We do have some artists that we feel show great promise and whose work is priced to show appreciation if our evaluation is accurate. Can I show you some of his pieces?”

There was always a delicate dance of who wanted what worse. Did the collector really have a yen for the piece, or was the gallery more desperate for a sale? After a short time, I quickly realized that a brush up on my negotiating skills would become invaluable to me and they did.

Selling retail is a different dynamic than negotiating a contract. You have to react immediately with little knowledge of the person on the other side of the deal with the former, whereas careful preparation and study in a contract will give you confidence and perhaps an advantage in the latter situation.

My father said: "You must never try to make all the money that's in a deal. Let the other fellow make some money too, because if you have a reputation for always making all the money, you won't have many deals. – J. Paul Getty

You can spend near $1,000 to attend a negotiating workshop with Chester Karrass, you can read some great books, or surf for ideas online. Whatever method you choose to hone your negotiating skills, you can expect a handsome return on your effort many times over. If you are an artist, a collector, or a gallery owner and you haven’t taken the time to learn at least some fundamental negotiating skills, you undoubtedly are leaving money on the table. I’ll leave you with this thought:

In business you don’t get what you deserve, you get what you negotiated. – Chester L. Karrass.

Barney Davey
Art print marketing consultant
www.barneydavey.com

Replies: 8 Comments

on Tuesday, March 20th, Linda Paul said

I am an artist who has licensed quite of lot of my artwork. My art has appeared on cd covers, posters, kitchen & food products, numerous book covers, tile murals etc. My advice is have your own License Agreement at the ready and start from there rather than using the one offered by a licensee. You are more likely to get the terms you want.
You can visit my work at www.lindapaul.com

on Friday, March 9th, Barney Davey said

Hi Barb,

Thanks for the kind words. You can subscribe on my Web site at: www.barneydavey.com.

Jose, I appreciated your comments but must confess that J. Paul Getty is not my father. As he was once the world's richest man, it would have been interesting at the least.

I had italicized the quotes, includding the one from J. Paul Getty, but unfortunately, they were lost when the blog got posted. I think that made for a bit of confusion in the process.

on Wednesday, March 7th, Barb said

Great thoughts, Barney. Plus, you elicit some thoughtful responses. How do I subscribe to your blog?

on Sunday, March 4th, jose said

Barney, I enjoyed this very much. Personally I tend to enjoy the negotiating - not so much with the galleries but directly with the buyer - but I am always left with a nagging doubt which you have now helped to dispel with your father's J. Paul Getty quote.

There is of course a margin in my initial quote and I have found that when I lower it to a certain point (though never below my limit) the interested parties almost invariably leave with more pieces than they had initially come to buy. This has happened often. What troubled me was my reaction to the good deal we had struck: I always, somehow, berated myself for having lowered the price, thinking stupidly in my euphoria that I could have made a bundle if I had quoted a better price. The deal would never have happened, of course.

There is another aspect - or dimension - to this negotiation business, beyond the money: how much of one’s 'soul' is given up for it. But I prefer not to go into that now because it is what I was preparing for my next blog.

on Saturday, March 3rd, Andrew said

Barney, this is a subject that scares a lot of artists. We tend to feel it will take too much of our time, or it would be better to leave it to someone else. It's important to remember that even with that someone else, we still will have to negotiate.

on Saturday, March 3rd, Ellen Fisch said

As an artist who is interested in making a living, I often try to look at the "big picture" when selling my work. I am not interested in selling an isolated artwork here and there, but rather, I would like to continue a steady stream of sales ( would that THIS be true!!) to cover my expenses and to validate my efforts. I therefore am willing to be flexible when dealing with the public or those galleries that represent me. If a lower price than I have in mind or even (God forbid) if I take a loss, the good will and/or future sales that the transaction may generate may be worth it for me. My galleries and museum shops appreciate my willingness to work with them to make sales. I also find it a very good idea to have a cordial relationship with those who represent me. They are out there dealing with the public and trying to sell for me. My going the extra mile with my reps can only help me in the long run.
However, there are those time when yeilding to the individual client is out of the question for me. When I was still doing commissioned portraits of show dogs, a woman asked me to meet her in Manhattan to discuss a gift for her husband. She wanted a life-sized portrait of her Springer spaniel jumping into her swimming pool. I quoted her a price based on materials (always the least factor for me), my time and the skills I would be called on to execute the portrait (the x factor for sure!). She was visably shaken by the quote. I swept my arm out and said: "Mrs.___, this is New York City. You can have the portrait done for $20 on the street or 5 million dollars by a high profile artist." That was my last, after 15 yeasr, time dealing with commissioned portrait work. Someday, perhaps, I return to that peripatetic area of art. Until then, I'll sell my work with the "big picture" in mind.

on Friday, March 2nd, littlela said

good story. I will try this to my boss one day.

on Thursday, March 1st, walt said

Barney,

good subject. The Graphhic Artists' Guild has some great material on how to read and negotiate a contract. As you say, many artists are so intimidated by the process that they don't realize how much they can negotiate things to make the arrangement more to their liking. And the advice that you should always let the other guy make some money is terribly important. I think a lot of businesses have forgotten that bit of wisdom today.

I once had a boss at an ad agency who ran away nearly all her vendors because she wanted everything at the cheapest price, in the least amount of time and of the highest quality. In short she was the only one making any money on the work we did. We would move from one vendor to another to always get their best come on bid. Of course they expected to get more work from us down the line at the regular price. We'd worked with just about every printer, typesetter, paper company, freelance artist and copy writer in the local area which was a great education for me but it didn't help the future of our small agency much. You know that the word about our agencies bidding practices got around.

I was getting worried about this. So one day I did a little cartoon with some fancy lettering that said "Price, Quality, Speed, choose any two!" I put it over her desk on her bulletin board one morning before she got into work. When she saw it she asked "What does this mean?" She had that edge in her voice.

I explained that since I was the art director and I had to work with the vendors she chose. I explained that she had the reputation as the dragon lady because no one could make a dime working with her. I wanted her to practice the little wisdom from my cartoon so we could continue to work with the best of our vendors. Otherwise we'd find ourselves having to go further and further away to find cheaper bids which often meant loosing more control over the product we provided. All we had was the quality of service we provided as a reputation. Without that we were out of business. And if the better vendors didn't want to work for us then we were really sunk.

I think she was surprized that I was willing to critique her business practices in this way but ultimately she began to allow me to do what I was supposed to do with an eye towards quality rather than purely towards profit. Ultimately we made profit. And won a number of design awards as well which didn't hurt our reputation in the least.

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03/01/2007: "The Fine Art of Negotiation" by Barney Davey